Pinterest Business Model Canvas

My research found that Pinterest primarily supports itself through fundraising by seeking out investors. Some key investors are Valiant Capital, Rakuten, Andeerson Horowitz, Bessemer Venture Partners, and FirstMark Capital. The majority of Pinterest's (about 83%) 40M users are women, I estimate of the remaining 17%, 10% are men and 7% are teens.

Pinterest has significant costs in web development and storage of $2M per month, or $24M per year. Pinterest has about 300 employees, and assuming the average employee, plus any health insurance and other benefits makes about $100,000 per year, the total staffing costs would be $30M per year. I also assumed that Pinterest may pay about $1M per year in security costs.

Pinterest has begun selling advertisements on its website to major corporations such as General Mills, Kraft, Lululemon, and Gap. These advertisements can generate about $2M per six months, so Pinterest could make $16M in Advertising Revenue from those four partners in a 12 month period.

Since Pinterest has the ability to bring in $16M per year in advertising revenue from the above mentioned firms, it could add to that revenue stream by securing additional advertising partners. As things stand, it will not be possible for Pinterest to make money; however, there is potential to make money with additional advertising partners.

In its current state, I estimate that Pinterest is losing about $39M per year, which is less than the approximately $56M per year it was losing before it began brining in advertising revenues.

Strategies for generating additional revenues:
Similar to Facebook and Twitter, Pinterest could develop a "sponsored" pin for which a user could pay a fee to have its pin featured.

Pinterest could add in required viewing videos such as YouTube in order to view certain pages which could also generate advertising revenue.

History of the Internet

I thought it was very interesting to watch the YouTube clip on the history of the internet. It was a detailed, technical look at arguably the most fascinating invention in the history of the world. The points discussed in that video are not things that I ever think about each day when I open my laptop, iPad, or iPhone to surf to the web, send a tweet, check FootballScoop.com, send emails...or write blog posts.

Consumers Run the Show

Page 11 of this week's main reading had a line that really jumped off the page at me: "Consumers run the show". I think that it is becoming more and more important for marketers to realize this in today's economic climate. When I was working at UConn I took the approach of trying to provide social media content, handwritten correspondence, and general correspondence to our prospective student-athletes that they wanted to see. The target audience was my consumer base and I couldn't simply take the approach of creating material that I liked to view or that the coaches thought we should create (although at times those ideas did fit what we needed to do).

I also was struck by the mention of cookies. In the past several months I have made numerous trips to Indianapolis (for the AFCA convention, KD Connect Week, a job interview at Purdue, etc), so I often get United Airlines banners on web pages advertising flights from BDL (Hartford, CT) to IND (Indianapolis, IN).

Infographics

Over the last 12 months or so I have really come to enjoy infographics. As I have stated in previous blog posts, Infographics are becoming more popular, and widely effective in the world of football recruiting.

I really liked the infographic prepared on "The Retailers Guide to Big Data" from the Shopping and Social Media. It really details the importance of the shift from digital consumption on computers to digital consumption on smart phones and wireless devices. This is a key point that executives and strategy makers will have to keep in the forefront in the coming months and years.

For a while there was a trend in football recruiting to create expensive "micro" websites that were a football-only focus. These sites could be upwards of $80,000 to create. An example is http://lesmiles.net/#/main. This is a site that LSU contracted Overtime Software to create. It relies heavily on flash media, which led to LSU having to create a mobile app, thus costing more money. From my experience I have also found these sites are tremendously difficult to maintain if a staff does not have one full time staffer solely dedicated to the site.

What I have found (without hard data, more word of mouth-type conversations) is that the traffic to these sites consists of more fans, the media, and others that are not part of the target audience (football recruits). So schools were dishing out thousands upon thousands of dollars without asking what the return on their investment was (maybe one of these schools should hire me to manage their recruiting efforts).

Recently a firm called JumpForward released a new concept for a recruiting based microsite called a "Social Media Hub", which had a desktop platform, but is geared toward the mobile consumer. Their first client to implement such as site was Northwestern: http://www.thewildcatway.com. JumpForward was able to develop a site that gave a one stop shop for all of Northwestern's social media accounts. Aside from the practicality of being very mobile friendly, it is also about 12% of the cost of those other "flashy" flash based sites.

