Category Archives: Business

A Healthier Attitude toward Business Stats

There was a scene in the movie Social Network. Mark Zuckerberg and his team moved into their first office. They placed a big screen in the lobby showing the number of registered Facebook users. That number was going up continuously and motivating everybody in the team.

Business Dashboards

A similar practice is popular among executives nowadays. Instead of big screens in lobbies, executives have their key numbers on their computer screens. Those numbers are visualized in a few charts that fit a computer screen. This collection of charts are called dashboards.

An executive can see all the key numbers of their business with a single look on their dashboard. Think about the dashboard in your car. It’s a crucial part of driving. You need to know how fast you drive, how much fuel you’ve left, and whether your engine is overheating or not.

The Benefits of Dashboards

Business dashboards serve various purposes.

  • Motivation
  • Decision making
  • Determining the direction of the company
  • Detecting problems
  • Coming up with points of improvement
  • And so on…

The Numbers I Track

I track two numbers about my blog. The growth ratio of my Medium followers and my email newsletter subscribers. My target for both figures is 10% weekly growth. I explained this goal in a previous post called How I Use Growth Metrics to Optimize the Stats of My Blog and Email Newsletter.

Numbers are critical. Money is nothing but a collection of numbers in databases around the world. You need those numbers to pay the bills. If you want to improve your business, you need to keep track of your numbers. What gets measured gets improved.

However, numbers aren’t everything. When you’re driving, you don’t look at your dashboard all the time. You look at it at critical moments. During the rest of the time, you look at the road.

When running a business, it’s not so evident that you have to take your eyes off the dashboard once in a while. If you don’t pay attention, you can easily get lost in numbers and data. As a result, you might miss some critical aspects that can’t be measured by numbers.

Obsessing about Numbers

I was in that situation for a few weeks. The numbers of my blog are easy to track and extremely volatile. I hit my goals one week, miss them the next. This type of volatility can motivate you to the point of obsession. I wonder whether that kind of motivation is healthy.

Being obsessed with numbers can lead you to make mistakes. Think about a sales rep who makes unrealistic promises to their prospects to meet their targets. Think about a software developer checking in buggy code to complete their tasks before the deadline.

Stressing about Numbers

If you can’t reach your targets for an extended amount of time, you might be tempted to quit. Many people can’t handle the stress of not meeting their goals. As a result, they either give up, or they decrease their targets.

In our imagination, we expect linear growth. In practice, we experience long plateaus of mediocre results punctuated with growth spikes. You can check Malcolm Gladwell’s book Tipping Point for more about this.

My Unhealthy Relationship with Numbers

I had an unhealthy relationship with the numbers of my blog in the last few weeks. I obsessed about them. I didn’t think about hacking my way to reach my goals. Such a practice backfires in the long term, but I was demotivated when I couldn’t reach my targets in a given week.

A Healthy Attitude toward Numbers

I decided to change my relationship with the numbers of my blog.

  • I’ll keep tracking them, but I’ll quit obsessing about them.
  • I’ll use them as guides, not as punitive masters.
  • I’ll do my best to achieve my goals, but I won’t be attached to the results.

This approach is called high involvement, low attachment. I first read about this approach in the book Supercoach by Michael Neill. The idea is to do your best and let the chips fall where they may.

My New Practice

  • Check my numbers once a week. This is what I used to do anyway.
  • Brainstorm about action items to meet my targets of the next week.
  • Decide on action items to execute in the next week.
  • Execute those action items during the week.
  • Repeat all the steps every week.

The idea here is to work hard with a positive attitude. There is an optimal mental state for maximum performance. It isn’t being desperate, pessimistic, worried, or anxious. It’s being optimistic, having faith, being motivated, and accepting the results entirely.

Conclusion

Numbers are a critical part of a business. Without the numbers, you don’t have a business. Yet, obsessing about numbers can lead you to make mistakes. Worse, it can lead you to quit altogether.

The solution is to keep tracking the numbers with a healthy attitude, doing your best to achieve your goals, and letting the chips fall where they may.

Three Alternative Revenue Sources for Medium

In yesterday’s post, I explained why Medium’s subscription business isn’t sustainable. In essence, it satisfies neither readers nor writers.

I’m a big fan of Medium, and I want it to succeed. That’s why I’m going to share alternative income sources for Medium in this post.

Current Model Is Good for Users But Unsustainable

I’m not motivated by my interests when criticizing the current model and proposing alternatives. The current model is more beneficial for me than the one I suggest.

The current model gives me an excellent, ad-free platform to publish my posts and reach a significant audience. I’m afraid this won’t last long.

I propose a model that is less beneficial for me in the short term, but that will keep Medium afloat longer. That way, it will benefit us, writers and readers, in the long run.

Let’s go over the three alternative income sources for Medium.

Charge Writers for Publishing on Medium

Publishing on Medium is a privilege, and it should be treated as such.

If you charge for the opportunity to post on Medium, writers will approach the platform with greater respect.

Similar to the current system, a writer can publish three posts for free in a given month. That gives an opportunity to everybody to publish on the platform. Anything more than that will require the writer to pay Medium.

