Product Development and Internet Marketing

Congratulations to Josh on the del.ico.us acquisition. Yahoo will make a great partner for the bookmarking service.

Now a little part of me is cringing as I write this. Having founded a bookmarking company in 1999 with pretty much the exact same vision as the new crop of services, I’ve got to feel, well, a little stupid. (or angry, or depressed, or whatever). Maybe writing about it will make me feel better and maybe even help me make a point or two about product development.

When we founded Blink.com (no link love, it’s a crappy search site now) the founders and I imagined a self-reinforcing product cycle:

1. Consumers needed portable bookmarks so they wouldn’t lose them, would be able to access them from any computer, and could share them with friends or coworkers;

2. As part of the process of bookmarking sites and organizing them into "folders" users would be indicating a measure of quality and connectedness among the URLs;

3. Profit!

OK, step 3 was a little more complicated. But the essence was that we would use the personal-backup product attributes to create a public search engine and "discovery engine" (I believe the marketing folks wanted to use that phrase!) based on user bookmarks.

This really shouldn’t sound too different from what del.ico.us was able to do, and we had something like $13 million to play with to make it happen. Not to mention that there were others with the same idea. Remember Backflip? So (besides the money), why did we fail and del.ico.us and the other Web 2.0 companies succeed?

I don’t think it was that we were "too early" or that we got killed when the bubble burst. I believe it all came down to product design, and to some very slight differences in approach.

To start, we launched Blink with a bevy of marketing dollars and a message very much focused on the individual storage benefits. We were very successful at attracting users (at its height Blink has 1.5 million members, del.ico.us currently has 300,000) and getting them to import their bookmarks into our system.

Mistake: Defaults Matter

Members were given the ability to make their folders "public", which would then allow those folders to be seen on a member page (here’s mine). Folders were private by default, so users had to choose to make folders public one at a time. This severely limited the proportion of our bookmarks that were made public. In retrospect I think we didn’t fully buy in to our vision of a shared bookmark database, and as a result we designed the product with an over-emphasis on the private bookmarking aspect, instead of the public. We were also sure that users would have vast troves of porn bookmarks.

Mistake: Folders Suck

Our first iteration on using bookmarks to create a shared information library was an extension of the "public folder" concept. We believed that users would not only make their folders public, but also would categorize those folders into a directory structure. We called this the "Public Library" and created a Yahoo-like node structure on which users could post. This could have made sense since categorizing folders would be less work than categorizing individual bookmarks – after all, the folders were already "categories" of a sort.

There were several severe problems with this folder-based approach. First, people are very bad and inconsistent at organizing things. One day etrade.com will go into the "finance" folder and another day it will go into the "favorite links" folder. We were taking this fundamental flaw and squaring it – asking users to use graph their existing categorization onto a second arbitrary structure within the public library. Does my "finance" folder go into the "Business" directory or the "Personal" directory?

Then there was the issue of how deep to go when categorizing folders. If I’ve got a folder of "online brokerages" do I put it in the directory at the level of "Finance" since my folder is in a sense a sub-category of finance, or do I put it within the pre-existing "Finance -> Brokerage" directory? Users were confused, and with good reason.

Mistake: Make it Instantly Useful

Even with the severe ontological problems presented by our flawed public folder concept, we still had thousands of new folder postings per week. Users liked the concept of sharing bookmarks and were anxious to give it a try. But how useful was all the data being posted?

Once again, the folder concept doomed us. We only displayed what was posted on the site, which were folders. So if you were to search or navigate to the "Finance" section of our directory you would see…folders…hundreds of them. All of which had been given the helpful name "Finance" by their owners. Or maybe the more helpful "Financial sites" or "Finance bookmarks" or "Finance and banking". You get the point.

Why didn’t we just list out the top 10 bookmarks within each category? Well by building a folder based system we had made the job of calculating the union of all this data an order of magnitude more complex. The query to find the top sites that existed in hundreds of folders would have brought down our (poorly designed) database in a heartbeat. Eventually we did build something like this, but by that time it was too late.

Mistake: Don’t Let Technology Decide

We understood that actively searching for new bookmarks would be a fairly rare activity among our users. We needed to build a way to let them discover new sites relating to their own interests in a more passive way.

The engineering team went to work, building a complex algorithm for evaluating the groupings of sites within folders (damn folders!) and finding other sites that had been grouped similarly. It was pretty sophisticated stuff. Sophisticated enough that it couldn’t run in real-time and often had a several day processing backlog to overcome.

