the onda

Well it seems like after the suspension of disbelief that was 2006 as far as making money from social sites, web 2.0 mashups, etc., we may see 2007 as the year when people start asking themselves that question in earnest. All of those eyeballs have got to turn into dollars after all, and thus far Rupert Murdoch seems to be the only guy who's been able to do it right.

The signs of change are in the air: YouTube— despite its new corporate parent's deep pockets— is making noise about pre-roll ads and revenue sharing, Microsoft is looking to take on Paypal to facilitate online payments, and even Businessweek is jumping into the fray with pieces like this one which argues that we're now going to need the serious venture bucks to build out the "real businesses."

At the end of the day though where all of these social sites are concerned, you either have an audience that advertisers want to pay for, or a base of potential customers that can be incented to spend money. Google, Yahoo, and all of the rest of Web 2.0 fall into the former camp, and innovative new companies like Smugmug, Cafe Press, and Tabblo fit into the latter.

For our part, after having spent six months building an initial member base that was attracted to the Tabblo service (either because of the editor, the online/offline combination, or the quality of the products we make), we're now starting to experiment in earnest with products that will begin to motivate members to buy at greater frequency than most other output vendors.

Tabblo Valentines, which we are launching today, is an interesting first experiment in this regard for a few reasons. First, at $1 including shipping, it's a relatively low commitment to try. Second, Tabblo Valentines are an offering that builds on all of the core parts of the free service that we've built over the last year. The same editor, the same mix of photos and words, and most importantly the same focus on collaborative/social content creation. So it will be really interesting to see whether these elements when combined get us to something more interesting than "yet another site offering some Valentine card gimmick." Finally, the inclusion of a relatively small feature, auto-addressing makes the Valentine product something that is really interesting in the context of an online community.

Most people who meet online don't know each other's physical addresses— usually not a problem (and sometimes an advantage). However there are times when it really is nice to interact in meatspace which is why people still read real books and like to get real cards. This is what auto-addressing is meant to fix. By letting Tabblo be a blind intermediary in handling the addressing and shipping of the package, it becomes possible for members to strengthen their online ties offline without doing too much work or feeling awkward about it. And in doing so, we're also lowering the friction usually involved in sending real mail (a nice thing to do despite living online).

This is the first step in what is going to be one long experiment with our business model— focusing on the types of physical products that make sense for our online community— however this seems like a very timely experiment now that 2007 is here to stay.