Curation Revolution

Community 70% Vs. Mercenary 30%
Once again today we saw an example of why we are creating our Triangle Startup Factory funded startup called Curagami. Today the account created a business using Groupon.

The problem with "drastic deal" sites is they destroy brands even as they appear to be building them. Stopping applying margin eroding deals and business declines. Every "drastic deal" site operates on the premise of "burnout".

Like a vampire drastic deal sites bring clients in and get as much money as fast as possible. They pitch their services as "Internet marketing" when what they really are is a plague of locusts.

The single remaining asset created with lots of ad buys today was a solid mailing list. This is GOOD, but three transitions must happen now:

1. Content Must Be More UGC (User Generated Content) via contests, games and curation. Gamify and value UGC too.  

2. Engage the 70% of socially altruistic vs. 30% mercenary deal seekers. 

3. Curate, Curate and CURATE. 

Read Drive by Daniel Pink. In this MUST read Pink explains our misconception about what motivates MOST people. When a Swiss blood drive offered to PAY their conversions went DOWN. When they offered to give a donation to a charity donations went backup. 

Even when the MAIN instrument used to build a site is DEAL DEAL DEAL inside there list are people more moved by social altruism and doing the right thing than scratching for the lowest price.

If you see on PRICE you are doomed. Someone will always create a better offer. The irony of this company's positioning which was high end trying to create enough DEAL FLOW to keep their doors open with GroupOn only to find the truth - Groupon is the cocaine of the Internet.

Pivoting back toward what makes them BETTER and SPECIAL vs. their competition COMMUNITY is what jumped up out of the water as we spoke (once again). Problem is the now desperate person we were talking too could hear anything since his need for a cocaine fix is now so HUGE he is worried about losing his business altogether (and rightfully so since he asked the brand killer into his home).

Can drastic deal sites serve a purpose? Perhaps, but the infrastructure of COMMUNITY better be firmly in place before spending dollar one on GroupOn or sales will go UP and then come right back down.