We added a "find similar" button to the Blink interface, and the results were often quite good. The problem was that we were once again asking the user to go out and do things. The vision was that the similar sites would just be there, the same way Amazon presents you with the related products. But the servers couldn’t handle it. They could barely handle it when the users actually clicked to see results, let alone on every pageview.

I suggested a compromise. Instead of the algorithm, how about just using the text of the folder name as the key. Show the top 10 sites in all folders with the same name, across all users. I was basically suggesting a rudimentary tagging system, using folder names as tags. I was voted down – too simplistic, too hacky. And anyway we had this sophisticated algorithm, which might work one day …


The Bottom Line: Getting It Right

This post wasn’t meant as a defense of Blink or my own decisions while I was there. My intent was to show that product design matters. We had more money, more users, a five year head start, and some really, really smart people working on bookmarking in 1999. The bottom line is that we simply didn’t get it right. Some simple innovations like using tags instead of folders, making public the default, building better discovery features, etc made the difference between being an also-ran and a hot acquisition target.

December 10, 2005 03:59 PM
Comments

Great post, Ari. This has case study written all over it. Now let's go grab a stiff blink. I mean, drink.

Posted by: Anittah on December 10, 2005 05:06 PM

Great post! It's amazing. I'm in the middle of something like this. At FotoFlix we have our own "folders" and they're called labels. We realized their downfall and are releasing a fix by converting them to tags. But everything you mentioned rings true...I feel like we're on the brink of being a del.icio.us or a blink.com.

I hope del.icio.us :)

Thanks for the honesty in this post.

Posted by: Jaisen Mathai on December 13, 2005 04:50 PM

I was within the first dozen people to join Blink; if I recall correctly, I was the first programmer hired outside of the founders. I have to admit that I, too, look at sites like del.ico.us and think about what went on. (Ok, I kick myself.)

Ari makes a lot of good points here, and I generally agree with them. Let me throw in a few of my thoughts.

First, coming from a programming point of view, we didn't have any good developers--and I include myself in this. We had a bunch of smart people, some very smart, and some good programmers, but we did a darn poor job of developing the product. Had we had someone who knew and had experience with, say, Extreme Programming, we could have done much, much better. (And I did, with a much less experienced development team, later on in my career.)

This was definitely a problem on the technical side; looking back I see evidence that our marketing departement, or Ari, at least, had the intelligence, flexibility and open-mindedness to do their part of the product-building process well, given the right structure in which to develop it.

Another thing that strikes me is that the company just got too big. Take a half-dozen developers, add a half-dozen marketers, throw in a few support staff and executives, and before you know it you've got twenty people in your company. That made it less focused and less entreprenural.

And as well, that increased the burn rate, which caused us to go searching for more money, which in turn caused us to do nasty things from the customers' point of view. At one point you'd see something like 30-40 ads and offers during the registration process alone. Not only does that turn off users, but we spent time and money developing the software and marketing systems to show and track those ads and offers. Ouch!

Well, all of this is much easier to see from this viewpoint than it was at the time--for anyone, not just us. And anyway, one learns a lot from watching things go wrong.

Posted by: Curt Sampson on December 13, 2005 10:58 PM

All this is exactly why product development should be started from a smaller scale. Get user feedback, play with your product yourself etc. Fix the things that make you mad, add the things that you'd like to have: 1) define X 2) play with X 3) measure X 4) alter/remove/enhance X.. goto 1. loop forever.

just my $0.02

Posted by: a on December 14, 2005 09:51 AM

Thank you, Ari, your input is invaluable. I am working on designing similar concepts, and you saved me years of work, literally. Good luck in your new endevours.

Posted by: Mark Kerzner on December 14, 2005 12:36 PM

Thanks for the analysis Ari. Very clear.

I have to tell a story. Right after the Yahoo! IPO I saw some pundit that said "the true genius in Yahoo! was in the brand". He really said that. Not being familiar with Internet history this person did not know that Yahoo was an acronym for Yet Another Hierarchically Organized Oracle. It was "yet another" because it was basically taking Yanoff's list from Gopher days and putting it on the web. (and if you think of it Blink was doing the same thing with bookmarks!)

