For the past decade now the social graph has taken center stage. It started with the social graph wars of 2004 with the rise of Facebook and was re-invented in 2007 with the rise of Twitter.

If the social graph is defined by our relationships and connections to the people we know or care about, then the interest graph is defined by the relationships and connections to the things we like or care about. The interest graph is the next evolutionary step in painting a more realistic picture of our lives.

Facebook started to build onto this by adding the like feature and allowing people to show off their interests. However, this is a surface level relationship and does not give any real information as to why we like or how much we like something.

We can’t just throw on an interest layer on top of some social product, just like you can’t throw on a social layer on some product. The interest graph needs to be built from a solid and defined foundation, where the clear purpose is cultivating and growing relationships and connections around interests.

Businesses have been able to leverage the user’s social graph to propagate their brand, product, or service quickly across entire networks. However, unless interests are matched this does nothing to convert users into consumers. With an established interests graph businesses will be able to match their offerings with that of the users resulting in higher conversions and better consumers.

The social graph has set the stage for the interest graph to become the next star.

People talk about what could possibly become the next Facebook. My prediction is it will be the company that can most successfully capture this interest graph and execute much like Facebook did with the social graph.

One of the startups trying to accomplish this task is Qlobe. www.Qlobe.com

To be continued…

“I am but man” done in Illustrator.

Group-buying is when individuals come together to purchase goods or services as a whole to get better discounts off the things they need or want. It works this way because businesses are guaranteed quantity of sale and therefore are willing to offer a lower unit price (Point a -> Point b).

However, with the advent of Groupon businesses believe they are getting more out of these deals than just a quantity of sale at a lower price (Point b). They believe they can attract new consumers and shift their entire demand curve out, charging normal prices and selling more units (Point b -> Point c).

This has yet to be proven because the demand curve can only be shifted in the long term. Businesses are sacrificing revenues (50% split with Groupon) in hopes of a short term shift in demand. Some businesses are even pricing below their cost curves, losing money on every unit sold.

Businesses need to realize that these deals only change the point on their current demand curve. The only way to shift the demand curve is continual product/service improvements or consistent marketing over a period of time. One deal on Groupon does not equal long term viable marketing.

Groupon is still a great tool for excess inventory though. Use group-buying as a way to sell units that would have otherwise gone to waste. A good example is using Groupon to sell out an upcoming basketball game. Just understand that those same people may not be back unless you offer a similar deal again.

Hopefully as group-buying becomes more common businesses will start to understand how they work and when to use it.

What do all three of these have to do with today’s serial entrepreneur?

Everything! Let me explain:

Cats are volatile. Not actual Cats, but cat like content: lolcats, piano playing cats, paddy cake cats, and etc.  You never know when one of these videos or juxtapose picture with smart remarks slapped on is going to blow up on the internet. They spread like wild fire, fueled by our curiosity leaving us wanting more and more.

Teddy Bears are the nostalgia we wish we never lost. At first we loved our teddy bear, it was our best friend. We shared stories, laughter, adventures, and even the occasional snuggle. However, as we grew up the feelings faded and we grew tired of the toy. Then its appeal soon disappeared altogether.

 Doughnuts are like heaven sent pastries crafted by God himself in his own personal delicatessen. The good ones melt in your mouth, make you crave more, a never ending desire to consume and consume.

Today’s serial entrepreneur is volatile, at any given moment the next huge idea or product could come flying out of their brains at any moment, engulfing everything in its path with flames of passion. They produce viruses that spread across the internet and plague our very minds with their intoxicating solutions to problems we didn’t even know we had.

Today’s serial entrepreneurs give us a sense of nostalgia. Their products make us explore the world a new. They create products that become our best friends. We share stories, laughter, adventures, and of course the occasional snuggle. However, we soon lose our interest and the appeal begins to fade. Entrepreneurs are then forced to adapt and keep recreating our sense of adventure every time.

Today’s serial entrepreneur are heaven sent, crafted to build us our utopia and lead us to the promise land. The more we go down the rabbit hole, the more we believe they are the true powers of this universe. They create worlds, destroy others, and astonish us with magic like skills.

Seriously though, cats, teddy bears, and doughnuts are what make up today’s serial entrepreneurs.

Done in illustrator using TheNounProject.com symbols

A better look at what Groupon does (and doesn’t do) for local businesses.

Let’s walk through a typical deal and how to affects a local business. A typical deal will launch for around 75% the normal value of whatever product/service is being offered. Then Groupon takes a 50% cut of all revenue gained. This means that the local business will end up taking in only 12.5% of the normal value.

If a dinner normally costs 20$ the restaurant will only make out with $2.50 per meal. Most of the time these deals result in a business losing money on every deal sold. Why then would a business choose to partake in these Groupons?

Most businesses say it is less about making the sell and more about mass marketing their product/service. They hope to build hype around their business and after the deal is over a portion of these deal seekers will become loyal returning customers, paying normal prices and brining their friends.

However, these customers are just that, deal seekers. They move from deal to deal looking to take advantage of a new Groupon offered every day.

So what Groupon doesn’t do is build customer retention, but what it actually does is help businesses remove excess inventory.

Businesses should leverage Groupon to make deals on their excess inventory. They should focus on using Groupon as less a demand side (marketing) tool and more a supply side (reduce inventory) tool.

These deals should lower the price just enough to remove unwanted inventory, whether that be a dinner table during off-peak times, or the last of all the concert tickets a week before the show.  Focus on building deals that bring in smaller margins, not create a loss on the sale.

Businesses that understand this will do better off than those that don’t.

Made in illustrator using TheNounProject.com Symbols

When I first get access into a new beta site or a newly released site the first thing I tend to look at, and judge them by, is their design.

Even if your target market is Harvard Grad students and you assume they can use their smarts to figure out your convoluted layout, you may want to think again.

Design should be done for the lowest common denominator, aka my grandmother (Nana) should be able to get on and ask only one question: “What is her email again?”

This means carefully looking at all your features and products and figuring out how each one relates to the other and what steps it takes to accomplish actions within these.

This, however, does not mean you should dumb down your features or products. Create for the power user (Harvard Grads) but allow my grandmother the same chance at using it.

One good approach is to write out all the actions and challenges someone might face on your site. Then write out how many steps or decisions it takes to accomplish that task. Try to minimize these steps as well as minimize the number of decisions a user has to make.

More decisions /= more power.

This will allow you to remove a lot of friction you may have on your site.

Less friction = more traction (Physics aside)

Done in illustrator using TheNounProject.com symbols

Done in illustrator (Space Walk)