Web 2.0 - Where's the money? | Boagworld - Web & Digital Advice

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Paul Boag Posted by: Paul Boag On Tuesday, 1st November, 2005

Web 2.0 – Where's the money?

With just two weeks until the d.construct conference on web 2.0, I find myself spending an increasing amount wondering how this whole web 2.0 craze is going to work itself out.

Digital Strategy:
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My problem is that I see many scary similarities between web 2.0 and the dot com boom. Take for example digg.com. I love digg.com. It’s a great site. I love the concept of a social news website. I love its use of AJAX, web standards and all those other buzzwords. I was stoked to hear yesterday that Kevin Rose (the founder of digg.com) has raised $2.8 million to expand the site. All good news, but I am left wondering how the site will pay for itself. Kevin on the TWIT podcast explained that the additional funding was required because advertising didn’t even cover their server costs. If advertising isn’t going to pay for the site, what is?

I am worried that once again we are seeing an explosion of sites that use cool technology and have cool ideas but lack a sound business plan.

And it’s not just the web 2.0 flagships

I am very conscious that recently I have been banging on a lot about return on investment but I can’t help but bring it up again. Not only does this apply to sites like digg.com, which epitomise web 2.0, but also new bits of web 2.0 functionality you are considering adding to your own site. For example, ask yourself, is it worth adding a drag-and-drop shopping cart to your ecommerce site? Will that generate more sales? Will it increase customer satisfaction?

Jumping on the bandwagon

Why do we always do this? Every time a cool new technique or technology emerges, we all jump on the bandwagon and start applying it randomly to our projects. Take flash. Remember those days when we would slap a flash animation on the front of our sites just because it looked cool. Are we not in danger of doing the same thing again with web 2.0 and AJAX? Not every site needs to be AJAXed up to the hilt.

Profit isn’t a dirty word

As with all new trends we need to carefully consider when and how to use web 2.0. We need to understand how they ultimately will make us money, because believe it or not that is why the majority of websites exist!

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