Writers would pay Medium for the exposure they get and for the audience they reach. That exposure and audience aren’t available anywhere else for free. It has a value that can be monetized.

What about Comments?

In this system, commenting will be free. If someone wants to publish a 45-minute post as a comment, that’s fine.

If my observations are correct, comments aren’t distributed as widely as standalone posts. Therefore, the writers who publish their posts as comments won’t get as much distribution as the writers who pay the subscription fee.

Charge Writers for Increased Distribution of Their Posts

Medium is a post distribution mechanism.

Writers benefit from getting their posts distributed to a relevant audience. They could increase their benefits by getting their posts distributed to more people. They could pay for that extra distribution.

I assume Medium is considering several criteria when distributing a post to an audience. These criteria might include the engagement of the readers, the tags of the post, the followers of the writer, and so on.

Each criterion has a weight in calculating the relevance score of a post to a reader. The posts with a higher score are displayed in a higher position to a reader.

We can add one more criterion to this overall score: the amount of cash paid by the writer.

I suggest keeping the weight of the distribution fee between 10% and 20% in the overall score of a post. If this weight is lower than 10%, writers won’t find it interesting to pay the distribution fee. If it is above 20%, the overall quality of the platform will suffer.

Sell Privacy Protection Packages

Nowadays, data is a gold mine, and privacy is a problem. In his last post, Ev Williams, CEO of Medium, states that Medium doesn’t sell data to third parties. This is an uncommon practice on the web.

Almost all digital products and services collect user data and sell it to third parties. This practice is a source of income for many websites.

By not selling data to third parties, Medium is benefiting its users. It’s only fair for Medium to charge for that benefit.

As I explained in my post on privacy, I recommend online businesses to offer two types of memberships to their users.

The first type is the free membership. Free memberships are subsidized by selling user data to third parties. This is the current online standard. Most of the websites, products, and services you use on a daily basis are funded with this system.

Privacy Protected Premium Memberships

The second type is a privacy-protected premium membership. In this tier, user data is not sold to third parties, but the user pays for the benefit.

Medium is leaving a lot of money on the table by not collecting and selling data to third parties. This alone could beat the income from their current paid membership model.

It Isn’t Possible to Safeguard Data Anyway

You might oppose this model, but third parties probably collect the data you enter to Medium and sell it further.

If you use Google’s Chrome browser or the Android OS, Google is collecting and commercializing your data anyway, even when you use Medium.

Even if you don’t use Google products, data finds its way to third parties. Here’s an experience I had recently.

My Medium Comment Leaked to YouTube

I access Medium only via Firefox on a Windows PC and Medium’s iOS app. Recently, I added a comment about IKEA to a Medium post. A few hours later, YouTube started to show me IKEA ads on another device.

I have no idea how that data is leaked to Google, but it leaked anyway. Data finds its way to third parties. Why not sell it yourself and charge the people who want to protect their privacy?

Conclusion

Medium’s current subscription-based business model doesn’t seem sustainable in the long run. There are three alternative revenue sources for Medium.

  • Charge writers to publish on Medium
  • Charge writers to increase their distribution on Medium
  • Commercialize the data of the free users and sell privacy protection packages to premium users.

These revenue sources seem to put readers and writers in a disadvantaged position in the short term, but they are more sustainable than the current model in the long run.

If the current model fails, we will lose Medium altogether. Paying for publishing posts, increased distribution, and privacy protection is a small price to pay to keep Medium afloat.

Your Turn

  • What do you think about the revenue sources proposed in this post?
  • Do you have alternative revenue sources for Medium?

Is Medium’s Business Model Sustainable?

If you look at my archive, you’ll see at least a dozen posts on Medium. Almost all of those posts are praising Medium.

I take Medium seriously, use it as the single source of traffic, and learn a lot of lessons from my Medium stats. It’s an excellent platform for readers, writers, and humanity.

In short, I’m a fan of Medium. Nevertheless, I don’t believe in its business model, and I’ll explain why.

The Number of Paid Memberships Is Growing

In his last post, Ev Williams, CEO of Medium, shares the progress of Medium’s subscription business.

Mr. Williams shares a chart of the daily new members and the total number of members. Both numbers seem to be growing, but there aren’t actual numbers on the chart. We don’t know whether the total number of premium members are 10K, 100K, or 1M.

50K Weekly Writers, 80M Monthly Unique Visitors

Mr. Williams cites other stats. More than 50K writers publish at least once a week on Medium. Medium received more than 80M unique visitors in a recent 30 day period. Those are some strong numbers.

There is a critical question to be asked though.

What is the conversion rate of the 50K writers and 80M unique visitors to premium members?

I don’t know the answer to that question. I don’t think that conversion rate is high enough to sustain Medium in the long run.

Spotify’s Value Proposal

To justify the premium membership model, Mr. Williams mentions other businesses based on similar models. One of his examples is Spotify.

I’m a premium Spotify member since it became available where I live. There’s a huge difference between Spotify’s premium and free offering.

  • Ad-free
  • Unlimited skips
  • Listen offline
  • Play any track
  • High-quality audio

That difference is worth more than the €100 I pay them every year, especially considering their vast, ever-growing back catalog.

