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Well, yes. But that isn't always the most useful paradigm for thinking about some of those businesses, and it doesn't always apply. When I go buy an iPod at an
by wanorris 19y ago
Well, yes. But that isn't always the most useful paradigm for thinking about some of those businesses, and it doesn't always apply. When I go buy an iPod at an Apple store, what customer makes money off the purchase? When Safeway sells me a pork roast, what customer makes money off the purchase? When I subscribe to a premium account at ESPN, is there a customer that makes money off the purchase?
For manufacturers, it is certainly important to develop a value proposition for distributors and retailers. For ad-driven media businesses, it is critically important to develop a value proposition for advertisers. But it's at least as important to make something that people want. If you have a product that nobody wants, it doesn't matter how good the retail markup is. If you have a media property with no eyeballs, what good will really brilliant advertising packages do potential advertisers?
- skmurphy 19y agoA media business is driven by the ability to deliver a well characterized audience, and the value those characteristics imply to advertisers. The challenge is not a media property with no eyeballs. The challenge is what audience can you gather to sell to your advertisers. If they are undifferentiated then you have to have millions because they are not of much value. If it's presidents of Fortune 500 firms then you only need an audience of a few hundred to be able to make a lot of money. So I would suggest it's not "people" but a well characterized audience at an acquisition cost that allows you to mark them up to your advertisers who will in turn make more money from the purchases your audience makes. The YC mantra of "make something people want" gets interpreted in ways that cause a lot of startups to overlook the value of a niche focus.