Jersey’s fulfilment industry
Jersey and Guernsey occupy a unique constitutional position. Crown dependents of the UK, they are pretty much autonomous governments, who operate outside of the EU. Neither jurisdiction charges VAT.
In the old, pre-internet days, (15 years ago!), exports to the EU below the value of £18 were deemed VAT-exempt, because the cost of collection would be too high. This is an administrative relief known as Low Value Consignment Relief or LVCR. Jersey and Guernsey, always quick to exploit a loophole, rapidly grew a fulfilment industry capable of shipping millions of items a day to the UK, EU and the world.
All this has carried on without a major furore until Nick Goulding of the Forum of Private Business (FPB) started kicking up a fuss on behalf his members. In particular, he was incensed by UK ecommerce operators (namely Amazon and Tesco) moving part of their operations to Jersey.
Inevitably, the Labour Government made rumblings in its last budget stating that they were aware of the abuse of the Low Value Consignment Relief by companies who had set up in the Channel Islands and that they would introduce legislation to stop the avoidance of VAT if companies continued this behaviour. The 2006 budget also stated that £85 million per year was currently being lost in unpaid VAT as a result of this trade. This amount is expected to rise to £200m soon.
Which brings me to the point of today’s post. Yesterday’s report from Jersey scrutiny panel accuses Philip Ozouf (Economic Development Minister) of prematurely shutting down the fulfilment industry. Deputy Geoff Southern, with a characteristic disregard for the facts says that Ozouf ‘buckled under pressure’, and of having taken ‘a step too far’.
Southern’s grasp of the situtation is lamentable. Ozouf’s manoevuring appears to have appeased the British government, and has opened the way for Jersey businesses to benefit from this loophole. In fact, we have seen a commensurate increase in LCVR business since the Ozouf statement. Scrutiny is a good concept, as long as it is intelligent and constructive. This level of scrutiny is intellectually bankrupt and a waste of taxpayer’s money.
Swallow’s Blog
Swallow’s Blog is the new blog of Craig Swallow, Managing Director of Connexion2 . Craig’s blog will be used to communicate with his clients and prospects. Connexion2 are the makers in the Identicom, which is a unique lone worker protection device. The device looks like an ordinary identity badge, but conceals a sophisticated GSM phone. When a user is in trouble, they can activate a concealed button at the back of the device, and alert a control centre. The control centre triangulates the users location, and then directs an appropriate response.
7 Day Weekend
Quick book recommendation: 7 Day Weekend, by Ricardo Semler. When Ricardo Semler inherited the family business at 18 he spent the first day sacking the entire senior management team, and empowering workers to fire the middle tier of management. He is one of the most progressive, and radical business thinkers of our time. 7 Day Weekend outlines his basic business philosophies, which could be summarised as happy workers, are productive workers.
Semler makes the point that in the age of blackberries, webmail, and sms, we’re always engaging with business issues. But if we do our emails on Sunday night for a couple of hours, do we take a couple of hours off for a nice long lunch? Semler isn’t some pontificating academic, he’s tried his ideas out in Semco, which has turned from a small Brazillian family-run business into a sprawling multi-national.
Semler’s rules for Management Without Control
“Forget about the top line.
Never stop being a start-up.
Don’t be a nanny.
Let talent find its place.
Make decisions quickly and openly.
Partner promiscuously.”
Webreality blog revolution
Yesterday, Gilly Challinor, Webreality’s project manager, launched her new blog. As with all things Gilly, it’s impeccably researched and deftly written.
Gilly’s blog will soon be followed by a CSS blog by Liam Hennelly (probably the Island’s foremost expert on CSS, XHTML1.0 and DHTML), a design blog by Paul McGurk, and dev blogs by Tom Witherington and Mark Bisson.
Such prodigious output from the team begs the question why blog? For many blogging is cathartic (there are more bloggers than readers), but savvy-businesses are recognising that frank and open employee blogs give a direct access to the market, both prospects and new customers.
If our customers don’t like our R&D direction they can now steer that process directly. If customers don’t like our service, they can tell us (publicly!), and we can respond. In short, our belief is that if you’re good at what you do, you’ve got nothing to hide.
