Tuesday, November 29, 2005


Website Buyouts Put Price of Average Website User at $38

I was just reading an interesting article over at Business 2.0 (that I was informed about by Darren Rowse's Problogger.net) that talks about how, after taking the selling price of many popular websites and dividing that price by the site's number of unique monthly visitors, they arrived at an average price per user of $38.


Why is a unique visitor worth so much? Because mainstream business is finally beginning to tap into the potential of online advertising. In 1995, there were hardly any US online ad sales to speak of, by 1999, that figure had reached $6 Billion. At that point in time, most dot-commers were projecting online ad sales to be somewhere in the ballpark of $16.5 Billion by this year. Then the bubble burst, in 2002, online ad sales had gone back down to $6 Billion (from $8.2 Billion in 2001). In spite of the burst four years ago, online ad sales are projected to reach $12 Billion this year.

The average American consumer spends 3 hours a day online as opposed to 1.7 hours watching television. However, American industry spent over $25 Billion in the first six months of 2005 on TV advertising alone. If viewing time is any factor, it's easy to see how spending on online advertising could stand to be four to eight times what it is now!

So what can I do about it?

Why not start an online community? Successful communities have thousands of members, many of whom visit the community quite frequently. Some visit daily, some visit weekly, some visit several times a day.

According to the Business 2.0 article, companies pay more per user if your users are "fiercely loyal." Imagine how many companies would be willing to pay for advertising on a website with thousands of loyal daily visitors?

But I'm not Confident Enough to Start My Own Community

That's where Zoints comes in. Stay tuned...

Tuesday, November 08, 2005


Communities: The Killer Application of the Internet

I joined my first online community back in the summer of 2001. That community, SomethingAwful.com (SA), is now one of the largest and most successful in the world. I had recently moved to an area of California where I didn't have any friends, and I was bored. I started making friends on SA and before long, found myself en route to a "Goon Meet" in Central California. I was meeting people from the internet in real life. Scary thought!

Eight of us met in a pool hall that fateful evening. Seven guys and one very brave woman. There was the gentleman with green hair who was into cosplay, a huge guy who worked at Apple, a male model trying to make the big time, a skinny guy who called himself "Dork", a Microsoft employee...you get the idea. For the first five minutes or so, we all stood around uncomfortably. But after that, we began to loosen up and have a good time - thanks in small part to alcohol, but mostly due to our common bond and interest (SA).

By the end of the night it was as if we had been friends all of our lives. I can't articulate what a good time I had and the bond I shared with these seven fine folks. As we were parting ways, the big guy from Apple said something to me that would change my entire life and ignite an unquantifiable passion within me. He said, "I'm not a social person, I don't have any friends. I almost didn't come tonight. The first five minutes I was uncomfortable and I almost left; I thought you guys were way too cool for me. But now, now I have seven new friends. Seven more friends than when I started today. This has been the best day of my life."

At that moment, I realized the importance of online communities. If they could make such a profound difference in one man's life, what could they do for society as a whole? And so began a four year process. The founding of Zoints Inc. is the final stage in that process. Zoints has compiled a database of online communities that have over 240 million members. By comparison, the entire population of the United States is 296 million. The online community phenomenon is not an untapped niche, it is an undefined industry. And as technologies improve, prices drop, and the internet becomes more intertwined in our daily lives, those numbers will increase at an exponential rate.

Zoints will lead the movement to put online communities on the map. As people continue to found and immigrate to these globalized virtual towns, cities, and metropolises, Zoints will be there to enable, empower, and support those in need. Soon, we shall all begin to realize that communities are the killer application(read the link, it's worth it - Jim) of the internet.

This page is powered by Blogger. Isn't yours?