The "user generated" trend

I think that a key moral of the story behind the emergence of online communities like Flickr and MySpace, and the larger stampede that is the blogosphere of posts, feeds and tags is that people really like to create, categorize and filter content items that are a reflection of their unique perspective.  Similarly, they like to connect with like minds.

On some level the above assertion is intuitive to the point of being obvious, but on another level, it really starts to explain the magic of eBay, Craigslist and Google; namely, enabling consumers to cheaply, quickly, easily and flexibly tailor a message, an offering, a target market or even something as fundamental as a query. 

Let's face it, after you have posted a job or classified listing on Craigslist, choosing your own wording, layout and presentation, done it cheaply or even for free, and not been taxed by the word or penalized for re-working the message if ineffective, the thought of going back to the old model of newspapers is pretty unappealing. 

Similarly, cultivating a blog or commenting on another's post is joyful, liberating and instantaneously more rewarding than hoping against hope of securing a spot on the limited shelf space of print media. 

I will go further and argue that the proliferation of "user generated" content and commentary is not merely a fad or flavor of the week, but a mega trend that will play out over the next several years, in the process touching wholesale categories of both online and (traditionally) offline products and services.

Moreover, the low friction, low cost dynamics of replicating and distributing digital goods and services is starting to be augmented by new physical production models that enable, for example, authors of limited print run books to self-publish, (an area where Amazon is well positioned), and an ecosystem where artists can license their designs, no matter how good, bad or nichey, for use on apparel, stamps and print goods, and consumers can essentially create their own branded products in a few clicks, an area that Zazzle is taking a leadership position.

While a concept like The Long Tail has gone a long way towards articulating the structure and magnitude of this trend, and a complimentary Wired article called Remix Planet captures the texture and range of products that this trend will touch, I think that two books (both by the same author) should be trusty bookends for entrepreneurs looking to exploit this opportunity.

The first is called Future Perfect, and beyond being a good 15 years ahead of its time, introduces the concept of mass customization that is the foundation of the trend that I see playing out.  The second is called Blur, and it introduces a three step model for maximizing returns in an environment where each individual offer can be broadcast at a very low cost: Seed, Select and Amplify. 

The premise behind the approach, which direct marketers and (unfortunately) spammers get big time is that when confronted with frictionless economic models, the goal should be to first plant lots of low cost "seeds," or offers.  Then, select the seeds that sprout, or show promise based on qualified user response levels.  And finally, amplify, or market the hell out of the seeds that have proven to garner the best response rates in the market. 

The book gives a great example of a credit card company that uses the approach to launch new credit card offerings by doing an initial direct mail run which tests out literally hundreds of different credit card "offers" segmented across its target customer base.  The results help them narrow their focus to the core, but multiple, product offerings that pass pre-defined response thresholds, and the company has organized their business as a credit platform optimized to be able to deliver and support a multitude of highly customized credit card offerings.

Both are compelling, timely and enjoyable reads.  Check them out.