Now, back to the Infographic in the article - This piece contains so much information and it is presented very succinctly for the reader. I think this is something that I could take and re-work (with different data) to be geared towards a football program.

Two interesting articles on the power (or lack there of) Facebook

I found two articles this week about Facebook's power (or lack there of). The first was about internet marketing. It contained some data collected from businesses on their use of social media.

Marketers use of Facebook

Nearly 97% of marketers use Facebook for B2C marketing when 57% don't believe it even works. That seems like a waste of resources! The article also says that only 1% of marketers are using Snap Chat. One thing that I found very fascinating is that just last week Walt Disney World unveiled their plan to begin using Snap Chat in their social media marketing.

Snap Chat for Disney World

From my experience, I find that the younger generation (high school and college age) are turning much more towards Twitter and Snap Chat. CNBC had an article that contained little to no scientific data about UCLA students' views on social media.

UCLA Students & Snap Chat

They certainly seem to be turning to the route of Snap Chat.

Business Model Canvas Assignment 1

I chose to use my former employer, the University of Connecticut Football Program for my first Business Model Canvas Assignment. I was able to gain a clear understanding of the operational end of the football program over the course of the six years I worked at UConn.

To begin, I provided the following as the value proposition for what UConn Football is providing to their customer base: "Provide exciting football games against high quality opponents in a state of the art stadium built in 2003." Rentschler Field is a tremendous venue to watch a college football game. It is one of the newer college football stadiums in the country and includes great amenities such as a high definition video board, beer vendors, and concessions areas.

Football is considered to be a "Revenue Generating Sport", which means that it should be at a minimum revenue neutral, or turn a "profit". If a profit is turned it is then redistributed to other sports that may not generate enough revenue to cover their expenses. Customer relationships includes tickets to games being sold over the internet on UConnHuskies.com, over the phone, and in person at the on-campus ticket office and the stadium box office on the day of the game. Key activities are the games, as they are the primary source of ticket revenue, but making post season bowl games, the annual signing day event, and the spring game are great ways to generate revenue by enticing fans and alumni to make private donations.

Next, here is an analysis of the major revenue streams for the UConn Football program. These would most likely be fairly similar to most major college football programs across the country. The first is the American Athletic Conference Television Contract. The revenue share for teams in the AAC is about $3.5 million per year per school. The University of Connecticut Division of Athletics also has a contract with IMG College Sports that is worth about $10 million per year. For purposes of this assignment I assumed that Football accounted for 25%, Men's Basketball accounted for 25%, Women's Basketball Accounted for 25%, and all olympic sports bundled together to capture the remaining 25% of the $10 million per year. Therefore, I input $2.5 million in revenue from the IMG corporate partnership. The University of Connecticut Division of Athletics also has a corporate partnership with NIKE that is worth approximately $4.5 million per year. Once again, I used the same 25%/25%/25%/25% split amongst the four segments, which leaves the Football Program with approximately $1.125 million in revenue from the NIKE contract.

I also evaluated the revenue gained through private donations. In 2012, the University of Connecticut raised $21.8 million in private donations for athletics (Per UConn Fact Sheet). I once again used the 25%/25%/25%/25% split amongst the four segments that I used for the corporate partnership analysis, which led to me inputting $5.45 million in private donations being allocated to football.

For the purpose of this assignment I listed the television contract, the IMG Corporate partnership, and the NIKE corporate partnership as "Other" in the customer segment section. Since these are guaranteed revenue sources I input the customer segment size as "1" and the percent of market share as 100%.

I also evaluated ticket sales as part of the revenue stream. I looked at three potential segments of customers Alumni, CT Residents, and Students. Student season tickets sold out each of the years that I worked at UConn. The student body is 30,256 (Per UConn Fact Sheet) and the student section seating is approximately 5,000, which means about 16.8% of students buy the season ticket packages. The package includes 7 home games at $8 per ticket. Of the 217,000 (per 2012 UConn Fact Sheet) living alumni, I estimated that about 5% or 10,850 would purchase tickets. The average ticket price is $30 and their are 7 home games in a season. I also estimated that about one half of one percent of CT residents, or 17,950 would also purchase tickets. In total, that is approximately 33,800 tickets per game. The stadium seats about 38,500. For the purposes of this assignment I estimated that complimentary tickets for players, staff, the visiting team, give-a-ways, and the band accounted for the 5,000 other tickets.