Medium Premium’s Value Proposal

I don’t see a difference that is worth $50 / year between the free and premium versions of Medium.

  • Premium posts don’t have marketing messages, not even links to email newsletters.
  • You can save stories to an offline reading list.
  • There are some commissioned stories.
  • You can listen to the audio versions of popular stories.

Medium Premium’s Competition

In the premium content space, Medium’s offering can’t compete with Kindle and Audible as far as I’m concerned.

In the free content space, Medium is the biggest competitor of its own premium membership business. In the free audio segment, there are more than enough quality podcasts.

While trying to prove his case, Mr. Williams is making some sad remarks in his post.

“There is — and probably always will be — a surplus of free content. But that’s like saying there’s a surplus of free food in the dumpster behind the alley.” Ev Williams [1]

“Will people just lower their standards? Perhaps. In fact, our standards have been gradually lowering for years. We’ll read crap on the web we wouldn’t have put up with in print.” Ev Williams [1]

Free Content Isn’t Necessarily Crap

I don’t read “free crap” on the web. The posts that I read on Medium aren’t the content equivalent of the free food in the dumpster.

I always have a Kindle book or an Audible audiobook as an alternative. I read a free Medium post, because I think I’m going to get something out of it. The cost of a Kindle book is irrelevant to me compared to the time I invest in it.

Who decides that the premium content on Medium is better than the free content on Medium? What is the decision criteria?

A Medium post is premium, because its author decided so. Outside of the no marketing rule, there are no criteria that separate a premium post from a free post, as far as I can see.

What’s the motivation to provide outstanding content on Medium?

A writer can have several motivations.

  • Spread ideas.
  • Get some exposure.
  • Build an audience.
  • Market products or services.
  • Make some money.

A paid membership website isn’t the best way to spread your ideas, get exposure, and build an audience. Marketing isn’t welcome in premium posts. Money isn’t significant either.

“In February 2018, 56% of authors who published at least one story for members earned money — making $58.45 on average for the month.” Medium Marketing Message [2]

Sure someone made $9K in a month, and a post made $1K, but those figures are possibly outliers. They probably don’t represent a reliable income. If I were that writer, I wouldn’t get a mortgage counting on that $9K monthly income.

Buy a Membership to Support Medium

You might argue that you have a Medium membership, because you want to support Medium’s cause. I acknowledge that. I donated to Wikipedia and other non-profits in the past.

I could buy a Medium membership to support it. However, that’s not the point. Medium doesn’t ask us to donate them money.

Medium is trying to sell us something as a for-profit company. There’s nothing wrong with that. I evaluate Medium as a commercial product, not as a non-profit.

Conclusion

Medium’s premium program doesn’t provide sufficient value to the consumers. It doesn’t offer enough value to the writers either.

If the subscription model can’t satisfy the primary stakeholders, how is it going to become a sustainable business?

The subscription model doesn’t convince me, but there are other business models that Medium can use. I’m going to publish a post about one of them tomorrow.

Your Turn

  • What do you think about Medium’s subscription-based business model?
  • Are you a premium member?
  • If so, what made you a premium member?
  • If not, what keeps you from becoming a premium member?

Use Your Curiosity as Motivation and Ask the Right Questions to Succeed

In a previous post, I explained how you can use the scientific method to work toward your goals. The idea is to define your goal as a hypothesis to test in the world.

You define the conditions of the experiment, the steps you’re going to take, execute those steps, and figure out whether those steps will lead to your goal or not. If they don’t, you either adjust your goal, or the conditions, or both. Then you execute the experiment again.

An important part of experimentation is to collect data. You can use that data to interpret your results. Based on your interpretation you can adjust your experimental setup and/or the actions you take.

Sometimes, you don’t need to collect data with your own experiments. You can simply use the data collected and published by others.

Start by Asking the Right Questions

In either case, you need to start the project by asking some quality questions. Here are a few questions I’m asking myself about my blog. If you have any answers to these questions, please let me know in the comments.

  • How can I build a business around my blog?
  • Which products and/or services can I provide to my Medium followers and email newsletter subscribers?
  • Which products and/or services would my Medium followers and email newsletter subscribers want from me?
  • What percentage of my followers and subscribers would purchase that product?
  • What is the potential of the maximum number of followers and subscribers?
  • Given that I have 475+ followers, 38 subscribers, and approximately 10% weekly growth rate, how long would it take to get to that potential?
  • What would be the revenue potential of that product?
  • How long would it take to fulfill that potential?
  • How can I follow up once that potential is fulfilled?

These are the questions I need to think about and research. Moreover, I can check other bloggers who have successfully built businesses using similar tools. What were the answers to these questions for those bloggers?

I have two more questions about blogging.

What is the optimal blog post length?

I like to read lengthy, information rich blog posts. When I come across such blog posts, I bookmark them and I refer to them over and over.

Obviously, it’s not easy to come up with such a post every day, because my blog is a side project for me. That raises the next question.

What is the optimal posting frequency?

Since November 18, 2017, I published a blog post per day. Is that the optimal frequency?