Thinking of that I tracked down Yanoff, who was acting as a sys-admin for a law firm in Milwaukee at the time. I asked him if he ever kicked himself for missing out on the billions Jerry Yang made. He said: "yeah, about twice a day".

Hope this helps!

Posted by: Stiennon on December 14, 2005 03:51 PM

Sorry, the real reason is you were too early. Back in 1999, internet users were concerned with privacy. The n-sync/spears/pokemon/potter-generation has come of age online and readily adopts privacy-free collaboration because they've learned that everyone thinks alike so there's nothing to hide.

Posted by: Ted on December 14, 2005 07:20 PM

The Devil's in the Details

When social bookmarking really works, it's because it's because it is equal parts "social" and "bookmarking". Blink ended up being too much of the latter and not enough of the former. Ditto for Backflip. A big thank you to Ari for these insights.

Posted by: Paul Needham on December 15, 2005 03:25 AM

Great article...it stands apart in a world where everybody is bragging about what they did right...it has enlightened me in more ways than I could ever imagine, so thanks for sharing your experiences....wish you all the best in your future........

Posted by: rahul on December 15, 2005 05:03 AM

Very insightful post Ari. Often the differences between success and failure can get lost in a blink of the eye. It's all focused in retro, but hard to see during.

Posted by: Andre Durand on December 15, 2005 01:26 PM

Ari,
I still think timing was a factor. As Ted (above) suggests, privacy was a big issue back in the day...

Google helped change things dramatically. First it taught users to stop worrying as much about privacy when it came to legit/trusted companies.

Second, it gave the web a true revenue model and future cash flow that Google, Yahoo, and Microsoft are fighting to protect/take.

Yahoo is placing a big bet on social search so right time/right place played out well for Josh. As a standalone product, del.icio.us may not be worth much-- small userbase, no rev model, low barrier tech.

But if Yahoo is trying to protect its future cash flow of paid search money, and del.icio.us has social component with a lot of hype, its a risk that Yahoo will take right now.

Posted by: J Ryu on December 15, 2005 10:40 PM

Well done, Ari Paparo. You definitely realize that you can do well in the future.

To-do's & Not-to-do's for you next venture -- in summary:

1. Avoid categorization where possible :) (To-do)
2. Do not be over optimistic (Not-to-do)
3. Take calculated risks (To-do)
4. Do not overspend (To-do)
5. Listen to your users/Seek opinion & feedback/Be proactive (To-do)
6. Perform usablity studies (To-do)
7. Research your market and nail down the requirements (To-do)
8. Do not over-do (To-do)
9. More talk(marketing) & less walk(development) (Not-to-do)
10. Keep it(a product/service) simple and yet configurable (To-do)
11. Don't give up on your dreams (To-do)
12. Learn from mistakes (To-do)
13. Ignore profitablity plan/exit criteria (Not-to-do)
14. Bootstrap if possible (to-do)
15. Develop a brand (to-do)

Ah..that was simple rather than trying to categorize things(point#1) into:
-Things you've done well in the past
-Things you could have avoided and should avoid in future
-Things you could have done better
..etc..etc..

--An avid Internet browser

Posted by: InternetBrowser.org on December 16, 2005 07:23 PM

I hope you're not still feeling weird about posting this; it's one of the most fascinating Dot-Com-Era analyses I've read in a long time, and I'm really glad to have gotten the chance to see it. You're one of the only people from that period I've come across willing to make such objective statements about where things went wrong, which is just so refreshing to see; plus it proves that you really did care about Blink, that you really did put a lot of thought into it, and were not one of those typical get-rich-quick Dot Com people who are, whatever, selling ionizers at the Sharper Image at the Sunnyvale Mall now. For what it's worth, I was an early customer of Blink myself, and loved it for all the reasons you just mentioned, and agree with you that del.icio.us is even greater for all the reasons you mentioned. I hope you'll look at it more like that del.icio.us needed your early inspiration to even exist, rather than the idea that you 'failed' and del.icio.us succeeded.

Posted by: Jason Pettus on December 17, 2005 05:39 PM

Thanks for posting that Ari. That is such a difficult piece of personal thought to make public - it reflects well on you for having done so.

And great to see it being of such assistance to people.

keith

Posted by: keith bohanna on December 20, 2005 12:06 PM

Does anyone know how much Yahoo! paid for del.ico.us?