Next, I evaluated the expenses for the football program. Our annual operating budget was approximately $4 million. This includes team travel, staff salaries, scholarships, equipment, and other operational costs. The annual recruiting budget was approximately $480,000. This includes coaches travel, official and unofficial visit costs, recruiting subscriptions, and recruiting software. I also estimated that the per game cost of the stadium lease agreement was approximately $2 million per game. This cost was part of a state contract that I did not have access to, but the general estimate of $2 million had been discussed in meetings that I had attended. Over the course of 7 home games that would equal $14 million.

The total revenues equalled $18,907,648 and the expenses equalled $18,480,000 for a "profit" of $427,648. Because of the methods of tracking football only expenses that are only part of the football budget and division wide expenses, I did have to include some estimates in this analysis. According to the tool based on the figures I input, UConn Football is an effective Revenue Generating Sport that could assist the Division of Athletics in funding other varsity sports on campus.

UConn Fact Sheet

Capital, Competition, Creativity

As I watched this week's lecture the 3 Cs of Capital, Competition and Creativity really stuck out to me. I do agree that this is the future of the internet and it is the future of many different businesses. I have, without a doubt, witnessed this concept in college football recruiting in the past 12-18 months.

The video also mentions Vine, which is an interesting concept for social media. I prefer the 15 second Instagram videos as opposed to the 6 second Vine videos. I did agree with the mention that Instagram is becoming the younger generation's Facebook; however, I feel that SnapChat may even be taking over the popularity of Instagram. As I stated in an earlier week's blog post, SnapChat becomes a permissible form of communication for college coaches and prospective student-athletes on August 1, 2014.

It will be interesting to see what sort of traction Mark Cuban can gain with his new social media application called CyberDust, which like SnapChat contains texts and photos that disappear and are untraceable once gone. Mark Cuban Cyber Dust.

Earlier this week I read a job posting put out by the University of Michigan Football program. Michigan Recruiting Assistant Job Posting. I actually think that Michigan will have a larger reach to prospects if the videos are being created for Instagram. I believe that it is a larger platform amongst the target audience compared to Vine.

Community Relations 2.0

As I read through the Community Relations 2.0 PDF I couldn't help but think about the vast increase in graphically appealing "edits" or PhotoShop pieces that are posted almost daily on social media platforms by college football coaches (some examples to come).

This line of the article really jumped out at me: "Social Media platforms enhance the power of online communities in four ways: They promote deep relationships, allow fast organization, improve the synthesis and creation of knowledge, and permit better filtering of information."

In the Fall of 2013 I went on a mission to find a member of the UConn student body who possessed the technical skills in PhotoShop and InDesign to create the type of content that I knew we needed to be supplying to our target audience (students, alums, fans, donors, prospective student-athletes, etc). I found myself a gem, and ironically she grew up just about a mile from where I grew up. I was lucky that I found someone who I could really vet through many contacts I had at UConn and from my hometown. She turned out to be fantastic, and she keeps getting better with every piece that she creates.

Here are some examples of things that schools are putting out:

You can see that these really captivate the audience and they really do the four things mentioned in the above quote. 

Here are a few examples of what my student worker (Steph Orts) prepared while she was working for me. (If anyone has a need for similar things to be created I would HIGHLY recommend her).

These are a great way for people to get their messages across to key constituency groups via Twitter and Facebook. They are graphically appealing and they provide meaningful information. It is far better than simply seeing 140 characters on a screen. 

Competition Between Bloggers

As I was reading the chapter on social media I came across this line:

"The dynamics of social media today are rooted in the competition between bloggers to greater influence for their personal points of view, attached to their names and their identities."

This made me think of a well known story within the collegiate football coaching circles of two brothers who started a website in 1999 called FootballScoop.com. Football Scoop is essentially a semi-news driven and semi-gossip driven site that tracks coaching changes as coaches are hired, fired, promoted, retire, etc.

Here is an article that details the split between the two brothers, Scott and Pete Roussell which led to the creator of Football Scoop's first ever competitor CoachingSearch.com. CoachingSearch.

