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Today Entrecard announced that members now can purchase entrecard credits. Currently 1000 credits are going for $9.50 inside the members section at Entrecard website. But I think they are quite over-priced. Because there are very attractive offers in eBay if you want to buy Entrecard credits. (see below)

Creation of Black Market?

As you can see, at eBay 7500 Entrecard credits are going for $17 only. And of course there are some even better offers too, like this one 20,000 credits with starting price of $0.41 cents only. I am sure it will catch high price before the auction ends in 4 days, but it will definitely be better offer than what Entrecard is offering.

It’s like the money market, where Government says our money is equivalent to this much USD. But in actual case, the value of the local currency is much lower (rarely higher) in the black markets.

So what is the solution?

So, what could Entrecard do to establish the real price of Entrecard credits? How much does 1000 Entrecard credits really worth? I think Entrecard could come up with their own bidding system, where users could bid for it. Moreover, this kind of system would allow other members to sell their credits too. Otherwise, at the moment only Entrecard is making money. And those high earning members do not know what to do with their credits. Of course, only solution would be to sell their credits at eBay for a very cheap price. Almost like getting rid of them.

What do you think Entrecard should do? Your thoughts on this…

Ping: entrecard.com/blog/

Update: Entrecard purchases credits from high earning members and sells back to the community.

Few days back I bought a new pair of jeans from Levi’s to replace my old one. Today I see this graph and I am thinking to myself “man I have wasted 2866 gallons of water“.

I do feel bad about it since there are more than 2 billion people who do not have access to clean water.

The World Bank reports that 80 countries now have water shortages that threaten health and economies while 40 percent of the world — more than 2 billion people — have no access to clean water or sanitation. source

Water shortages are likely to be trigger for wars, says UN chief Ban Ki Moon source

Since the future holds more water related problems, and since more and more people are becoming environmentally aware. Do you think jeans industry will have a major crisis like the diamond industry had?

And since Levi’s is the major player in the jeans industry and since it’s well known for its high quality jeans (and not for any of its other products) I think the firm will have a tough time dealing with this problem. Because as you can see, in order to produce a pair of jeans you need 2866 gallons of water!

What is your thoughts on this issue in general? As for Levi’s, I am sure the company will try not to abandon their jeans line. So what could be Levi’s next strategic moves regarding this issue?

Update: here is how the jeans are produced (and water spent/wasted) click here

US citizens now have a better deal when it comes to purchasing things online. People now can use Microsoft Live to find products, and get cash rebates when they purchase products through Microsoft’s Live Search Engine.

Under the cash program revealed Wednesday, Web shoppers who sign up for an account and buy items found using Microsoft’s Live Search cashback site will receive a percentage of the purchase price deposited into their account.

When the total reaches $5 (euro3.17), the shoppers can redeem their “cold, hard cash” via eBay Inc.’s PayPal. Microsoft said the rebates are funded with a portion of the money it collects from advertisers.

So far, more than 700 merchants, including Home Depot and Zappos.com, have listed products on the site reports AFP.

What it means to bloggers?

It means Microsoft is skipping the middlemen (like you and me) and working directly with the product sellers. So, now consumers can go directly to live.com and buy stuff, instead of going through other third-party referrers. Therefore, from consumers’ point of view it’s a great service. Google Product Search (previously froogle) has been around for some time already, but they have failed to come up with this idea. And I personally think, Microsoft’s cashback might actually work!

As for bloggers, I think it’s a matter of time before Microsoft involves bloggers in this program and comes up with a publisher program. Probably bloggers will be able to use Live’s “search form” on their blog and sites. When someone searches for a product from your blog and if the search results in a sale, then the blogger will be paid some percentage.

If Microsoft comes up with publisher program, then it will be competing directly with other publisher programs like WidgetBucks and Chitika. When this happens I wouldn’t wish to be in Chitika’s position ;)

search.live.com/cashback

iPod and Mobile software developer Koloroo has decided to make its products free, or in their own words “careware”. Its products include Color Schemer (for Windows, iPod, and Mobile Phones) and Tip Calculator (for iPod).

