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The Best Travel Agent? August 20, 2008

Posted by Jussi Huotari in : travel, web2 , add a comment

What sights should I see in Barcelona, Spain? Which trails would be suitable for my type of hiker in the Rocky Mountain National Park, Colorado? TripSay answers to these questions by providing recommendations and tips from friends. The idea is simple: instead of browsing through a number of websites and guidebooks, just get the travel tips from my friends. The value of a personal recommendation can hardly be overemphasized. Think about it: I’m going to the Rockies and talk about the upcoming trip with my friends. One of them tells me about the Bear Lake hike and the clear waters and especially about the elk she happened to see across the lake just when she was sitting down for a break on a fallen log…

A vivid, colorful story told by a trusted person overrides any guidebook author’s opinions or random people’s suggestions. This is true for any purchases or selections a person makes - and thus underlines the success of word of mouth marketing.

Now, a related interesting statistics from the world of social media and web 2.0 is the number of friends a person typically has and how a “friend” is defined. According to some research, the average number of friends a person has in Facebook is 164. The median is a bit less but still: social media empowers people to connect with friends in large numbers. A traveler network with many friends raises the probability that one or more of the guys in my network have been to the place I’m going to. This is actually working in practice: with already tens of friends in my traveler network, I’m having most of Europe and some USA covered quite well!

It helps a lot in planning a trip, if a person I know is recommending some of the places along my route. Thus, a good candidate for TripSay’s slogan: “Your friends are the best travel agent.”

Easy Investment April 23, 2008

Posted by Jussi Huotari in : startup , add a comment

Regards from the sunny Barcelona! The European early stage investment forum (Easy) was organized in Barcelona this time and I was here representing TripSay. The forum aims at matching startups with business angels around the Europe to create cross-border investment opportunities. Sounds complicated, huh? In reality the event worked quite well. The organizers had invited a number of investors (mainly angels) and selected 17 companies who were given an 8 minute slot to give their pitch on the stage. Good stuff!

There was also an excellent keynote speaker. Nelson Gray shared his experiences as a business angel in a very unusual way: he used concrete examples of companies and real numbers! It was very refreshing to listen. For example, his first investment had gone bad and he draw some guidelines from the experience. In retrospect he could say that the entrepreneur was not good, the business model was poor and there were no barriers to entry for the competitors. Then why did he invest? He gave an answer and said that he learnt from the mistake. And that afterwards he hasn’t done the same mistake again. Instead he has done 11 other mistakes. :-) Well, he can afford to do mistakes as there are more successes than mistakes in his portfolio. If you have a chance, Nelson’s presentation is worth seeing.

Creative Lapland April 6, 2008

Posted by Jussi Huotari in : travel , add a comment

I was asked to speak at the Creative Lapland Seminar in Rovaniemi.

The seminar is about experience economy and tourism. In their words:

Although experience has become an everyday buzzword, most businesses do not know how to change the core business processes to render customer experiences. A holistic multi-sector approach is a key for successful experience product development; the best innovations are created by exploiting the broadest creative potential and breaking the boundaries between industries like tourism and content industry or ICT and cultural production.

Sounds good! At TripSay we place special interest in combining experiences with travel. We think that travel is about experiences and not about booking the cheapest flights. We are building a service for sharing those experiences with trusted people.

I’m going to speak about travel industry transition to digital age and travel community building through social media. My presentation title is “TripSay - customer engagement in social media”.

All speakers are listed here. Speakers include C. Michael Hall (New Zealand) whose presentation is titled “Innovation value creation points in tourism firm” and Erik Hedblad (Sweden) who gives an inside view to tourism entrepreneurship in Åre ski resort.

The seminar takes place in the end of April (17th and 18th). I guess there won’t be any snow in Rovaniemi when I’ll be there. Spring will come even to the arctic circle (but not to the south? Heathrow Airport is struggling with the recent snowfall).

An Emerging Start-up Pattern March 30, 2008

Posted by Jussi Huotari in : startup, web2 , add a comment

As you probably know, we changed the name of our online travel service from Vailoma to TripSay. The rationale behind the name change was to get a name that’s easier to remember and that gets associated with travel also by people who don’t speak fluent finnish.

Anyway, it seems that an other travel start-up changed their name at almost the same day. This coincidence is clearly a sign of an emerging pattern in start-up space. As Tim Hughes of The BOOT puts it:

A new start up pattern is emerging overnight in the content space. First you form a team, then you get a little funding, put out a beta site and generate some buzz. Then, naturally, you change your name. Within days of each other we had news that community and guide content player Vailoma is now called TripSay (announcement) and content/review aggregaor Kango is now called UpTake (announcement).