When I publish a post per day, it’s not easy to get over 1000 words every day. When I look at my Medium stats, posts that are over 1000 words seem to do better.

Moreover, publishing every day has another disadvantage. It doesn’t leave sufficient time to consume quality content, books, audiobooks, and blog posts. Without sufficient research, the quality of my blog posts suffer as well.

On the other hand, I see bloggers like Seth Godin publishing every day, but keeping the length of their posts short. Would that work for me?

What are the options for posting frequency?

The options seem to be the following.

  • Publish every day. Keep the posts short. Have enough time to research.
  • Publish every day. Keep the posts medium length. Not enough time to research.
  • Publish once a week. Publish long, information rich posts. Have enough time to research.

I am a little suspicious about posting less than every day. I have the feeling that I wouldn’t work as hard on my blog, if I didn’t post every day. On the other hand, the resulting posts could be more interesting.

A way to overcome the tendency to slack off could be to dedicate a certain amount of time each day on blogging even if I don’t publish every day and to write a certain number of words every day.

Maybe, I should experiment with that idea for a month and see what the results will be. If I could maintain the 10% growth rate with that approach, I believe that approach would be better. If not, then I’d better return to daily blogging. What do you think?

Conclusion

I like to think about a goal as a scientific project. I like to ask a set of quality questions. I try to answer them through reasoning and experimentation.

Collecting data during the experimentation helps the process. Another approach is to use the data already collected and published by others.

In today’s post, I asked a few questions about my blog that I’d like to answer in the following months. If you have any answers to the questions in this post, please let me know in the comments. Your ideas and feedback are welcome.

A Buddhist Monk’s Take on Business

Today’s post will be about a different approach to business and life. It will be about the work of a Buddhist monk / businessman, Geshe Michael Roach. Geshe is an academic degree, like PhD, in Tibetan Buddhist tradition.

In some cases, the business lessons of Michael Roach seems to differ from what we learn from traditional Western sources. In other cases, both traditions seem to match each other. I want to discuss a principle from his book, Karmic Management: What Goes Around Comes Around in Your Business and Life.

Michael Roach has another book called The Diamond Cutter: The Buddha on Managing Your Business and Your Life. In that book, he discusses common business problems and their solutions. I recommend both books, not only for businesspeople, but also for everyone who works as an employee.

A Holistic Approach to Business

In the Western tradition, when we think of starting a business, we think of how we can maximize our profits. In some cases, we also think about how we can benefit the customers. Michael Roach has a more holistic approach to business.

He argues that in order to be successful and sustainable, a business has to benefit its suppliers, employees, customers, and humanity at large.

In the Western approach, we try to minimize the costs of suppliers and employees. In most cases, we ignore the humanity at large. And we want to provide as little as possible to the customers that we can get away with. How sustainable is such an approach?

Suppliers

If you think about it, Michael Roach’s approach is simple common sense. I must say that this idea has changed the way I looked at business. Up until then, I used to purchase the cheapest option provided by my suppliers, for example in case of web hosting.

After learning Michael Roach’s approach I became more liberal with my spending. I changed my hosting to SiteGround and I don’t regret that decision.

Even though not the same, this idea also reminds me of Dan Peña’s approach of spending 125% of the income of a business in order to facilitate a fast growth.

Employees

The intuitive approach is to minimize the number of employees to maximize profits. As a result, we try to do as much as possible ourselves. You don’t have to be a businessperson to hire another person and make use of their services.

I met many people not wanting to hire a cleaning service for their homes, because they think it would be an extra cost on their budget. But think about how much an hour of your time costs and how much an hour for cleaning services costs. If you do the math, you’re losing money by not hiring a cleaning service, if your hourly rate is greater than the hourly cost of a cleaning service.

Think about all the tasks that you’re doing that you can delegate to a virtual assistant. Tim Ferriss is advocating the use of a virtual assistant in his book the Four Hour Working Week.

By hiring a virtual assistant, you’re taking advantage of the income inequality between developed countries and developing countries. This is completely ethical and moral, because by hiring them, you’re contributing to the reduction of this inequality.

Treating your employees well, providing them with the benefits and education is critical to attract good employees and to engage them. With websites such as Glassdoor, it is not a secret anymore what’s going on in a company. Candidates look at those websites before they are making their decision to apply to a job.

Customers

The third component of the business, customers, receive considerable attention in some Western companies as well. Getting and maintaining the goodwill of the customer is critical for the success and sustainability of the business.

Back in the day, some businesses were built on the idea that a sucker was born every minute. They thought they could cheat a person out of their money and that wouldn’t matter, because they would find another person to cheat after that.

Needless to say, this is a horrible idea in the age of the Internet and transparency. Nowadays, as soon as you cheat someone out of their money, they immediately go to Internet to complain about your business. A simple Google query on your business can easily expose all the complaints about your business and that’s a recipe for disaster for your business.

The opposite of that statement is also true. The best marketing is word of mouth marketing. If you provide the best products and services for the best price you can provide, you don’t need to worry about marketing. Your customers will do the marketing for you.