Another common concern with this approach is that you’re giving your competitors too much information. We don’t believe you can have too much competition, and if our competitors are getting their strategy from our company blogs, then I’m delighted. Business dinosaurs who spend all their time information hiding, won’t survive the meteor of Web 2.0.
Official Google Webmaster Central Blog: Learn more about Googlebot’s crawl of your site and more!
Official Google Webmaster Central Blog: Learn more about Googlebot’s crawl of your site and more!
Google has posted some improvements to its webmaster tools. Definitely worth having a look at is the ‘Crawl Rate control’ which determines how quickly the Googlebot consumes your site.
As the post above indicates, Google uses ’sophisticated algorithims that determing how much to crawl your site’. Sophisticated? How about, if you don’t change your content much, Google won’t crawl you much. And if you’re not changing your content much, you will drift down the rankings as your site can’t be very important right?
So, two good tips for today. Set the Crawl rate control to fast (we’ve got loads of bandwidth on the Webreality server farm, go for it!), but then make sure you’re content’s moving faster than a snail.
Webreality wins Best Use of New Media 2006
Friday night saw the annual Chartered Institute of Marketing ball, where the good and great gather to slap each other on the back. We submitted Elect Jersey for the best use of new media 2006, and much to our surprise walked off with a coveted plate. We were also shortlisted for best overall marketing achievement.
Unfortunately, I didn’t have the opportunity to thank my parents for conceiving, but here are the people I would like to thank:
Matthew Robins, Mourant, whose brainchild EJ was and who sacrificed hundreds of hours in generating top quality content for the site. It’s no exaggeration to say that he’s one of the Island’s best marketeers.
Rod Bryans, Hepburns Insurance, who was a great supporter of EJ and who has mentored me for six years; he really deserves an award.
Chris Lovasz, HSBC, formerly Webreality. Chris did sterling work putting together the technical infrastructure for EJ, and as always a commitment that went way beyond work. Thank you Chris.
Tom Witherington, Webreality. Tom is a coding genius, and he knows it. If you think the blogging engine was good on EJ, take a look at blogmybook.com.
I’d also like to congratulate Sam Watts and Nicola Mauger at Orchid (not sure why their website is still coming soon…) . They deserve the mantle of agency of the year, and we’re grateful to them for the work they’ve done for Webreality.
Publishing Industry on its last legs?
Adrienne Worthington, aka Francis O’Brien, approached Webreality recently to help promote her forthcoming novel, Sheer Bliss. The challenge for Adrienne, and all authors, is getting the message to her target market, in this case teenage girls. We felt that a conventional website would be to staid, and unlikely to engage with this market. Instead, we proposed that Adrienne penned a blog in character (her protagonist is a teenage girl called Bliss Drew, the daughter of a US filmstar). In addition, we’ve created a MySpace site, that will contain video diaries of Bliss, and access to Adrienne as an author.
The whole experience is extremely energising. Adrienne has real verve and a determination to engage with her audience. Crucially, I think it points to a sea change in the publishing industry. Traditionally, commercial realities have censored literature. Unless a book sells, it won’t get printed, but what sells is second-guessed by ultra-cautious, deluged, publishers. It’s surprising that there is still so many good things to read.
But blogging has given rise to a whole new generation of authors. This time, publishers don’t need to guess whether the blog-to-book authors will succeed - success has already been established in the blogosphere.
Blood, sweat and tea charts the life and times of Tom Reynolds, a London ambulance driver. It’s gritty, entertaining, and a straightforward lift of an existing blog (Random Acts of Reality). It’s a great book/blog, and it goes against every publisher’s instinct to hoard and protect content.
So, this has given rise to our next big idea. Today, we’ve started work on Blogmybook.com which is going to be a blog portal specifically for budding authors. We’re also building a rating system, so that when an author achieves critical success in the blogosphere, we can publish straightaway. I’m quite excited about this, and as people in the office will know, there has been a lot of arm-waving today.
