How to Prevent Users from Circumventing Your Service

Many services are structured as follows: Person A pays Person B for a task or item, and the “finder” or “connector” service takes a cut. It’s a wonderful business model – someone else is doing all the “real” work, and you get a bit off the top.

The problem is that users are wise to this in recurring interactions. Once trust is established through a successful interaction, B will come back to A and cut a deal. Is the service taking a 10% cut when A pays B? Perfect. A will pay B 5% less, but will pay B directly. It’s a win-win for the users, and a big fat “lose” for the service.

Services must, therefore, offer an incentive to continue to use the service for repeated interactions. Consider the case of two very similar websites:

RentACoder

RentACoder, an outsourcing service, suffers from this problem and has been unsuccessful thus far at tackling it. For the first job between a provider and me, the provider has a strong incentive to work through RentACoder. The person doesn’t know me, and has no idea if I’ll pay them; RentACoder offers protection from that. However, once mutual trust has been established, they will, almost without fail, ask me to pay them directly.

Ironically, RentACoder’s attempts at attacking this problem probably worsen it. The service offers conflict resolution / protection — but only if you’ve been using their service for all communications. Their hope is, I believe, that you’ll be less likely to leave the service if you communicate via RentACoder.

However, conflict resolution – eg, will-they-pay-me-or-won’t-they – is primarily a benefit in the early stages of a resolution, not in longer term transactions. Additionally, this feature is only offered if all communication is through their platform. Users much prefer to use their existing mail and messaging tools, especially since RentACoder’s interface looks like craigslist got in a fight with linux – and lost. So, even if a user wanted conflict resolution, it likely wouldn’t be available to them.

And so, RentACoder loses the exact transactions it wants to maintain: the long-term ones.

oDesk

Surprisingly, oDesk does not suffer from this circumventing issue. In the 20 or so oDesk providers I’ve worked with over the last year, not one has asked me to pay them directly. Why? Because oDesk offers an incentive to both me and the provider to continue using them.

Employers prefer to pay through oDesk because they can track the worker’s hours. Even if one trusts a worker, concerns still arise when a task takes unusually long. oDesk providers install software which takes a random screenshot every couple of minutes. If an employer is unsure why a task took so long, the screenshots can relieve their concerns.

Employees prefer to work with oDesk because employers see long and continuous work assignments as implicit reference. Sure, employers could look at the worker’s reviews, but “grade inflation” renders reviews almost useless. However, 100+ hours of work for the same employer says something very strong about the candidate. By continuing to work through oDesk, employees boost their resume and their attractiveness to employers.

Thus, both employers and employees continue to work through oDesk, and oDesk reaps the benefits.

What This Means for Your Company

If you’re offering a service where people have an incentive to “cut you out,” think long and hard about how you can add value in repeated interactions. What are their problems? What can you solve?

In the case of outsourcing websites, employees face the problem of finding new jobs, and employers worry that employees are exaggerating time limits. oDesk has solved these pain points, and so we continue to work with them. RentACoder, however, is cut out of the picture.

Which service do you want to be?

PeopleOfWalmart launches with EmptySpaceAds!

If you haven’t checked out PeopleOfWalmart yet, you’re in for a treat. Pages of entertainment from America’s classiest individuals (yes, mother of mullet-baby, I’m speaking to you).

One of my favorite websites just got a little bit better: it just launched EmptySpaceAds! Move your mouse to the margins of the page and you’ll see the new ads come up.

EmptySpaceAds is the same start-up I was working for before I left to go back to school, so it’s really exciting for me to see this development.

Now, I know ads aren’t exactly exciting for most people – who likes ‘em? They replace regular content and get in your way as a result. That’s why EmptySpaceAds is so great – it’s in the margins, so it won’t replace any “real” content, and it doesn’t get in your way like many pop-up ads.

For publishers, it offers similar benefits. You can increase the number ads you show on a page (and therefore your revenue), or you can replace your ad units with EmptySpaceAds. Either way, you’ll see a boost in your revenue. And, best of all – you don’t have to sacrifice content that brings customers to your page.

Check them out at: PeopleOfWalmart.com and EmptySpaceAds.com.

