Success & Glory: The Waves Of Innovation
As Elite Daily endlessly emphasizes, it has never been easier, faster, or cheaper to attain success in the startup sector. But like anything else in this world, nothing good lasts forever. So, how do you take advantage of this opportunity while it lasts? Ride the Waves Of Innovation.
The Waves Of Innovation refer to the current nature of innovation within the most lucrative and revolutionary industry. In the 20th century, knowledge and mastery of the Waves Of Innovation lead to the success of Carnegie, Rockefeller, and Ford in the most rewarding market of that time: the industrial sector.
Today, that market is the ever-growing tech-startup industry. And everyday — through the Waves Of Innovation — more and more newcomers are climbing up the Forbes list of The World's Billionaires.
With so much money on the table, it should not be surprising that there are armies of competition fighting for market dominance. As computer processing power gets steadily cheaper and faster to produce, this rapid innovation has given rise to new rules for technology pricing, essentially pushing prices down on even brand-new products. What does this mean?
If a product on the market can be monetized by any means other than directly selling it, a comparable version of that product will eventually be offered for free.
Keeping this in mind, here are the lessons to know to ride the Waves Of Innovation to entrepreneurial glory, wealth, and establishment:
History Repeats Itself
Disruption is going on everywhere. And it always has. Look at the music industry… and now even Hollywood. But the best example by far is the publishing business. Print media has been replaced by the web. For the last century, newspapers have been the dominant source of news. They cost money and we paid for them. But news eventually found another way to make money and simultaneously increase reach: advertisements.
But now neither advertisers nor consumers are attracted to paying for print media. The spotlight has shifted to the web. Content is free, instant, and always relevant up-to-the-minute. Because this is where the users are, the advertisers resultantly follow.
This rule goes beyond print medium. Whoever can disrupt the status-quo by making any service or product faster, more relevant, or cheaper will win. Just like the web beat out print. In 2012, we see an acceleration of this rule toward free in services and products, both B2B and consumer.
Networks (Of Any Kind) Thrive
Connectivity, community, and communication are hotbeds for innovation waves: Bell with the telephone, Apple with the smartphone, or Facebook with social networks. But in this second tech boom, we often see social networks gain masses of users (without making money) before finally reaching a certain tipping point when billions are made overnight. Why is this? By nature, there is an innate value in having such a large number of active, engaged, and connected users on one platform.
A platform that is accessible and can collect data, which is an advertisers wet dream. Once membership within these platforms reaches that tipping point, monetization is suddenly switched on and boom goes the dynamite. Facebook, Twitter, and Foursquare are perfect examples of this. But, the most innovative way to take advantage of this network Wave of Innovation is doing it the “Google Way”.
Companies – like Google – that already have monetized products lure in users through networking and connectivity and get their users hooked to their system. Once hooked, these companies showcase their money-making products. Google Docs, Gmail, Gcal, and a host of other products keep people within Google's ecosystem; the endgame–and what pays for all the free product development–is sponsored search advertising.
Hot Trends Are Contagious
Recent innovations have lead to the viral contagion of “consumerization of the enterprise”. What does this mean? Products and services for businesses (not consumers) in various industries have traditionally been controlled by one or two market leaders.
For example, Information Systems – or technology that businesses run their organizations on – has been dominated for decades by B2B giants like Oracle, Cisco, and SAP. But, over the last two years, these titans have been threatened by light-weight startups, often just out of their infancy, really.
The viral Wave Of Innovation shows that one hot, sweeping, and successful trend in a single industry will more than likely spread into other industries, no matter how distant and different. In 2012, this wave is the “freemium” model exemplified by Google, as explained above.
Its Always About The Benjamins (In Any Market Or Year)
But, for this “freemium” model to work, there must be already-monetized products in place. In 2012, social networks – from Facebook and Twitter to Meetup and Mashable – can provide you (as an innovative entrepreneur) the network wave you need to showcase your business for free. Yet, if your business isn't making money, then it does not matter how successful you are luring in masses of users.
So, Elite Daily lays out the top monetization Waves Of Innovation, so that you can quickly rise to the top with your tech startup. All of these monetization options are universal, stretching from 20th century brick-and-morter institutions, like commercial banks to groundbreaking startups like Jack Dorsey's square. The market may change but the Waves Of Innovation ride constantly:
If your venture has multiple products, consider charging hefty prices on your best product, but only after luring in users with your free products on the same platform. Again, like Google.
In this case, product, usage, and service is free. Instead, money is made per-transaction. Your CampusEdge Debit card is free but the bank makes money off the merchant after each card transaction. So goes for Kickstarter, PayPal, etc.
Best choice if you have a content-based website or a social media platform.
It is like the VIP treatment at Disney World that allows you to cut the lines. The tickets to the park are cheap – if not free through your hotel – but the lines are long. However, you can cut the line by paying extra. Farmville and other games use the same method: game and play is free, but you can cheat, win, or speed-up game play by buying (with real money) stuff in the in-house marketplace.
Best choice if your venture is a Software-As-A-Service product. Essentially, users pay for performance instead of tools, function, or even the product itself. Think about when Verizon or AT&T gives you a (crappy) cell phone for free: in the end, they make their money back ten times over every time you pay the monthly bill.
Just beat your competition to the punch. Act today, look at hot trends, and assume they will invade your industry. That's how you ensure that you are first to market, and that's how you win.
Venture Clout | Elite.
Subscribe to Elite Daily's official newsletter, The Edge, for more stories you don't want to miss.