What, exactly, is careware?

Careware is free Koloroo software … with one tiny catch — before you download it, you must agree to do something nice for someone. And it doesn’t matter how big or small your act of kindness is. ~ Koloroo

People are already reporting acts of kindness that they have done or plan to do on this page. It’s great that Koloroo came up with this kind of innovative way to give its products for free which promotes social responsibility. (i should have ended the post here)

Constructive Criticism of Koloroo

Koloroo has robust software development and user interface design skills. However, I think they are wasting their skills and efforts on the wrong products that do not make sense (i.e not really useful). For example, their color schemer software for iPod. How you are going to use it? It doesn’t make sense to have a color selection tool on your iPod. It’s not practical at all, and its application in real life would be like zero!

Few weeks ago they have developed a PC version of their color schemer. My question is “Why didn’t they start with the PC version from the beginning?!” Because at least PC version would have been useful to graphic designers.

I am pretty sure that Koloroo’s recent decision to make its products free was because they were not selling well, there was no demand for them. So, probably they thought “why sit on the products that do not make money, let’s give it away for free better!”.

Koloroo’s case is the opposite of FSCapture case. FSCapture started as a freeware in the beginning, but once it became popular the author suddenly wanted to make money on it. But then again that’s life… most of the thing revolves around money in this life.

Lesson: Anything you do (i.e projects) do it with long-term vision in mind. And of course, do your homework (i.e feasibility study) before you launch any product to the market.

Guys at MarketLeverage.com are quite creative. They have found a novel way to get mentioned on top blogs like problogger (46K+ readers) and shoemoney (16K+ readers) with a small investment that the team themselves will enjoy wearing. They purchased these two blogs’ t-shirts and wore them and sent a picture of the whole team wearing the t-shirts. Guess what? They got dedicated post on both blogs. That’s what we call a win-win situation. MarketLeverage (win), two blogs (win).

Shoemoney t-shirts are just $5.00 each for both men and women, and problogger t-shirts are $17.99 for women and $23.99 for men. So, LeverageMarket spent about $50 on shoemoney and $132 on problogger (unless they bought double logo t-shirts, which are more expensive). It’s a fraction of what you would actually spend to get publicity on these high-traffic blogs, if you were to go through normal conventional way of advertising.

Moral of the post: Be creative!

If your business is running smoothly and if you have some great products that sell like hot cakes, should you stop investing in R&D? Maybe reduce the investment in R&D and reap the profits that is generated from your cashcow products? The answer is “No”. You should keep investing in R&D, you should keep coming up with great innovative products. Because success lies in continuous innovation, not in one-time innovation.

If Xerox stopped investing in Research & Development, it would be earning 60% less revenue:

More than 2/3rd of Xerox’s revenue comes from products launched in the past two years. source

Some companies like Sony believe in innovation so much, that, they would introduce new products even if those new products are going to kill its own current (cashcow) products. Because, Sony believes in creating “new markets” and not creating products for the existing markets.

Between 1950 and 1982 Sony successfully built 12 different new-market, disruptive-growth businesses. These included the original battery-powered pocket transistor radio, launched in 1955, and the first portable solid-state black-and-white television, in 1960. Plus: videocassette players, portable video recorders, the now-ubiquitous Walkman and 3.5-inch floppy disk drives, launched in 1980. source

So, as you can see, continuous investment in R&D is very important. Unfortunately, many small-to-medium businesses and some startups are usually stuck with few products. After developing few successful products they simply stop investing in R&D and stop coming up with new products. Rather, they resort to fixing and polishing the existing products. In some cases, years would past and the company would be still working on the existing products. What a sad situation that is.

If you start your own company don’t make this grave mistake of not investing in R&D!

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