Outsourcing Your Life in 8 Easy Steps

Think Less, Experiment More: 5 Lessons on Entrepreneurship

A guest blog post I wrote for Women Grow Business:

New! Affiliate Program for CareerCup

Good news bloggers and website owners!  CareerCup has just launched its new affiliate program.  CareerCup’s affiliate programs allows website owners to post a link / ad for CareerCup’s interview guide and, in return, collect some of the revenue from any sale.  Best of all, it’s super-easy to use!

In Defense of Outsourcing

As I’ve mentioned before, I’ve started outsourcing. A lot. Most of the outsourcing goes to an (awesome) assistant in the Philippines, who does everything from online research to document editing. She’s great, and she’s quite literally changed my approach to working.

Although most people are merely intrigued by my hiring a remote assistant, a surprising number tell me that it’s unethical, supplying one of these reasons:

Exploitation: “You’re only hiring someone from because they’re cheap. You’re not even paying them minimum wage!”

While it’s true that some people I hire are paid well below US minimum wage (you can find assistants for as little as $1.50 per hour, though mine are paid considerably more), it’s hardly exploiting them. I do believe that employees should be paid a livable wage, but that means a livable wage for their country, not for the US.

It’s surprising to me that so many people would complain about this, when we’re all perfectly accustomed to salary adjustments based on cost of living. For example, Microsoft pays California employees 15% more for the same work than they do the Seattle employees. Likewise, they no doubt pay their India employees considerably less. Exploitative? Of course not.

Now, I’m not an expert in economics, but I would guess that, far from being exploitative, outsourcing is quite good for the target areas. You’re providing the people with work. Doesn’t that boost their economy? Isn’t that good?

Protectionism: “What about the US? You should be hiring US workers!”

Most outsourcing-supporting respond with the following:
1) “By outsourcing to India / Philippines / another country, we can expand our company and eventually hire more Americans.” I don’t know in which cases this argument is true, but I can certainly say that it’s been true in my case. The outsourced workers I’ve hired have been the reason that I’ve been able to generate revenue for CareerCup. It simply would not have been possible without them. This revenue, in turn, enables me to hire Americans for things that do need to be done in the US.
2) “Welcome to a global world. If you don’t operate efficiently, your competitors – who may not be American – will simply out perform you.” This is possibly the most compelling argument. A business has an obligation to its shareholders to operate efficiently. If it doesn’t operate efficiently, another company will. And then, if that happens, how have we helped the US?

In addition to those two points, however, I’d like to make a third:
3) Why are Americans so important? Why is hiring an American inherently “better” (ethically speaking) than a hiring someone from India? Are we not all people? In fact, I could very well argue the opposite: supporting a person in a poorer country, whose children may struggle to eat or to get an education, is more ethical than hiring a comparatively wealthy American. (I’m not saying that that’s true; I’m merely arguing that the reverse isn’t necessarily true either.)

Suffice to say… I feel perfectly at easy with my decision to outsource. I’ve employed some extraordinarily talented people and rewarded them well for their work. I understand that there’s an awful lot I don’t understand about globalization, so perhaps someone will open my eyes to some horrible truths. Until that day, though, I will continue to use outsourced workers to build and expand new projects.

PictureMash: Smart Sorting for All Your Pics

While I can’t exactly call myself an avid photographer - as I have zero skill in this art form – I do have a lot of photo albums. I call it the “quantity over quality approach.” Unfortunately, when I want to look up, say, pictures from my Microsoft internship in 2003, it’s a mess. Picasa throws all your albums in one ginormous list, making it difficult to track down the right pictures. That’s why I created PictureMash.

PictureMash lets you do the following (or go see my account for an example):

• Group albums logically – and automatically – by time into “Smart Folders”
  For example, I created a “Smart Folder” called Microsoft Internship 2003 which contains all albums between May 2003 and August 2003. I don’t have to put the albums in there manually – I just give PictureMash the date range I want, and it does its thing. And, I can even group my smart folders, allowing me to tuck away all my college pictures into one master folder.
  
• Merge Picasa and Flickr albums
  If you’re like, well, many people, you may have used both Picasa and Flickr albums. PictureMash puts them all into one seamless list.
• Add tags and related links
  When I go to a party or event, I’m usually not the only one taking pictures. With PictureMash, I can add links to my friend’s pictures too, right next to my album. This way, when I’m looking up pictures from Seattle Anti-Freeze’s Roller Disco party, I remember to look at Ming Li’s pictures too.
• Create one feed for all your friends
  Another fun use case for PictureMash: I can create a “group” account and add my friends’ pictures to this account. When I move across the country next month, I’ll be able to reference this account to see what’s going on with my Seattle friends.

