Jason Rines (iThinkBig)

The Problem of Media Economics: Value Equations Have Radically Changed

Bingo. Here's a more personal story in this regard: Businesses want sales leads. That NEVER changes. But the market of 2001-2005 gave contact records that could have been yanked out of the phone book to pass as 'qualified leads'. It was tantamount to fraud. The market prices for this quantitative model was around $20 a lead.

I went the other direction as CEO of a marketing business. I demonstrated a spreadsheet in 2005 to Higher Ed sector how sales conversions with 100% true purchase intent would yield 2 1/2 times the profit of the quantitative model, even with the lead cost being triple, $60.

I proved the model but had to be patient for the market pyschology to change and a catalyst. I prepared in 2007 for the same quality model in Healthcare market. Q4 2008 market accepted the value proposition but the turmoil had middle marketing management running for personal hedges.

Now we are VERY busy already as there is no competion of marketers willing to share the risk. We get paid when our clients make profit. Imagine that, a value proposition.

Last point: If your an entrepenuar attempting to raise money you had best learn how to give a presentation in 10 minutes of how to make money for your investors. Focus on market problem, market solution, management team and competition. Know numbers of how to make profitability and presenting that rather then how your airplane flies and putting potential investors asleep.


On Jan 07 01:29 PM Good News Economist wrote:

> Scott,
>
> Great examples. This re-arranging of the value chain in media represents
> a huge opportunity for those entrepreneurs willing to invest the
> time to understand and business sense to monetize their understanding.
>
>
> For those new businesses and business folk that get it right, it
> will be nothing good news.
>
> GNE