Think about a company like Google. Their services for the general public is free and they are already dominating the market, but they are still providing great experience to their users. For example, when I’m not sure about the usage of an English term or idiom, I type it in to their search box and their autocomplete functionality shows me the correct usage, which is a great help when writing a blog post.

Humanity at Large

Humanity at large is usually ignored when making business decisions. Think about the impact of your business on humanity at large. How would the world look like if all the businesses in the world acted like yours? Would the world be a better place for everyone or not?

I believe we will be considering the impact of businesses on the environment and humanity more and more in the future. People, at least the ones with disposable income, will be buying more from ethical businesses. Being an ethical business will be a marketing asset in itself. Think about recent trends such as electric cars, renewable energy, fair trade, and organic farming.

Transparency in the Age of the Internet

If you think about it, Michael Roach’s karmic management principles are based on the well-known win-win principle. As the Internet increases transparency, the benefits of karmic management principles are amplified.

Companies can’t maintain a positive façade, while abusing their employees, suppliers, customers, the environment, and the humanity at large. Those abuses are reported immediately on the Internet and they will be a dent in the marketing efforts and hence in the business of a company.

Summary

As Gary Vaynerchuk says, “karma is practical.” That statement will be more and more true as the world becomes more and more transparent thanks to the Internet. In the age of the Internet, the sustainability and success of a business will depend on the value it provides to its suppliers, employees, customers, and humanity at large.

Supervisors, in Service of Their Subordinates or the Other Way Around?

There are two approaches when it comes to the working relationship between a supervisor and their subordinates.

The First Approach

According to the first approach, supervisors are there to facilitate the best performance of their subordinates. The supervisors aren’t expected to do the job, but they are expected to guide, lead, and evaluate the work of their subordinates.

A supervisor who is working on a job that they can delegate to their subordinates is actually wasting their time. They are not only wasting their time, but they are also getting less performance out of their subordinates who may perform better if they are guided by the supervisor.

In this approach, the subordinates won’t be able to receive much guidance from the supervisor, because the supervisor is busy with a job that they can delegate to one of the subordinates.

Sure, the supervisor might be more efficient on completing the task by themselves. However, they are not only responsible for their own output. They are responsible for the output of their entire team. By focusing on maximizing the productivity of the entire team, the supervisor can create greater output compared to just focusing on their own productivity.

The Math

Let’s do the math. Suppose that a supervisor has five subordinates. The supervisor can produce 100 units of value per time unit. A subordinate can produce 50 units of value per time unit without the guidance of the supervisor. The same subordinate can produce 80 units of value per time unit with the guidance of the supervisor.

If the supervisor allocates all of their time on guiding their subordinates, they will produce no value by themselves, but their team will produce 5 x 80 = 400 units of value per time unit.

If the supervisor allocates no time on guiding the subordinates, they will produce 100 units of value by themselves and their subordinates 5 x 50 = 250 units of value. In total, this amounts to 350 units of value per time unit for the team.

In this example, it was more productive for the supervisor to not do the job themselves but to allocate all of their time to guiding their subordinates.

The Reality

Of course the number of subordinates a supervisor has, their productivity, and the guided and unguided productivity of the subordinates are not always the same in each situation.

In some teams and situations, that calculation will favor the supervisor not guiding their team at all. In other situations, it will favor the supervisor spending their whole time on guiding their team. Yet in other situations, the optimal solution might be somewhere between these two extremes.

I’m convinced that the supervisor not guiding their team at all is not the optimum solution, but again this depends on the team and situation. There might be exceptional cases, where this might be optimal.

To which extend should the supervisor commit their time to guiding their subordinates?

100% might be impossible, because the supervisor has other duties as well. But should it be closer to 100% or closer 0%? Or somewhere in between? My hunch used to be closer to 100%.

I was happy to learn that Gary Vaynerchuk, a successful American entrepreneur, also thought in the same direction as me, as far as I could understand from his book, #AskGaryVee: One Entrepreneur’s Take on Leadership, Social Media, and Self-Awareness.

Then I read the article Management Time: Who’s Got the Monkey? By William Oncken, Jr., and Donald L. Wass in the book HBR’s 10 Must Reads on Managing Yourself. This article advocated an approach that is closer to 0% of the supervisor’s time allocated to guiding their subordinates.

It was a good article and I started to apply the ideas in this book in my working days to the extent possible. I must say that this article made a difference in how I approach my working relationships with my colleagues.

Empirical Results

After experiencing both approaches, I must say that both approaches have their merits. Intuitively, the first approach seems to be the better one to me. It makes more sense. However, I must admit that every team and every situation is different.

What works on one team wouldn’t work in another team and the other way around. Supervisors and teams need to find their own balance. They need to find which approach works best for them.

If a supervisor can extract more productivity from their team by sacrificing their own productivity and guiding their subordinates, they should do that. If that guidance doesn’t result in extra productivity to the extent that it justifies the productivity sacrificed by the supervisor, they shouldn’t do it.

Bottom Line

The bottom line of this post is not to argue that one approach is better than the other. The bottom line of this post is to point out that the percentage of time that a supervisor allocates to guiding their subordinates is a variable that a supervisor can optimize in order to maximize the overall productivity of their team.

