Ricky’s Online Business Blog

Have you been invited to join various specialized Facebook groups lately?  For example, “Malaysia Badminton Network” for badminton lovers and “Malaysia Web Designers” for web professionals?

Yes, I have been joining some of these groups. Also learning about this new way of making money – building recommender community groups on Facebook.

Correct me if I’m wrong. But it works like this:

1. Decide on your passion, such as table-tennis or reading books.
2. Create a Facebook group around your passion, such as “Malaysia Table-Tennis Network”. Decide on what you can offer your group members.
3. Invite your friends on and off Facebook to join your group. Aim for the number.
4. Keep posting useful messages to group members to build your credibility, and make sure they get something beneficial out of joining your group!
5. Once you have reached a critical mass, such as 1000 members in your group, start leveraging the number to make money!

For example, you can contact sport organizations and companies to sponsor events, contests and prizes for your table-tennis sport group. You can help these sponsors sell their products. In return, you may get a cut of the profit.

Another example I’ve witnessed a book love group are doing. They leverage on their high number of members to negotiate with MPH to gain discount for their members.

I don’t know exactly yet how to translate number of members into profits, since I’m not there yet. But since you are leading your many group members now, you have the influence over the group members and “recommendation power” to talk to businesses interested in your group as their target customers.

And once you have achieved success with one niche group, start another group (better be related, I supposed), and leverage on the first group to promote the second!

Just announce to the first group that you have created a second group, then many of them will join you since they already trust you!

Does this business model work? I don’t know. But according to one Internet guru, building recommender community groups is one of the most profitable ventures on the Internet.

And what do you think?

When one comes to developing an online business, which is more important?  Profit first, or market share first?

I heard some say that market share, or “mind share”, is first and foremost important.  When many people have got to know a dotcom brand, they will visit the web site,  the “eyeballs” will be so increased, the “critical mass” will be so achieved, the “branding” will be so built up, and naturally the profit will come.

On the other hand, others think that profit should be the first to focus on, not market share.  A business can grow its market share so much that it is still not profitable.  It can command a large market share yet sacrifice the profits that could have been earned during the growth.

One typical example is a membership business online.  Shall we first focus on market share by giving out free member accounts in order to first attract the mass, and then try to sell some premium services later to them?  Or shall we start with a chargeable membership so that we can starting earning right from the first day?

Perhaps profit should be our first objective.  And as we do things the right way towards the objective, market share is a natural result.  What do you think?

Yes I admit I’m a blue ocean strategy fan.  My PC desktop is an ocean viewing.  I even tend to look at everything through the lense of blue ocean vs. red ocean.

The problem is, we just can’t ignore competing in the red ocean, whether now or in future.  Perhaps our industry is still red.  Perhaps a blue ocean will also turn red after some time.  Competitive strategies still have an important place in business and marketing.

I heard that a telecommunication company in Malaysia has two teams of people planning their business strategy, one called “Compete Today”, another called “Compete Tomorrow”.

As the names suggest, the “Compete Today” team plan strategies to outsmart their competitors in today’s market.  Whereas the “Compete Tomorrow” team brainstorm and explore new markets and plan strategies for the future.

So I’m learning not to just look up to anything “blue ocean” as good and look down on anything “red ocean” as bad.  A more holistic perspective is required.