SmoothSpan Blog

For Executives, Entrepreneurs, and other Digerati who need to know about SaaS and Web 2.0.

Fred’s Got it Wrong About the Lowest Common Denominator

Posted by Bob Warfield on July 21, 2009

Caught VC Fred Wilson’s post today about the importance of not ignoring the lowest common denominator.  In this case he’s talking about SMS and Twitter.  Simeon Simeonov concurs, and its easy to agree with this approach, but let me be a dissenting voice on this kind of strategy.

It’s tempting, oh so tempting, to want to pull in the lowest common denominator.  It’s the theory of getting a few percent of an incredibly large market.  Absent real information, you may as well swing for the big market fence, even though the lights on the stadium are turned off, it’s pitch black, and you have no idea how far out there that fence may be.

Sometimes this strategy works, but most of the time it doesn’t.  Why?  Because the early adopters generally aren’t on the lowest common denominator.  They don’t care about it.  Throughout the years, the winning strategy has been to build something for next year’s highest common denominator.  That’s right.  Build software that doesn’t even work very well on what we have today, trusting that by the time you need a big market to be there, you would have created the perfect product for it.  Go ahead.  Use too much memory.  Use too much cpu.  Use graphics that won’t render on the cheap cards.  It doesn’t matter.  The early adopters already have the more powerful machines, and by the time you have crossed the chasm, everyone else will too.  The origjnal Macs barely ran at all as did the original Windows PC’s.  You see this pattern over and over in the technology adoption cycle.

Fred is talking about Twitter and SMS in his post.  He admits probably less than 15% of Twitter posts use SMS.  What kinds of handsets do you think the vast majority of real live (not the ones who signed up and went away, which may be 2/3′s of the Twitter audience) Twitter enthusiasts have?  Motorola Razors that need SMS?  Or smartphones of one kind or another like the iPhone that don’t? 

His best example is how easy it is to sign up for Twitter with SMS.  That’s great when the Twitterati is at a cocktail party and a bunch of buds are gathered around to see the wonders.  They can be signed up instantly no matter what phone they have (though I don’t ever remember seeing anyone do this even in Silicon Valley, but hey, it’s a good anecdote).  But what are the chances they actually matter?  What are the chances they use the service?  This is resource put into lowering the friction to look, but not to adopt.  As I’ve written before, this is Twitter’s biggest problem.  They did a great job lowering the friction of trial, but the friction of extracting value is still way to high.

Twitter is showing in spades that the problem for a startup is not just to get noticed and tried, it is also to do something so insanely great that people stick to it and care.  As Scoble says (and he refers to Twitter), all the PR hype in the world isn’t enough to build your business.  That’s not to say a lot of people don’t care about Twitter (I’m one of them, BTW), but getting people to care is hard.  It’s a never ending process.  It is not based on balance, diversification, or lowest common denominators.  It is based on focus and value creation.

The Mobile Web is incredibly accessible, but there is growing evidence that it lacks usability and value creation in a major way.  Sarah Perez writes that the success rate for performing various tasks there is only 59% versus 80% on the PC.  Her post is appropos of the common denominator:

Surfing the web with your hot pink Razr’s built-in browser is an experience that leaves a lot to be desired.

It is, in fact, the rise of the smartphone that has made the mobile web such a popular destination on both consumer devices and those designed for business use, like the Blackberry.

Successful apps aimed higher.  They aimed for the Smartphones and the better user experience they provide.

Isn’t it interesting to note how often the more successful and happy Twitter users have to augment Twitter with external clients?  The Tweetdecks of the world?  What if the effort expended around adding SMS support to Twitter had gone to something sexier?  Facilitating real conversations or doing any one of the myriad of things that people turn to these clients to do?

This issue of lowest common denominators is related to diversification, focus, and military strategy.  It comes up in so many ways that are related.  Seth Godin writes constantly about the need to really find your focus carefully and not succumb to too broad a spread.  Mike Speiser on GigaOm writes a great post on how diversification leads to mediocrity.  And military strategists have been avoiding the lowest common denominator for years.  They try to focus strength at a weakpoint, create a breakthrough, and expand that breakthrough to win the battle.

Startups are weak organisms.  Most of the time they can’t afford to chase the lowest common denominator.  There is opportunity cost there that can be fatal.  It is the opportunity cost of failing to diversify, failing to do something really different, and failing to grab your audience in a way that convinces them they just can’t get what you have anywhere else.

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4 Responses to “Fred’s Got it Wrong About the Lowest Common Denominator”

  1. chrism100 said

    Bob,

    You are again on point! I have two Twitter accounts with a cumulative of about 3500 followers. I have found Twitter is good for ‘branding’ and guiding traffic to a landing page but it doesn’t help me with my start-up company http://www.connectionforce.com. What is to brand? I have much more impact with my time contacting my target directly instead of crafting conversations about my company.

    Twitter is fun to play with though.

    Thank you Bob!

    Chris

  2. ajaydawar said

    Bob

    As usual – a thoughtful post. Agree with you arguments around strategy – of focus and remembering that Startups are inherently weak in resources. That said, I don’t think Fred Wilson’s point was about that – I believe, what he meant was that making the services easier to access, even “easiest to access” (lowest common denominator) has something to do with twitter’s successful adoption. We can argue if twitter has the right strategy; but if the intention of twitter’s management is to make it absolutely easy to get thought-bytes into twitter – from anywhere, anytime – and they believe that it is important to their success then I think their actions have worked. If twitter wants as many people to participate – even the 15% is important.

    Ajay

  3. smoothspan said

    Ajay, it isn’t just about the scarce resources, but on applying them to the audience that matters too. Making it easy for people to use your service who don’t care about your service doesn’t help anyone.

    In this case, I would argue that people without smart phones were not the market for Twitter when the SMS feature was enabled. Not even close really. In fact, they are probably not the market even today.

    With that said, Twitter did get adopted because there is low friction to adoption, but I’ll argue that the SMS was not a significant piece of that. Unfortunately, as I have also written, Twitter has high friction to extracting value for users. Focusing on that would have made more sense. Eventually, I’ll wind up writing a post about how they can do that.

    Cheers,

    BW

  4. [...] Fred’s Got it Wrong About the Lowest Common Denominator « SmoothSpan Blog [...]

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