In order to do that, the supervisor needs to let go of their preconceived notions of what is the right thing to do and approach this problem as a variable that can be optimized. Flexibility and open-mindedness is the key qualities here.

Your Turn

What’s your take on this subject? Which approach works best for you? Are you ready to experiment with the opposite approach or would you rather stick with your current approach?

How to Monetize Medium

What could be an alternative to the premium membership model of Medium?

Medium is a social platform that focuses on long form text based content. This type of content isn’t appreciated as much as it used to, because of the switch to mobile devices.

I’m a big fan of Medium as a writer as well as a reader. As a writer, I import all of my blog posts to Medium. I appreciate the views, reads, claps, responses, and private notes I receive on Medium as well as the followers.

Medium gives me the opportunity to be featured by online publications with tens of thousands of followers. This gives me an almost instant reach to their audience. If you’re just starting out as a blogger, those numbers are well out of reach, unless you stir up waters in social media.

Moreover, I like the interaction with the editors and reader of those publications. I learn a lot from them. The themes of those publications are steering me towards certain topics such as entrepreneurship and investing.

As a reader, I get to read the posts of writers who are enthusiastic about what they are writing about, not to promote their latest online product. The Medium posts that reach my recommended list have a higher standard than other social platforms; much higher.

In summary, Medium is a fantastic platform for people who like to write and read long form text based content. They do a great job managing this community. But at the end of the day, someone has to pay for all of that great job.

Current Business Model of Medium

Medium’s current model is based on selling premium membership. Premium members get to read the premium posts. As far as I understand, the only difference between a premium post and a free post is that the author decides to offer their post as a premium post. In return, the author gets some fees based on how well the post is received by premium members.

Medium’s premium membership is not compelling enough for me to buy a subscription. First of all, my reading, listening, and watching lists are already full of free content. Second, my reading and listening lists are also full of premium Kindle and Audible content. Both lists would take me a few life times to consume. Medium’s premium membership is squeezed somewhere in between the tons of quality free or low price premium content.

Now, you can accuse me of being stingy and tell me to cough up the $5 per month to keep my favorite social platform afloat. Sure, I can do that, no problem, but it’s not only up to me. In order to succeed with a fundraiser, it has to be announced as such.

At this moment, the premium membership is marketed as something that would add value to my life. I don’t see how a premium Medium membership adds any value on top of the quality free and low cost premium content available.

The issue here is not money, but the time to consume all the content that is already offered. I pay for premium membership of Spotify. I buy Kindle books. I have an Audible subscription. I’m convinced of the value offer of these products and services; and I use them.

If Medium announces a fundraiser, I’m willing to contribute, as I contributed to Wikipedia multiple times. But as we all know, Wikipedia has a different structure. They are a non-profit. I don’t think all the venture capital investors of Medium would be willing to accept that.

If membership wouldn’t work for Medium, what would?

Medium can use the promoted post model of Twitter and Facebook. I know this sounds scary to a lot of Medium fans, but stick with me. Forbes has something called Brand Voices, where corporations pay to promote their posts on their platform. The promoted post system also works fine for Twitter.

There is a conflict of interest when you use the promoted post model. On one end of the continuum, there is Medium, where writers pay nothing to publish their content. On the other end of the continuum, we have Facebook, where the only way to get your content in front of eyeballs is to pay.

The Medium model results in high quality posts and publications bubbling up to the homepages of readers. We all know what the Facebook model results in, but they make money. However, there are infinite points in between those two extremes.

Medium can receive promoted posts and they can adjust their algorithms to turn profits, sufficient enough to satisfy their investors without going full Facebook. The Facebook model reached a point where it isn’t sustainable anymore. They want to fix it as well.

Another argument against promoted posts could be that Medium has already tried this. Times change. An idea that didn’t work a few years ago could well work now with a few twists. It’s well worth trying if it would keep Medium afloat. The only alternative I can see is Medium going non-profit.

What I definitely wouldn’t like to see on Medium is those shady online marketing ads that we come across even on the websites of established publications.

Summary

The premium membership model doesn’t offer enough incentive to users to purchase it. It has to compete with an abundance of free and premium content available online. Promoted posts would be an alternative. A balance between user experience and profits needs to be maintained to keep the business sustainable.

There are two more alternatives. The first one is going non-profit, which would be the last resort given the venture capital Medium has already received. The second one is receiving ads, lots of them, which would reduce the user experience.

How to Develop Superpowers in Business and Relationships

It all comes down to one simple principle.

The pain and pleasure principle can be used to understand all human behavior and to modify our behavior. This is a superpower in itself. Today, we are going to go one step further and discuss how we can use this principle to modify the behavior of others, which is an even greater superpower.

Ethical Concerns

Before we continue I want to address a possible objection. You might think that using the pain and pleasure principle amounts to manipulation and it is unethical. I get this reasoning. However, there are several arguments in favor of learning the use of this principle.

First of all, almost every authority and business is using the pain and pleasure principle. It’s the easiest and most effective way to control and influence people. Think about all the ways the society is rewarding and punishing people.

By knowing how the pain and pleasure principle is used, you become more immune to manipulation.

