Update: The irrepressible Jason Calacanis has proclaimed that “50% to 80% of the venture-backed startups currently operating will shut down or go on life-support (i.e. 3-4 folks working on them) within the next 18 months”. Matthew Ingram boils down Calacanis’ key messages.
Anyway, back to our original programming, which is focused on an important element that startups need to focus on:
The Web 2.0 landscape is like going to a wonderful all-you-can-eat buffet where the menu is never-ending and there’s no worry the kitchen is going to run out of food.
With new services easy to create, launch and distribute, the Web 2.0 pipeline is gushing with new entries – some of them innovative, some of them useful/valuable and, sadly, many of them vanity projects that serve a niche so small that you wonder why they were created in the first place.
With so much choice and competition, the biggest challenge facing every new Web 2.0 is answering one fundamental question: What’s in it for me?
By that, I mean a service needs to communicate quickly and clearly why someone should use it. What does the service do? What problem does it solve? What are the benefits? How easy is it to use?
They sound like simple questions but you’d be surprised by how many Web 2.0 put the cart (the technology) before the horse (what the service does).
The pattern is pretty familiar: new service is launched to much excitement, gains a little traction from bleeding-edge users before quickly losing steam because it fails to resonate with “regular” people because the “What’s in it for me?” question isn’t answered or badly handled.
In the fast-moving Web 2.0 world where users exhibit little customer loyalty, you have to capture the attention and imagination of people immediately. Even if your service is great, you’re doomed if you fail to tell people from the start what it is and why they should use it.
The second part of the “What’s in it for me? equation is getting people into the service as quickly as possible once you convince them to cross the registration/trial hurdle. Your service needs to be intuitive, easy to use and user-friendly.
Again, this sounds like Web 2.0 101 but it’s difficult to pull off without a lot of work, insight and experimentation. How you think someone is going to use your service may be totally different from how it’s actually used. The features you believe are going to resonate with users may gather dust while features added as after-thoughts may be really popular.
The bottom line is you’ve got to watch how people use your service and what they do.
If you get no traffic or usage, there are fundamental problems that may force you to re-load. It could be the service sucks or you’ve done a terrible job telling people why they should use it. If people try the service and then leave, you may have a flow problem, which is a deal-breaker given many people will give up and move on to the next service if they run into any problems they can’t solve quickly.
So when you’re developing a new online service, put yourself in the shoes of the user, and ask yourself: “What’s in it for me?”. You may come up with answers that surprise you.
Update: An important part of any Web site that probably doesn’t get as much attention as it should is “About Us”. A good one can be an extremely valuable tool while a bad one will cause people to flee in frustration. Jakob Nielsen’s latest usability newsletter focuses on how to make “About Us” resonate with users. It’s a fascinating read.
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