Brother, Can You Sparadigm?

One word of advice about where your competition will come from: Everywhere

“Did you feel that?”

If you’re from California, those words make the small hairs on the nape of your neck stand up, and you reach for something that’s nailed down. If you’re in the Internet industry, those words make your shoulders sag, and you swing a heavy head to the newsgroups to see what paradigm got shifted today.

We are comfortable watching the Internet change daily. We are used to it. We are getting e-mail from our mothers, reading our grandparents’ newsgroup posts and viewing pages outlining our kids’ homework assignments for the week. We are also getting used to looking over our shoulders at the competition to see what’s on their sites. After all, we need to know what it’s going to take to keep up with the Joneses.

What we haven’t gotten used to is the idea that we need to step outside our industries from time to time and look for innovations all over the map. A great deal of innovation in the online world is coming from TGIG (two guys in a garage) companies that float their IPOs before they’re even blips on our radar screens.

At Internet World International in London, Starwave Corp.’s Patrick Naughton told the audience that visitors to his company’s ESPN and Mr. ShowBiz sites have voiced one overwhelming desire: A unique experience. Information is good. Content is great. But for the small guy, the real edge comes from the ability to turn on a paradigm and offer a unique service.

Business Models Are a Paradigm a Dozen

I have yet to have a conversation about the Internet with an intelligent human and not come up with an idea for a new Web-based business. Not a rehash of offline businesses. Not “Let’s sell movie tickets on the Web” or “Let’s put up a virtual grocery store.” I mean really new ideas that truly exploit the unique properties of the Web. To wit: Twenty-five cents for a tarot card reading, 25 dollars for a personal chart. Online collectors’ baseball card auction. Instant automobile insurance broker.

These ideas are free. Take ’em, they’re yours. You may already be working on something like this in your spare time. That’s great. Just don’t tell the boss until you’re ready to make the IPO.

Ideas are everywhere. Russell Davies of the Leo Burnett Co., also speaking at Internet World ’96, issued this warning: “The Internet is a minefield of opportunity. Step carefully, or another opportunity will go off right in your face.”

Most likely your competition will come from small companies you’ve never even heard of. They’re not in your business. They’re not even trying to be rivals. But they will be, because they are taking the initiative to try something new, taking traffic away from your site and taking customers away from your trough. The answer? Adapt and adopt.

When You Think It’s Competition, But It’s Not…

John Balint is a graphic artist. He creates brochures, catalogs, direct mail pieces and the like. He wanted a better way to get quotes for his customers’ printing jobs. From his classic TGIG comes LithoQuoter, a product that lets print buyers enter the specifications of any job by filling out an online form. LithoQuoter consults a database of printers to match the job to those best able to do the work; the customer’s request for quote (RFQ) is then sent to selected printers for bidding.

“Print buyers are very busy,” explains Balint. “They have to call on four or five printers for quotes, fax the specs to each one and hope for competitive pricing. LithoQuoter has a large pool of recommended printers to pick from. The specs are entered once, and the RFQs all go out at once.” Some printers have been reluctant to throw their hats into this ring. After all, why should they compete against a database when they can put bid spec forms on their own sites? “Once we explain that we’re just another print broker, they get it,” says Balint. “Why not have somebody else touting your services and sending business your way?”

The Internet is the cradle of cooperation. If it looks like a competitor, figure out how to turn it into coopetition or cooperation.

Crunch Time

The banking industry is dipping a toe in the shallow end. The multiple listing services are in the changing room deciding which bathing suits to wear. Lending institutions are waiting for somebody else to try the high dive first. Meanwhile, Financenter Inc. is gliding along in a perfect swan dive.

Financenter President Sherri Neasham knew she was onto something from the get-go. “It’s simple,” she says. “People have tons of questions about borrowing money, whether it’s for a home, a car, or even a credit card. Here’s a place they can get answers and do some number crunching. It’s casual, it’s free, it’s private, and there’s zero pressure.”

The number crunching itself is not simple at all. Amortization schedules may lack excitement, but they aren’t written overnight. Rather than settle for mere payment schedules, Financenter created programs to answer critical questionssuch as How much can I borrow? Should I pay discount points to get a lower rate? How much will my closing costs be? Free of charge.

Complex financial calculations for free? Is Neasham crazy? Like a fox. Once you’ve figured out the perfect loan for you, Financenter invites you to apply for that loan online, with 48-hour response for approval.

Lending institutions are late to the game. Can they compete? Sure. All they have to do is put in a nauseatingly large number of hours finding the right talent. Just like Financenter did. Next they’ll have to put a full year into raising awareness of their offerings. Just like Financenter did.

Or they can take the cooperative approach. Instead of competing with Financenter, the Los Angeles Times, several online brokers, and a major commercial online service provider are talking to Neasham. Some will lease the code from the Financenter server, paying a fee each time the server runs a calculation for them, and some will run their own offerings from the Financenter server. They understand that there is talent out there to be leveraged.

Shift Happens

Where do you look for the next potential content provider? If you sell software, you should consider the services of Cirrus Arts Corp.‘s Versions . The company’s president, Lawrence W. Lee, wants to keep your customers up to date on your progress.

“The service is free to subscribers,” explains Lee, “and allows them to receive e-mail notification regarding version changes, upgrades, updates and bug fixes, all from one convenient location. Subscribers have been signing up in droves, in spite of very little publicity on our part.”

Can’t see the value? Might as well do it yourself? You’re not thinking like a customer. The person responsible for software upgrades at a company of any size does not want to be on 28 mailing lists from 28 software houses. Going on vacation means transferring all of his or her e-mail to a colleaguenot a comforting prospect.

If you want your software delivered as well, look to Oil Change from CyberMedia Inc., which will download software updates and install them for you. CyberMedia is shooting for 1,000 vendors to sign up. We’ll see whether corporate network managers like allowing desktop users to upgrade on the fly. If they do, this is a great addition to a software company’s Web-based arsenal.

New opportunities are going off, as Davies says, at every turn. The more they include the Web as their method of delivery or the basis of their service, the more they can steal your thunder if you’re not watching for them and working with them.