Moreover, you can use the pain and pleasure principle constructively to motivate people to create positive results for everybody involved. It is only unethical, if you use it to manipulate people to their disadvantage.

Creating Addictive Products

The pain and pleasure principle is heavily used by B2C Internet companies to make their users addicted to their products. These products measure user engagement and feature the content that is most engaged with. They filter out the boring content and emphasize engaging content.

There might be a life changing, text only content on a social media platform. Such content will most probably go unnoticed, shortened, and squeezed between flashier images and videos. That’s why most bloggers use flashy images and online copywriting principles such as short paragraphs, subheadings, bullet points, and quotes.

Sales and Marketing

Salespeople and marketers know how powerful the pain and pleasure principle is. They take full advantage of it. They determine all the pain and pleasure points of a prospect. They exaggerate these points and the effects of their product.

You might hear an insurance salesperson exaggerating the probability and effects of a rare event and how their insurance will save you from that.

Unfortunately, a lot of money changes hands without real value in return, because of effective sales and marketing.

Management of Employees

The 20-70-10 rule of Jack Welch is an effective way to motivate employees to perform at their best.

The 20-70-10 rule is completely based on the pain and pleasure principle. In this model, top 20% of the employees are rewarded with promotions, raises, and bonuses. Bottom 10% of the employees are fired.

You might think that the 20-70-10 rule is a ruthless system, but think about the opposite. What would motivate an employee in a company where nobody advances in their career and nobody is held accountable for not performing?

Relationships

The pain and pleasure principle applies to all kinds of relationships, including private and professional. Now, think about a person who’s always nice to their partner, friends, and colleagues. You might think this is the ideal behavior. In reality, that person is doomed to become a doormat in their relationships.

Now, think about a person who’s being a jerk to their partner, friends, and colleagues all the time, indiscriminately. There are some choice words for such people, which I won’t mention in this post. Such a communication strategy doesn’t work in real life, as documented in the book No Asshole Rule by Robert Sutton. (Oops, I did it :))

By pain, I don’t mean to whip your partner.

As in every area of life, the pain and pleasure principle is effective in relationships as well. Please, don’t get me wrong. By pain, I don’t mean to whip your partner. I mean giving the necessary feedback to your partner, friend, or colleague, whenever necessary. This is a painful process for most of us.

Don’t forget the pleasure side of the principle. We humans associate a higher weight to pain compared to pleasure for evolutionary reasons. That means giving more positive feedback than negative feedback is necessary. The ideal ratio seems to be five-to-one.

Summary

The pain and pleasure principle is not only useful for modifying our own behavior, but also for modifying other people’s behavior. Becoming aware of it can save us from the manipulations of others. Using it effectively and ethically can improve our success in our jobs, businesses, and relationships.

Doing Nothing is Not Wasting Time

There is an obsession to take action in the modern western society. This obsession has its upside as well as its downside.

Taking action is great, if the action you take is a significant step towards your most important goals. Let’s be honest. Most of the time, it’s not.

Most of the time, our motivation to take action is other than making a significant progress towards our most important goals. Most of the time, we either want to look busy or we want to distract ourselves.

Busy Work

Busy work is one of the main time wasters in companies, second to tech addiction. You’ll find employees wasting their time on busy work instead of working on something valuable. Companies that don’t incentivize their employees with promotions and bonuses are actually encouraging their employees to get involved in busy work.

If you want to learn how economic incentivizing works in human beings, I recommend the audiobook Thinking Like an Economist by Professor Randall Bartlett, which can be found in audible.com.

What is the rationale of the employee that is not going to get any promotion or bonus? They only work so much to keep their job. They do the simplest work. They are more interested in looking busy than being actually busy.

Doing something essential is hard and risky. Doing busy work is simple and easy. Without sufficient incentives, employees tend to be drawn to busy work, because they are paid by time, not by the value they produce.

Doing Nothing

Contrary to the employees, you won’t find many self-employed people engaging in busy work. They know intuitively which activities produce value and which activities don’t. They’d rather do nothing than getting engaged in busy work. They intuitively know that doing nothing is more valuable than busy work.

The Benefits of Doing Nothing

By doing nothing, you give your mind the space to process your experiences and challenges and come up with new ideas and solutions. Your mind won’t have that opportunity when you keep yourself busy all the time.

Doing nothing also gives you the space to reflect on more abstract topics, such as long term opportunities, threats, and strategies. You need that long term view to find a direction for your life and work. If you do it right, doing nothing can be one of the most valuable things you do.

What Doing Nothing is Not

Doing nothing is doing nothing. It is not watching TV, not surfing the Internet, not chatting with your friends, not hanging out in cafes and bars. It is relaxing in a calm, silent environment. It is not distracting yourself in any shape or form.

Summary

Doing nothing is more valuable than distracting yourself with tech and busy work. Employees are encouraged to maximize their working hours, which incentivize them to do busy work. Busy work is simple and easy, but doesn’t produce much value. Self-employed people intuitively know that they have to maximize the value they produce per time unit.

I invite you to look at your working patterns. Are you more engaged in busy work or do you try to maximize the value you produce per time unit?

