Dan Nedelko

So I was going through my normal hundreds of morning emails and although I generally breeze through Seth Godin‘s posts (I’ve found them to be the equivalent of Tweets, short, uninformed, the internet equivalent of a sound bite without substance) this particular post made me pause:

Everyone gets paid on commission

Beyond the fact that it’s about 5 lines long I have a number of issues with what Seth is proposing here:

1. Being paid on commission implies that every function is customer facing. In any company there are support, infrastructure and secondary functions which make an organization actually work. How would you propose calculating their commission. Generally Seth, these are referred to as bonuses.
2. Not every post, article or piece of news media is directly measurable. Example: Sunday Morning Political Talk Shows, they have a very low directly measurable audience. However their influence through syndication, media discussion is substantial. Should these shows and their hosts be measured on commission?
3. Doing great work does not neccessarily mean that there is a definable B2C conversion rate attached to it. You often mention branding, customer loyalty and the like in your books and blog. Now you seem to contradict yourself by saying every action must have a measurable conversion to a sale.
4. In the world of journalism it isn’t always about appealing to public appetite. In fact it is about the media informing the public, in your world I would predict that many journalists would simply write what is convenient to increase rating (or traffic).

Those are a few of my reasons that Seth Godin is way off base here. Seth, take a couple of hours off and watch Glen Gary Glen Ross then think about your post, your position and the fairly shallow insight you provided. Is that thought leadership?

Unless of course you meant bonuses and incentives rather than commission.

More interesting financials from online casino operator 32Red. Looks like they had an increase in active players, which is always good (customer service and retention likely get credit for that) but a revenue drop of 11%. Here’s a brief synopsis of the interim results:

1. Overall revenues -11.2% to £5.8m, from £6.4m at the same point in 2008.
2. Active Casino Players +23% 14,490 over the same period in 2008.
3. New Casino Players +19% to 9733 over the same period in 2008.
4. 32Red now accepts Paypal transactions (one of the few to do so).
5. Invested £400,000 into backoffice and infrastructure.
   

Some interesting quotes from 32Red:

32Red attributed the fall to “the challenging economic environment faced by the UK and the rest of Europe during the first half of the year”

“Despite the global recession, 32Red has managed to grow its new casino players by a record 9,733, driven in part by our new television advertising campaign that has helped deliver a lower cost of customer acquisition. 32Red is well positioned to take advantage of any improvement in market conditions.’’- Ed Ware 23Red CEO

Looks like the recession, economic climate and consumer’s fear of spending on credit continue to affect the bottom line of gaming operators. But kudos to 32Red, they have the exact right idea. Investing into marketing now is the route to go – they’ve acquired new customers through investment in marketing. Obviously a revenue slip is not what you *really* want but then again during a global recession online gaming will be hit very hard. Particularly if the operator is seeking “retail” or casual players as opposed to heavy gamblers.

They’ll be well positioned to retain those clients and activate them when spending trends begin to rise. Smart business in tough times.

Related articles:

• Wal-Mart website lets other retailers sell products (cbc.ca)
• Measuring Influence on Twitter (daveduarte.co.za)
• Revolutionizing customer care (slideshare.net)
• William Hill set to lead the field offshore (telegraph.co.uk)