In case anyone wonders what the * signifies, it’s a convention in mathematics for the dot cross-product. This means that the multiplier and sum effects produced by matrix constituents is greater than the parts.

PROGRESS WITH PRINCIPLES IN PRACTICE

HAPPY NEWS: We’re now closer to pinning down the who-what-when-where-why-and-hows of Project ART making money. Plus it’s now more clearly established that our platform will exist to service a well-defined and identifiable market opportunity and client base. The entire process so far is reminding us of the importance for companies to align interests with clients from the outset, on-and-offline. Luckily, my business partners are with me on the same plane of values wrt these points:

(1.) Participants on our platform will be incentivised, rewarded and valued.

(2.) Credibility is a key must-have.

(3.) There’s always room for improvement, so it’s our responsibility to others to seek it out.

I love it when people put their thinking caps on and strive together towards the better!

PROSPECTING FOR DIGITAL GOLD

Now it’s well-known that revenue models are the Holy Grail (and booby trap) for all businesses — whether they’re the likes of Newscorp or the newco dotcom. Those who work in the Internet sector have become increasingly familiar with the following:

· Member subscription (borrowed from trade publication models)

· Pay-per-View (borrowed from satellite and cable operators)

· Google Adsense (Internet innovation)

o Cost-per-Click (CPC)

o Cost-per-Mille (CPM)

o Cost-per-Action (CPA)

· Sponsorship and endorsement revenue (borrowed from sports operators)

· Affiliate revenue (CPA replacing CPC and CPM models, borrowed from car retail outlets and beauty franchise models)

· Subscriber data access (borrowed from information services model)

· Members as paid focus groups (borrowed from marketing + polling businesses)

In my view, it’s equally important to consider the offline measures needed to complement and drive online strategies. It’s no longer a question of bricks+mortar versus clicks+portals as we witnessed during Web 1.0. Nor is it the relationships networking and social recommendations which we’re seeing in Web 2.0. It’s actually probably some hybrid of complementary contextualized clicks with rewarded customer collaboration.

[At least, that's the model I believe in and am building towards --- lol, my digital gold detector @ work.]

WHAT WORKS ON THE WEB TO-DATE AND INNOVATIVE WAYS FORWARD

Obviously, there are other revenue streams and without exception all Internet plays have explored one or more of the above options at some time-point in their business development cycle. Google, Facebook, Twitter and Apple apps store are constantly in tech sector news about their revenue opportunities:

· How Google grows and grows

http://www.fastcompany.com/magazine/69/google.html

· Facebook and how it can make money

·       Create a revenue model for Twitter and save innovation

http://www.businessinsider.com/2009/1/announcing-the-create-a-twitter-revenue-model-contest

http://www.readwriteweb.com/archives/help_twitter_find_a_revenue_model.php

·       Apple Apps store now a US$1 million a day business

http://www.geek.com/articles/mobile/analysis-app-store-now-1-million-a-day-business-cloud-mobile-apps-the-next-big-thing-20090424/

It’s great to note how leading techcos are evolving the Internet revenue model for everyone and increasingly extending it to enable users to earn money, e.g. Google’s AdSense.

ON*OFFLINE REVENUE: SHOW ME THE TWAIN!!!

Well, the revenue model in chemical companies is different from that in banking and that for dotcoms and PR is what I’ve observed so far — LOL.

The flavors and fragrances we developed in the labs were sold in bulk volumes and there were consultancy fees involved in us concocting and innovating physical end-products, which would make Cola Company A stand out from Cola Company B or FMCG A from FMCG B (fmcg = fast moving consumer goods as manufactured by the likes of Procter and Gamble, Unilever and all food retailers; we had household name clients which was a great insight for me as a teenager).

Wrt the Internet model, I’ve had direct experience of the revenue streams I list above as well as online trading, settlement and execution fees. This is distinctive to the financial services sector and is borrowed from the way traditional stock exchanges operate and how they earn income.

In banking, there’s a whole complex matrix of revenue opportunities which broadly breakdown into five main categories:

(1.) advisory and consultancy fees (e.g., for M+A and corporate restructuring)

(2.) market analysis fees (aka equity research reports)

(3.) product distribution fees (i.e., channels between the company issuing the stock and potential investors)

(4.) portfolio management fees

(5.) trading, settlement and execution fees

As for PR, this is the most simple and is, predominantly, consultancy fees for anticipatory, current and retrospective reputation management (the retrospective one is also known as “fire-fighting”) as well as analysis fees for focus group Q+A’s (usually in the form of a bespoke report).

REVENUE GENERATION IS CHALLENGING AND NEEDS NUANCED STRATEGY

What I’ve realized over time is that it’s about more than having the salesman’s “gift of the gab” or a marketer’s ability to promote and persuade a customer to convert-to-purchase. The key is, once again,………..STRATEGIC PLANNING + IMPLEMENTATION.

Companies need to think clearly about these three items:

(1.) incentivising customers to buy-into and participate with their company, product / service offering(s) and brand values.

(2.) structuring the channels to support front-line sales staff.

(3.) fostering ownership, democracy and flexibility over the value chain between the company and its customers.

Get those in a good shape and revenue will flow between various parties in a natural and organic WIN-WIN WAY.

Those statements aren’t offered based on cerebral idealism, but via sensible pragmatism and distilled experience. People whom I regard as role models, innovators and leaders have always exhibited this characteristic and I believe it’s a good revenue, life and value philosophy: win-win.

Incidentally, when I worked in the big bank I was a designated “revenue generator” so I do know a fair bit about business models. This is a distinction to be aware of because in banks less than 1% of the work force are revenue generators (aka we bring in the clients or are responsible for key investment portfolios). In film terms, we’re equivalent to the Tom Cruises / Julia Roberts / George Clooneys / Cate Blanchetts: we’re expected to generate box office gold and/or lend credibility to the product and the company behind it.

Everyone else is classified as “support” which means they’re not directly responsible for bringing money into the bank from clients, managing funds or rain-making deals. The assumption may be made that all Managing Directors are “revenue generators” but this isn’t the case at all. There were senior people who oversaw my work who were in the “support” bracket.

The challenges on revenue generators to perform aren’t the same as those for staff generally; we’re supposed to be the crème de la crème, the brightest of the best, the fittest and fastest in the jungle, the people dispatched to bat the ball right out of the park — preferably passing Pluto on its path — and to pull in and excite the crowds, and all other superlatives.

Of course, only a dolt dufus would let this go to their heads!

A normal, smart and reasonable person would remember that SHARING revenue generated fosters a much more interesting playing field. Revenue meritocracy and value democracy then become self-propagating and transformative.

ON*OFFLINE REVENUE MODEL: A TWAIN TEMPLATE

Now, in the interests of transmitting knowhow, this is the way I’ve structured the who-what-when-where-why-and-hows of Project ART generating income. For confidentiality and competitive advantage reasons, I can’t show readers the specifics; our model essentially combines the best of the way top Private Equity portfolios make money with how top Internet sites make money, all synergized with some Twain thinking.

In any case, even having a visual and systematic framework is helpful so here’s my share:

It’s unique and different from existing business models out there (on+offline), so we’re looking forward to its market implementation once the key pieces are in place and the platform goes live.