And remember: you don’t have to re-upload anything. All your pictures are still stored on Picasa or Flickr!

Go check out PictureMash and let me know what you think. It’s all free and super easy to use, so enjoy!

Company Loyalty = using Microsoft search to prep for a new job

Microsoft Loyalty Scorecard:
+ 1: Using Microsoft search at work.
- 1: Using Microsoft search to prepare for your upcoming interviews… at work.

Kumo is Microsoft’s new search engine that was released internally this month. No one seems to be talking about it much externally, and it doesn’t show up in Google Analytics under “Search Engines”. Kumo is, however, listed as a referring site for my site, CareerCup, which helps prepare for technical interviews. Almost all the Kumo users are, of course, from Redmond with a couple in Bellevue and Toyko.

Well, hey – while it’s not so nice to look for a new job while at work, at least you’re using Microsoft’s search engine to get there. Your boss must be thrilled.

But, if you’re still looking for a new job, I’ve got one for you.

Learning Spanish on the Kindle? Hmm…

I spent six weeks in Argentina learning Spanish, and I’d love to keep up my limited skills by reading in Spanish. But, the fact is, my vocabulary just isn’t good enough, and whipping out a dictionary at every other word is too cumbersome.

With a few relatively straight-forward changes, the Kindle 2 could really help out here. Amazon (or some clever hacker) could modify the existing dictionary to do translation. When you hover the cursor next to a Spanish word, an English translation of the word would pop up.

The technology behind this doesn’t seem so tricky. The Kindle 2 already has a dictionary that operates in much the same way: when I hover next to an (English) word, a definition pops up. Thus, Amazon would just need to swap out the English dictionary for an Spanish-English dictionary.

¿Qué piensas?

Amazon Kindle 2 Review (From a Kindle 1 Owner)

I said I wouldn’t buy a Kindle 2, as I already own a Kindle 1, and I made it a whole five days. As one friend said, I’d make an awful POW. Fair point. However (this is where I try to justify my choice), my Kindle is probably my most used device, so upgrading isn’t so silly.

I love my Kindle 1. I carry it with me in my purse at all times (ah, the benefits of being a woman). I read so much more since I got it. There were the obvious benefits of owning a Kindle (being able to carry multiple books at once), and then the less obvious benefits (being able to read one handed, easily purchasing books while on vacation, not having to buy books at airports).

I must admit though – in the first few hours owning the Kindle 2, it’s a serious step up.

Keyboard

The once horrible keyboard is now merely mediocre. The Kindle 1’s keys were quite stiff, whereas the Kindle 2’s keys have a similar resistance as a mac keyboard. The keys are still awkwardly far apart, unfortunately.

And, now that the screen is faster, the keyboard now feels much faster as well.

Cover

I’m not sure why Amazon didn’t put more thought into the Kindle 1 cover, but they seem to have corrected the cover for the Kindle 2. The previous bulky case has been replaced with a trim, firm cover. The Kindle 1 would often slip from it’s very lose case – the Kindle 2 locks in place almost like a seatbelt clasp. Snug and slim – perfect.

Underlining and Highlighting

What was once a cumbersome process of fiddling with slow menus is now an intuitive selection process. Want to add a highlight? Move the cursor. Click. Move. Click again. Want to add a note? Just start typing.

Fewer Accidental Clicks

The “Next Page” button has been re-oriented so that you’re less likely to accidentally hit it. Frankly, I didn’t really have this problem after the first few days of owning the Kindle 1. However, it was a little annoying that every time you showed someone else the Kindle 1 they would turn your page. This has been fixed. This bigger benefit, to me, is that I probably don’t need to put on the screen lock any more as things in my purse are less likely to turn the page.

Archived Items

The Archived Items (eg, old books stored on Amazon’s servers) are now much easier to retrieve. The previous “Content Manager”, which included all current and previous books, has been replaced with Archived Items – a simple listing of all your old books. By trimming it down to only what’s _not_ on your device, it’s much easier to find what you were looking for.

Look and Feel

The sharp edges (a significant issue when you’re reading for long periods of time) have been replaced by rounded edges. The cheap plastic feel that reminded me of the old NES or a children’s toy is now something that could have _almost_ been designed by Apple.

Overall, it’s not perfect, but it’s a big step up from what was already a great device.