Article on Brotherly Feud

These two men who really revolutionized the tracking of coaching searches and football personnel moves have both created a tremendous brand together, and since their separation they've created two very powerful individual brands. Both have a huge following on Twitter where they have several thousand followers. Football Scoop Twitter has over 57,000 followers while CoachingSearch Twitter has over 40,000 followers. What were once sites followed by coaches and athletic administrators are now followed by fans, the media, and student-athletes.

I have always found this story interesting and reading the social media chapter, especially the quote I pulled earlier really puts this into a different perspective.

Week 2 Blog Post

Well, I'm back. Heading into my 3rd blog post and I'm starting to enjoy it. As I've said in my previous posts I never thought I would be doing this.

I found this week's material interesting. Evaluating this week's material made me think of the following: One buzz phrase that football coaches like to use is that we are in the "information gathering" business and not the information giving business. Coaches love to discover and learn new information in recruiting, in offensive/defensive schemes, in personnel matters, etc but they do not like to let information about their program out.

Information Liquidity - I liked the idea of the "One to Many" concept. It is something that most people deal with every day and never think of it. On any given day I get several emails from different sites from Marriott to CVS and from Infiniti Service to Brooks Brothers. I must say the vast majority of these emails I delete without even opening them, but occasionally I do see a promotion that I open up and click on. I would also think that tweets sometimes could be considered in this model as well. News agencies put out a tweet that may contain an article link that then gets retweeted and passed around the internet. I did find the information about ubiquitous activity very interesting. The advent and evolution of mobile technology in the last 4-5 years has been tremendous. From my own experiences, social media has drastically changed the realm of football recruiting. On Aug 1, 2014 SnapChat becomes a legal method of communication in recruiting. This will allow for a tremendous flow of communication to prospective student athletes on a medium that they use quite frequently and it is incredibly inexpensive for both coaches and the prospects.

Making the Transition to the Social Web - The SnapChat and other methods of social media also are highlighted in the reading about transitioning to the social web. I gave a presentation (at the time I thought it was a job interview, but it was simply a fact finding mission by a university's football program) in which I covered the importance of social media in the recruiting process. I was surprised that a few of the coaches told me that some of my thoughts and ideas were the first they had heard on the topic outside of some basic social media functions.

Digital Marketing & The Vatican

After reading through this week's topic on how marketing strategies may have changed because of the internet, a story I read last fall came to mind.

Was Jesus the Original Tweeter? - Huffington Post

Was Jesus the Original Tweeter? - Washington Times

Now, when you take a step back from whatever your personal beliefs are, it is pretty amazing that the Vatican is connecting the Catholic Church, that is over 2000 years old to Twitter. I think this shows just how powerful the internet and digital marketing is in today's society.

First Ever Blog Post

So I am writing a blog post...for an MBA class. I have to say that I never really thought I would ever be blogging, but here I am.

This is not the first time I have seen or heard the Today Show clip about the @ symbol and the internet, and it was just as entertaining this time as it was the first.

Reading through and viewing the material this week has really allowed me to reflect on the changes to the world of college football recruiting (my experience & expertise as a professional) over the last several years. When I first started out in the field we would mail VHS tapes to HS coaches who would then copy footage for us and send it back in a return mailer that we provided. Shortly after, we shifted to sending DVDs using a similar method. The past 2-3 years has seen a completely drastic shift towards in the internet for our football recruiting film. At first coaches were posting videos to YouTube, but within the past 18-24 months HUDL has become the hotspot for finding these videos.

Here is a link to HUDL's website: HUDL and here is a link to a sample HUDL film of a PSA (prospective student-athlete) whom someone like me would be recruiting: Zach Allen New Canaan HS HUDL.

Twitter and Facebook have also revolutionized football recruiting, especially in our ability to communicate with prospects. It is not uncommon to have DM conversations with prospects, as it is a permissible method of communication. I never really thought I would ever have my twitter handle on my business card, but in today's technological age, it is essential for me to have @DWilcz on my business card.

With all of that being said, I think I fall on the side of the internet making us smarter. Yes the internet in cluttered with quite a bit of nonsense, but it also has endless tools that could make us smarter and more efficient.