How to Grow Your Online Business

I received a comment from a young entrepreneur, Jan, who wanted to discuss ways of growing his online business. I researched this topic and experimented on it considerably in the past and here’s what I have found. The post is composed based on the comment of Jan. So, if you have further questions or remarks, please feel free to reach out to me with comments or private messages with the contact form.

Ad Networks

The major ad networks AdWords, Facebook Ads, and Bing Ads are expensive. They are useful in two cases. The first case is that you already have a profitable business and you want to accelerate it. The second case is you have cash to burn and you want to experiment, a.k.a. gamble. In the second case, your goal is to find a cash flow positive business model.

I have experimented with the second case and didn’t succeed. I came to the conclusion that the only way to create a profitable business is through good old hard work. Once you develop a cash flow positive business model through organic methods, then you can use online ads to accelerate it.

The major ad networks reward the first strategy by offering you cheaper ad placements. They punish the second strategy by offering expensive ad placements to the not-so-well-established websites.

Google Analytics

I find Google Analytics to be a distraction for the starting solopreneur. Once you have Google Analytics set up on your website, guess what you do the whole day? Yes, that’s right; you check the number of visitors visiting your website the whole day, instead of creating valuable content and building relationships with other content creators and potential customers.

If you grow your business to a certain size and you have to start making decisions, such as which promotion method to invest more time and money, then you can set up Google Analytics to make those decisions.

If you’re a starter and your number of visitors don’t add up to a meaningful sample size, it doesn’t make sense to waste time and effort on Google Analytics.

The Best Way to Go

The best way to promote your business is through hard work on social media. The first question to ask yourself is what do you like to do the most. What comes natural to you? Do you like to write Facebook posts? Do you like to participate on Twitter? Do you like to write blog posts? Do you like to create images with quotes on them? Do you like to record audio and publish it as a podcast? Do you like to shoot videos and publish them as vlogs on YouTube? Do you like SnapChat? Do you like to answer questions on Quora? Do you like to use another social media channel that isn’t mentioned here?

Find what comes natural to you. Find the one medium where you can create valuable, premium quality content on autopilot like a machine. Focus on that medium, produce and publish massive amounts of valuable, premium quality content. Next to that focus on building relationships with other content creators and potential customers. Once you have done that you can add other methods on top of those methods, such as adding other social media channels, or using the ad networks.

Whatever you do, don’t expect to get massive results within two years. As a matter of fact, don’t expect to get any results at all. If you are in need of urgent money, get a job. If you want to build a business that would bring you long-term value, be ready to invest at least two years of your life without seeing any result in return.

Nowadays, my medium is writing blog posts, publishing them on my blog, importing them to Medium, participating on Medium responding to other content creators’ posts, and participating on Twitter. There are dozens of other channels out there that I can use, but I want to focus on this chain first to build a base and then add on op of that step by step. Maybe I wouldn’t add any other channels at all.

How to Monetize

Don’t start a business with the question “how can I make money?” Start a business with “how can I add value?” When you add sufficient value, the market will find a way to compensate you. This is counter-intuitive, but this is how it works in this day and age. Not the other way around.

In the past, I started websites with the only intention of making money. The first thing I’d do is to find something to sell, such as products on Amazon, Audible, ClickBank, or other affiliate programs. I’d then create content around channeling my audience to those avenues. That doesn’t work anymore, if it ever worked.

My strategy now is to create 1000 diehard fans, provide them insane value for free, and let them tell me what I can do for them they’d pay for. If I can’t create those 1000 diehard fans, then it doesn’t make sense to develop a product in advance and trying to sell it to random people online. So, that’s my benchmark to start creating a product or service. I expect that to take me six months to two years. So, before that benchmark is hit, you won’t see me selling anything here.

SEO

I don’t believe in hacking your way to fooling search engines to sending you more traffic. Especially, using obvious techniques such as link exchanges are easy to detect and ignored, if not punished, by the search engines.

Here’s the mindset I have on SEO. When I start a website, I completely ignore the search engines. I act as if they don’t exist. I try to create the most valuable website that I can create and try to grow it in organic ways as explained above. I see the search engine traffic as by-product, not the main goal. People who see the search engine traffic as their main goal are one Google algorithm change away from getting broke. It happened before; it will happen in the future.

By the way, importing your blog posts to Medium through their importing tool would improve your SEO.

References

I’d like to say that I was the top expert on this issue, but I’m not. I have some experience over the years. When it comes to online marketing, the only person I look at is Gary Vaynerchuk. I listened to all of his books on audible and checked his book Jab, Jab, Jab, Right Hook on Kindle. I believe Jab, Jab, Jab, Right Hook is the right place to start. And of course, his podcast is a great, free source to learn from.

Be careful that this is time sensitive information and try to grasp the mindset instead of the techniques. Because the techniques change over time. The techniques that worked last year might not work this year. However, once you get the mindset of the Jab, Jab, Jab, Right Hook, you’re set up for life. I have learned the concept of 1000 true fans from Tim Ferris’s book Tools of Titans.

If you have more comments and questions, let me know in the comments below or via a private message. Thank you.