The money way

The Google way - volume - network effects - unclear quality

- gather as many people as possible - network effects
- show them an ad
- statistically a very tiny portion of the people will be targeted by your ad
- an even tinier portion of the people will go and visit the store (website)
--- Store owners pay per entry (click) See Google’s AdWords.

Stores have even more visibility now with the targeted marketing of Google’s AdSense. Say I have a website about crap, then Google AdSense will automatically put crap-related ads on my site. Google will then split the profits generated by pay-per-click with me. Yey!

The Wall Mart way - volume - cheap - clear quality

- bring clients to the store (even if it means to lose some money by selling some products under their profit value)
- sell as many products as possible for a tiny profit (sometimes percentages of a cent)

The Amazon way - volume - loyalty and trust - clear quality

- sell as many products as you can by creating a trusted network (reviews, recommendations, etc)
- Amazon positions itself on the customer’s side. Saying we can drop the price but if your book is crap and you get bad reviews it won’t sell.

The Ebay way - volume - loyalty and trust - clear quality

- let people sell what they want
- take a little percentage of their transaction


The Facebook way – loyalty and trust - targeted volume - clear quality

- let people bring other people
- create an extremely flexible but reinforced trusted network
- present really targeted and specific ads (well they don’t have an open system like google does).
- Extremely powerful in targeted marketing

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Among these models we can distinguish:

Informed (loyal) Customer - users know what to expect quality-wise
Those that consistently give the customer what he wants (and give them impartial tools to make informed decisions) – Ebay, Amazon, Facebook
Facebook might jump to the other side.
Wall Mart – hey, we’re just cheap, that’s why you’re here. Quality wise you get what you pay for, but look at all the crap you can buy in one place!

Uninformed (not loyal) Customer - users don't know what to expect quality-wise
Google – the results are not rated in any way. So it needs more and more volume of users to cover for the disappointing experiences that the users have when they go to a lame advertiser’s website.

What’s next?