Posted by: Jason McMinn on December 20, 2005 03:32 PM

What an insightful post. I especially like the notion of "don't let technology decide." I agree with the triumph of simple, sound solutions. Thanks for the lesson.

Posted by: paul on December 20, 2005 09:30 PM

I never used blink but from what I read here and having taken a quick peek at blinkpro it seems by far a superior product than delicious. I can't imagine using only tags for my more than 2000 deeply folder-nested bookmarks. And that algorithm you describe sounds very interesting. Like someone said above, delicious was just there at the right time. And there's the hype of course. That kind of spectacularly irrational hype built around free or "don't be evil" products (gosh, 429.74 a share today, what an absurdity), no matter how feature deprived or visually unattractive the service is...

Posted by: Gantty on December 20, 2005 11:02 PM

I'm sorry for the four trackbacks, I had an error in my script, it shouldn't happen again thought. Good article btw ;)

Posted by: anty on December 21, 2005 05:14 AM

Really a great article.

Also a great reminder that relying on an online service can be dubious; when the online provider goes out of business, poof goes your data.

Posted by: Darcy McGee on December 21, 2005 09:12 AM

Some very good lessons and a good read. Thanks for sharing!

Posted by: shoepal on December 21, 2005 12:28 PM

If you had larger numbers of users back in 1999 (!) the errors you made could not have been so decisive. I agree that while with hind-sight you may be right about the matters of improvement, I don't think they played the key-role in success/failure. There's also a lot of things wrong with delicious, yet they do enough things right, that users like them, and that they are continously being talked about. I am trying to avoid the term "echo-chamber", but you probably know where I am going with this.

Had del.icio.us existed in 1999 I guarantuee you (yeah right), they would not have been bough by yahoo back then. They would not have reached the same publicity and same amount of positive reactions they are today. In fact I think it's very likely it would have been "just another blink".

Posted by: Spence on December 21, 2005 12:52 PM

Ari- wonderful and educational and brave post here. Thank you very much for being open and informative so that others can learn from your experiences.

Posted by: Gen Kanai on December 21, 2005 09:46 PM

Umm... as a paying member of BlinkPro, I kind of wonder about all of this. Yes, Del.ico.us got bought... but the need it meets is COMPLETELY different from what social bookmark services do. I have written extensively about how tagging is defective for research at my blog (http://www.nettakeaway.com/tp/), and this is repudiated every time you try to use a public bookmark site for answers to any question requiring more than one word.

Blinkpro and others are phenomenal tools for organizing things you want to go back to. Del.ico.us are for sharing things you think are interesting... and don't care if you find again. Social tagging is a stream/discovery process, not a retrieval. Its oriented towards the now and the pop, not history and the subtleties of investigation.

Yahoo is a media site, and it needs new content to keep things fresh. Tag-oriented social sites are fantastic for that; you can get new or most popular things every second. But Yahoo sure isn't throwing away the search engine, because users need more than the latest site tagged "Cool" or "web2.0" when they are trying to answer questions.

Now, do users value the problem blinkpro is trying to solve? Not enough do. Researchers like myself live with these tools and use them everyday (I review a bunch on my blog), but for the average joe, Google is the only bookmark they need. Furl, LinkaGoGo, all are really tools for users who need to track specific pages for themselves; they are not great for sharing.

Conversely, I find Del.Ico.us an exercise in frustration whenever I use it for anything other than "what's hot" or entertainment.

Yes, the "public/sharing" implementation of Blink.com was flawed... but that's because the problem Blink and Blinkpro solved wasn't the sharing, it was the storing. No one would notice if Del.ico.us killed all bookmarks not viewed in the past 6 months, because that's not what its used for.

So, great post, but I read all these lessons as a simple one: Implement to solve a single problem, trying to do too much will cause failure; and be clear on the problem you want to solve. Look at Del.ico.us: they don't care that it sucks for research; trying to solve both the sharing and storage problem would have dunked them. Blink was distracted by trying to solve the wrong problem; all the things mentioned above are just symptoms of that main issue.

Posted by: Michael Wexler on December 22, 2005 01:15 PM

I really dunno if i'm posting this as a joke or for real. Bill Gates has written books about hiring people that have made mistakes. Does it makes Ari an ideal engineer/executive for Microsoft to hire in this post-dot-com/we-see-some-light-at-the-end-of-the-web-tunnel era? Just a tought.