Yes, naturally. :-) Have to agree with Tim’s analysis. As I wrote in the comments, I wonder if we’ll get more followers to this pattern…

Digital World in Analog Terms

Posted by Jussi Huotari in : web2 , add a comment

In these digital times it sometimes helps to explain things in analog terms. How to tell about a web 2.0 start up to people who associate business on web with selling dog food at a loss to huge number of potential (vs. buying) customers? One solution: find an analogy from the “real” world. Here’s my case example:

Building a web site is somewhat similar to creating a new paper magazine. In both cases you follow the same steps:

  1. Print or publish the first version of your content.
  2. Attract readers to sample the content you provide.
  3. Do your best to convert the first time random readers into subscribers or returning users.
  4. Sell advertising space on your medium.

Once you get the reader base big enough you’ll be able live off the advertising and/or subscribtion revenue. The same goes for a web site. Of course there are a number of other proven business models but I find this local newspaper analogy easy to explain when my grandma asks what my company does… ;-)

Okay, so the business depends on getting readers and converting them to “subscribers”. Andrew Chen introduced an interesting metric useful in this context: activation efficiency. In his blog, Andrew says:

So let’s define a new metric, which I’ll call “Activation Efficiency,” using the marketing parlance of how many contacts you can “activate” into leads and then into sales:

  • Activation Efficiency = total retained users / total acquired users

where:

  • Retained users means total # of users that had 2 visits or more, let’s say
  • Acquired users means the total number of uniques that come in through your viral loop

Now that sounds like a metric to keep an eye on! As he points out, it doesn’t matter if you get 1.000.000 users if only 0.1% activate. Better to acquire 100.000 visitors and activate 10% of them!

Designing a Web 2.0 service March 24, 2008

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The “million dollar question”: What makes a good social media web site? Providing a useful service and putting in the standard social media concepts such as social graph, wisdom of crowds and UGC are the pre-requisites but hardly enough if the site doesn’t provoke people’s interest. The diminishing attention span of the Internet public calls for simplicity and differentiation. Oh, and the first time user’s Wow! effect wouldn’t harm either…

There are three criteria for making a web site a success:

  1. The service must be a question! A question demands an answer and we do want to engage the user to a dialogue. And, pay attention, the question must be to the user, not from the user! Examples of good questions: “Where have you been?” (whereivebeen.com); “Where are you now?” (wayn.com); “What are you doing?” (jaiku.com). When I come by a new service, I want to know what the service is about and whether it’ll be useful for me. A question from the service to me is a clear message and if it’s interesting, I’ll take the time to answer.
  2. The service must have a value proposition! The user must understand what she’ll get from using the service. Otherwise, why would she answer the question? The service must tell a convincing story of what it has to offer to those who answer its question. Whereivebeen.com says “easily track your travels”. Wayn.com tells a story of hooking up with others travelling to where you are. Note: this criterion is not about the service’s usefulness but about the story it tells!
  3. The service must support ego gratification. Why do people generate content on social media sites? Because they want others to notice them. They want show off: “You know, I’m an expert on this issue.” or “Yeah, of travel I’ve had my share.” Some people may prefer another way of putting this: something along the lines that people share their expertise because they want to help others. And that is as true but doesn’t change the fact that the service must support showing off to and helping others!

That’s all. Design your web site according to these three criteria and your site will be a success.

What about items not included on the list above? Ease of use, fancy graphics, short response times, and technology choice. All of these are important but definitely not crucial! It doesn’t matter if you have the easiest to use calendar interface that works like a breeze if people just don’t get your question and story.

What makes social media?

Posted by Jussi Huotari in : web2 , add a comment

Social media is one of the Web 2.0 core concepts. As such, understanding the concept thoroughly is one of the keys in developing a successful Web 2.0 web site.

Basically social media denotes a site that gives its users tools for interacting with each other. Thus basically any blog or wiki or photosharing system is a social media. But what about the services or sites utilizing many components of the social media concept? Such services are designed around a common interest such as travel or sports and their success depends on user community building.

Wikipedia defines social media as “an umbrella term that defines the various activities that integrate technology, social interaction, and the construction of words and pictures.” That’s quite a mouthful so let’s break down the explanation to its components. In my opinion, the three core components of social media are:

The best (in terms of size and growth of user base) social media services combine all of these three components.