This blog is a platform that I use to share ideas and catalogue my thoughts. My main interests are in Entrepreneurship, Venture Investing, Hospitality and Economics.
Met with Helgi Hermansson, former TV program producer, now an Entrepreneur trying to create a platform for video curation for the travel industry. What is that you ask? well, it is quite simple they want to be the filter of the videos that you see on YouTube but the filtering is specifically for the Travel Industry, Hotels, Airlines, Restaurants, City councils, Historic Sites, tourist attractions etc will be made into movies by you and me, the website will provide the guidelines on how to make the video and you can upload it to their cloud. They will market and sell it to the Travel industry and you get a cut of the revenue that your video generates. Not a bad idea for all those artists trying to make it in the TV business around the world. The website is called localsrecommend.org, as .com site was already parked and given that he is an Entrepreneur did not want to spend money on buying the domain. They already have a number of locals in their networks established in various cities and they control the quality of the videos that are uploaded into their platform just like it is done in a TV Studio or a Movie Studio. I like that, quality control on videos and providing a filter on YouTube like platform is a good thing especially from a business perspective. He wants to build this platform into a global business, the travel industry buys subscription to the content and embed the videos in their respective websites. We had a very long and good discussion on his pitch, which needed work, how he could make the business scalable, pricing, driving eye balls to his content etc This is a trend that is bound to emerge in the video content on the web, niche sectors will create their own curation channels just like TV channels now are targeted to a specific cohort Children's channel, Sci-Fi channel, Comedy channel etc the same organization is bound to happen to content that has been created on the Internet.
As Entrepreneurs we are always faced with constraints related to marketing and selling our products and services, that is natural and true for every company. Very few companies have a unlimited budget to spend on marketing. I have had my pet peeves with the Marketing departments while I was working for a bank. The problem I had was, I never knew whether the money we spent was worth it. This is no longer a problem, today technology exists to precisely build-measure-learn from your marketing efforts. I saw this post in The Next Web with the title "10 Marketing Hacks For Entrepreneurs", I think it is applicable to any businesses and I don't know why they have the title as a Hack? I wish established companies would run their businesses like a startup especially in the marketing and sales organizations because they never give you the metrics related to the spending they do. Here is the list if you have not gone to the article to read it:
I would add your company blog is a great way to market your product or service or what you do. Marketing is a promise you keep with your customers. If you don't tell them what you are doing they usually don't know. All the above tools does not replace simple truth about marketing, as Seth Godin'spost on Marketing says:
The simple first rule of branding and marketing anything (even yourself)
Not a secret, often overlooked: "Keep your promises." If you say you'll show up every day at 8 am, do so. Every day. If you say your service is excellent, make it so. If circumstances or priorities change, well then, invest to change them back. Or tell the truth, and mean it. If traffic might be bad, plan for it. Is there actually unusually heavy call volume? Really? Want a bigger brand? Make bigger promises. And keep them
Spoke at conference on Tourism and Investment yesterday. I may have said things that were not in agreement with the rest of the speaker as it relates to the number of tourist visitors to Iceland. I think everyone wants to believe that the upward trend is going to continue but I disagree. My assessment is that 2011 was by far the best year and it was the peak, 2012 will be flat or can be lower than 2011. Here are my reasons:
Travel today is easy, you can find remote places, book your ticket, learn more about the place before you leave your chair and get connected with local people and/or ask your friends/family/trust network how is this place you are visiting. Given this background, the choice of travel destinations have widened a lot. Iceland has to compete with all other remote, unique and different places. What is going for Iceland is the nature and the experience past travelers have had
Euro Zone is going to go into recession and the first thing anyone cuts when you need to conserve is Travel
However, US market is picking up so there may be more visitors coming from there to offset the slowdown from the Euro zone countries.
Iceland had one of the best PR and marketing campaign conducted by the Global media in 2010 because of the Eyjafjalljokul eruption and then again in April of 2011 there was another smaller eruption. The pictures, videos and discussion of the volcano basically brought attention to Iceland and that drove the tourism numbers. Nothing like that has happened in the past 6 months.
Let me illustrate with the following three graphs, the first one is just the % change between years of Foreign tourists overnight stays, the second one is the absolute number of overnight stays by foreigners and the third one is a trend of searches for the word "iceland" in Google. If you look at the second graph, the absolute value, sure it is an upward trending graph but if you look at the % change the numbers don't look all that great. It has rebounded but nothing to the level that we seen even in 2005. The bounce can be attributed to various reasons, the volcano, Inspired by Iceland campaign, Icesave in the news etc. The good thing is that those who have visited Iceland always have great things to say so the network effect might draw others to want to come. These are smaller effects compared to the forces of Recession. It is more like comparing a Tsunami to a ripple. My philosophy on predicting the future or forecasting is very similar to George Soros, "Markets are unpredicatable, so I don't try to predict their direction". The long term prospects of Tourism in Iceland is very attractive, however, our investment thesis in Iceland is not based on the absolute number of growth but Niche growth of the higher end tourists who are looking for something unique and Iceland fits that bit fantastically and that is where we are investing.