Google buys YouTube
On Monday, Google bought YouTube for $1.65 billion . The deal confirms that web 2.0, many-to-many, community-driven sites have massive commercial appeal. As Google’s own profits indicate (roughly $400m per quarter - so, the YouTube buy is pretty big, even by Google standards), there’s a lot of money to be made from online advertising. High traffic sites, that provide some profiling on users, are effectively online gold mines. Deals like this will signal a landslide shift from offline to online marketing.
I guess Google know what they’re doing, but I think it may have been their first significant strategic mistake. Google has made its reputation on its neutrality as a content indexer (but see previous post on Googlebombing for example of Google bias). But now it’s bought a major content distributor, it’s in effect poacher turned gamekeeper, and you can’t be both.
Moreover, in terms of the YouTube acquisition, it’s difficult to see the case for the $1.65bn price tag. YouTube has been likened to Napster pre-litigation. And surely litigation will come, as the site carries masses of copyright infringing material.
Still, the investment does signal that the rate of change is accelerating, hang on to your seats!
Web 2.0 and e-commerce
Amazon.com, Play.com, CDwow.com will all go down in the ecommerce hall of fame as the trailblazers that got the whole thing moving. Traditionally, they’ve been painted as the new economy. They are agile, fluid, not strangled by a massive retail presence. The old economy, meanwhile, is still recoiling from a rapidly changing market, and spends millions on ecommerce sites that just repeat the same old offline mistakes.
But I’m not sure that these trailblazers will win the day. In fact, in terms of web 2.0, they’re decidedly old economy. Amazon et al are really just old economy businesses using the internet as another channel to market.
Because it is a relatively new channel to market, internet marketeers have tended to recommend conventionality in design, so that new customers are not confused in the buying process. This has led to a whole raft of ecommerce sites that imitate Amazon’s processes, even down to the tabs at the top of their sites.
Here are 5 more creative approaches that I read about in SEOmoz daily blog.
The AJAX Overlay
Gap.com’s overlay of a product detail
Generally, I’m not a great fan of whizzy pages that break the browser’s back button and useability guidelines, but showing an overlay of product detail gives Gap.com users the chance to browse more deeply witout committing to a full page change. I guess this would be more akin to a conventional retail experience?
The Colour Selector
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Etsy.com’s Color Picker
More creative methods for browsing stock should be reviewed by all ecommerce designers. We spend a lot of time with customers agonising over the customer process flow. Often, we have to make wholesale changes to this process, in the face of actual trading data.
The Customizable Product
Puma.com’s Mongolian Shoe BBQ
This is really unusable, but such a smart concept that it’s worth a look. I like the concept because it moves well beyond conventional retail, and allows the customer to interact with the manufacturer and the design process in quite a unique way.
The Product Blog
Flypaper - Bluefly’s Product Blog
This is another win for blogging. An ecommerce site, where BlueFly blogs its own products. This is taking the customer review concept to its logical concept, and encourages consumers to buy into a lifestyle, that they actively engage in and relate to.
The Embedded Testimonial
PixelGirlShop’s In-Depth Testimonials
Again this is a customer review development; but the testimonials are real people with real passion for the products.
All food for thought; for my money I’d expect product blogging to be a de facto standard within twelve months.
Googlebombing and anchor text
Anchor text is important. Anchor text is the visible content of a hyperlink. So hyperlinks in your sites that read click here are completely useless.
I’ve spoken in previous posts about evaluating your effectiveness in the search engines by looking at traffic rankings (www.alexa.com) and using the link: command to see how many sites are linking to yours.
The Google allinanchor command finds pages that have the keywords somewhere in the links to the page.
This feature of Google led to a famous Googlebombing episode last year, when a group of pranksters generated enough hyperlinks on the phrase miserable failure, to ensure that a search on Google for miserable failure or failure brings up George Bush’s bio on the Whitehouse website.
Even more fascinating is the Google Adword that displays at the top of that search:
The Adword links to the official GoogleBlog where Marissa Mayer refuses to defuse the bomb, claiming that such pranks “don’t affect the overall quality of our search service”. So, Google won’t intervene for George Bush, but they will for the Chinese government. Live.com have defused the bomb though - I don’t consider that to be a failure.