Posted by: Antonio Ognio on December 25, 2005 02:16 PM

As one of those early blink users I have to say that the primary reason i stopped using it was the complete and total selling out to the advertisers at the expense of user experience.

Also the public / private and searching issues really made it much less useful than del.icio.us.

Posted by: masukomi on January 6, 2006 03:39 PM

I, like Michael above, also tried and quickly grew tired of delicious. I was looking for a great place to store and organize the bookmarks I actually use. I wanted to share some of my bookmarks with a select group of friends only. I settled on BuddyMarks.com (click my name). I have my BuddyMarks sidebar open all the time at work and at home. They have always used categories, and have just recently added tagging also (remember when tags were called keywords? I'm so 1999!).

If blink.com had 1.5 million users, it could hardly be considered a failure. It seems to me that it was done in by having too much money. I worked for three startups back then with the same problem. All issues were quickly solved with money. Just add more staff, equipment, marketing budget... Then the people handing out the money start looking for their quick payback. If you didn't look like an IPO/takeover candidate, they pulled the plug, and the business which could have worked with fewer people, less equipment, etc. suddenly was unsustainable.

Posted by: Peter on January 21, 2006 11:25 AM

The drawbacks of folders are also significant in filesystems. Any of Ari's blink examples could be a filesystem issue in a PC, eg does /Finance/ (ie your Quicken data) go under Business or Personal?

On my website, I've organized my blog postings in a tree structure, but it doesn't really work. Should a posting about a bug in Windows that allows websites to see your browsing history go under Windows, Hacking, Internet -- or Paranoia?

Originally Vista was going to have WINFS, a database-oriented filesystem so that files could appear at multiple locations in a virtual tree arrangement. I think that's been dropped now, or at any rated mutated beyond recognition.

Posted by: dannyw on January 30, 2006 05:09 AM

Ari - So glad your post provoked so many responses. To someone who commented, rumor has it that Yahoo paid $27MM for delicious.

I will say that mindlessly surfing the Blink public library was one of my favorite activities, and that the environment we were in forced us to get on our knees to the sales team. If things like adsense existed when Blink was Blink and not BlinkPro, we would have been able to use the bookmarks to create content vertical pages supported by contextual adsense revenue, fed to the world through RSS / XML / etc. feeds.

Who knows. Who knows. I did, and do, love BlinkPro to this day. But I think you got the memo I xeroxed and stuck in everyone's mailbox back in the day, so you already know where I stand on this issue. * sigh *

Posted by: Anittah on March 15, 2006 02:20 PM

Wow! what a great discussion!
One note on the folders vs tags debate
You have to realize that tagging is a superset of folders in what it can do. Tagging is a system that one can bend as he likes, because he actually defines his own categorisation system. Folders carry rules and restrictions making it a disciplined system, good for personnal but useless for social use. Tags are easy and flexible. And just because tags are used in pretty much similar ways by all (though there is no guarantee about that), there is a social value to extract.

Posted by: Harry on May 17, 2006 05:19 AM

Excellent analysis...it will help us all in our field. User Interface controls actions of the masses.

Posted by: Jawad on June 28, 2006 09:22 PM

I think every single person here has missed the real reason why Delicious "succeeded" and Blink "failed" - LUCK.

What advantages did the design decisions give Delicious? More users? Nope. More revenue? Nope. Faster growth? Nope.

I still think there is no business there - they are just features. Delicious did not win, they just got *really, really* lucky. How lucky? Read this:
http://redeye.firstround.com/2006/09/the_ma_lotto.html

Posted by: Actually on October 3, 2006 02:11 PM

wouldn't tags have the same problems as folders re: naming conventions? Someone could create tags for the same thing labeled NYC, New York city and Big Apple. I may be looking for Central Park or MoMA and none of these tags would help.....

Posted by: rob on October 4, 2006 02:06 PM

Yea. I agree with what you're saying here. In the end, you probably had the best team, but a breakdown in vision. Some of the other comments here are blaming the "privacy issue" and "timing." These would most likely consumer survey driven conclusions which would have practically nothing to do with vision. Vision is the anticipation of what consumers would really enjoy when they are presented the product as a whole, rather than a compilation of consumer reports.

I'd argue that current public opinion is dangerous, and can mis-direct your vision down the wrong path.

No survey will tell you how a consumer will react to your new product until they have the option to fully react to it.

Posted by: Eric Ni on November 15, 2006 04:07 AM