Customer-created content is good business. Letting customers
strut their stuff is profitable.
Google’s acquisition of YouTube is proof that customer-contributed
content is shrewd business practice. Going from zero to $1.65 billion in 24 months is
an admirable accomplishment. It’s the kind of accomplishment that makes most
business people both jealous and incredulous. Yes, letting customers strut
their stuff makes very good business sense, indeed! The content is free.
Customers flock to the site to see and be seen. Visitors’ viewing, tagging and
downloading habits create a natural merchandising engine. It’s cool because
others thought it was cool. I can find it easily because others have tagged it.
Customers are playing the roles of Lead Customers/Users, Contributors, Guides, and Promoters.
Customers’ Behaviors have Changed the Business Model for the
TV Industry
Customer-led merchandising is great marketing. Letting customers
strut your stuff reaps advertising revenues and free publicity.
What tickles me is how fast the entertainment companies ran
around in front of the customer parade. After years of posturing and
hand-wringing about intellectual property protection in the era of file-sharing
and easy downloading, all of the major entertainment companies signed up to
take part in the spoils.
As the Google/YouTube deal was going down, the dominos fell
throughout the movie biz. According to Hiawatha Bray, YouTube deals hint of new era for Net media - The Boston Globe, Universal Studios, Sony BMG, CBS, Warner Music, et al all quickly
inked deals with YouTube and Google that go something like this: “It’s OK with
us if customers pirate video clips from our movies and TV programming, you (Google-YouTube)
tell us about them and give us 50% of the ad revenues.”
This is “found money” – additional revenues they wouldn’t
have gotten. It’s also customer-led merchandising. Customers will vote with
their eyeballs and their tagging and rating, highlighting as noteworthy programming
that might otherwise lag in the Nielsen ratings.
Now, what about all those home videos? Will amateurs also
get 50% of the ad revenues for their amazing pet tricks’ videos?
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