Does Iceland not know how to market or sell its products or services? Entrepreneur, investors and general public's opinion on Marketing and Sales is "We don't know how to Market or Sell". I hear this all the time, had an interesting conversation with Managing Director of a Venture Fund in Iceland and the assessment was the same, their portfolio companies are great at product development but some of those companies don't do marketing or sales very well. I volunteered to help and that is what prompted me to write this post. I don't agree with the generalization, I think Icelanders and Icelandic companies do just fine in Marketing and Selling but then every company is different and I don't like to generalize or stereotype the issue.
Fred wrote a very popular post last year on Marketing which created some serious debate in his community, he followed up with this post and called it a Bug Report. I would encourage all those who are reading this post and want to learn more about marketing in the new world to click on both the links above and read the entire post and the entire discussion. I think that one post and discussion should be a semester of teaching on Marketing for Entrepreneurs in an MBA class.
Here are some pearls from the post:
Marketing is for product or service that suck (don't really agree, it still needs to be discovered)
Early in a startup, product decisions should be hunch driven. Later on, product decisions should be data driven
Early in a startup you need to acquire your customers for free. Later on, you can spend on customer acquisition.
Don't be a google bitch
Marketing is the name we use to describe the promises a company makes, the story it tells, the authentic way it delivers on that promise. (in comments by Seth Godin)
Read the post.
I have been advising and mentoring all entrepreneur I meet on how to position, market and sell their product or service and I am no expert on this or good at this to claim that I can help but with good discussion and being a sounding board I think I help and also learn a lot. I believe in the philosophy that if you want a great student change their role to be a teacher.
In addition, I watch and learn from the very best and that is power of this new world of Google, Twitter, Facebook, YouTube etc, if you have the passion to learn and the commitment to devote the time, you can learn anything. What do you all think? Do Icelandic companies know how to market or sell?
My friend Stjani was watching Seth Godin talk about our obsession in the Race to the bottom, i.e. continuously seeking cheaper products and services is coming true in 2012. His emphasis was if price is your only marketing strategy for your product or service, there is always going to be someone willing to do the same for cheaper. This got me thinking about Hotels and Hospitality. I have been invited to give a talk on January 25th in a Conference on Investment and Tourism here in Iceland and I think I will focus on talking about the Race to the Top instead of the Bottom.
I have been meeting a lot of people in Iceland who want to build a hotel. I think that is not a bad idea given that Tourism is a growing industry in Iceland and there has been a pent up demand for Hotel rooms as the last proper hotel was built in 2007. The financial collapse in 2008 has made a number of building standing empty and it seems logical to think of ways to utilize them. I have written about what a tourists spends on a trip to Iceland. They spend a big portion of their wallet in Air ticket and other miscellaneous retail not Hotel and Accommodation, so starting an airline is not such a bad idea.
When I ask the question what kind of customer segment that the Hotel should cater to... I get blank stares! Nobody is thinking about who they are building the hotel for! This is an epic fail in the new world of tourism and travel. You don't believe me, check out Google Insight, under the category Hotel & Accommodation the word "unique" is trending up and "cheap" is trending down. What does this mean? well, people show their intent based on the search words and when majority of the travelers are looking for Hotels or Accommodation, they are looking less for Cheap hotels and more for Unique, Boutique, Different experiences.
I think Hospitality development in Iceland needs to focus more on defining who their customers are and targeting the development catered to their taste. Maybe, that is being done by focusing on the traveler who does not want to spend any money when they visit Iceland should that be the customer Iceland should focus on? I think not... we should focus on providing excellent service to travelers who can afford to pay for the service, they get the Icelandic experience for free and pay exorbitant price for everything else so they want to cut spending money on Hotels. I would say don't focus on that cohort, target the affluent traveler looking for unique experiences and Iceland has many.
Met with Helgi Hermansson, former TV program producer, now an Entrepreneur trying to create a platform for video curation for the travel industry. What is that you ask? well, it is quite simple they want to be the filter of the videos that you see on YouTube but the filtering is specifically for the Travel Industry, Hotels, Airlines, Restaurants, City councils, Historic Sites, tourist attractions etc will be made into movies by you and me, the website will provide the guidelines on how to make the video and you can upload it to their cloud. They will market and sell it to the Travel industry and you get a cut of the revenue that your video generates. Not a bad idea for all those artists trying to make it in the TV business around the world. The website is called localsrecommend.org, as .com site was already parked and given that he is an Entrepreneur did not want to spend money on buying the domain. They already have a number of locals in their networks established in various cities and they control the quality of the videos that are uploaded into their platform just like it is done in a TV Studio or a Movie Studio. I like that, quality control on videos and providing a filter on YouTube like platform is a good thing especially from a business perspective. He wants to build this platform into a global business, the travel industry buys subscription to the content and embed the videos in their respective websites. We had a very long and good discussion on his pitch, which needed work, how he could make the business scalable, pricing, driving eye balls to his content etc This is a trend that is bound to emerge in the video content on the web, niche sectors will create their own curation channels just like TV channels now are targeted to a specific cohort Children's channel, Sci-Fi channel, Comedy channel etc the same organization is bound to happen to content that has been created on the Internet.
