Trendspotting At Web 2.0 Expo

I recently spent a week at the Web 2.0 Expo in San Francisco, CA. I had a ball. There’s something (dare I say Worldchanging?) about the O’Reilly events this year. There’s a sense of community, shared responsibility and agency in the air. It’s one thing to be social in the blogosphere and participate in online communities…but it’s quite another to be physically present among this many smart people clustered together, sharing their data, ideas and experiences. Over the course of the week I saw a number of presentations that echoed common ideas about what’s going on right now, and what forces the major players are responding to.  Here are 5 of the most noteworthy trends:

Local Is The New Global

Consumers are increasingly taking a look at their lives through a local-lens and using the web as an information resource to improve their offline experiences and purchasing power. The emergence of mobile phones as computer devices (i.e. GPS-enabled iPhones etc) lines are blurring the lines between online offerings and on-the-go, real-world ones. Geolocation services on mobile devices, as well as off-line meetups organized online, embedded mapping and “find near you” services on the web are hightening people’s awareness about what’s around them and getting them out of the house, building communities in their local areas.

The data presented by Siva Kumar (TheFind, Inc.), Scott Dunlap (NearbyNow, Inc.), Joel Toledano (Krillion, Inc.), Ethan Stock (Zvents) and Greg Sterling (Sterling Market Intelligence) was paricularly interesting. We saw that e-commerce just isn’t taking off the way that everyone thought it would – which is a pretty heart warming in a lot of ways (many of us thought that the web would eventually kill off local shopping). According to the US Census bureau, e-commerce is still less than 4% of US retail. The insight is that more and more people are still using the web to window shop, but are still buying in stores…so e-tailers are now submitting to the reality, shifting gears and focusing on maximizing their online-drives-offline strategies. Pretty interesting stuff. (This slide was taken from the “Why Local Is the New Global” slide deck that can be found here)

Don’t Develop In The Dark – Opening Up To Your Customers Early Is Critical

Open-social development for high-tech products has been a getting more and more press recently. Many startups have found that the more they protect their product during their development life cycle, the more they find that when customers hands finally touch the product, it is unusable, buggy, or defective. Smart startups are opening the kimono to their customers earlier these days, experimenting and iterating a ton and realizing huge benefits that allow them to imagine, design, and build new products with real time feedback that they know their customers want. The hard lesson many entrepreneurs have learned these past few years is that true customer insight starts by including customers in the development stage. This used to be a scary thought, but the thinking has shifted. Now what’s scary is making decisions based on opinions, rather than real facts and feedback.

The Current Mobile App Business Model Is Broken

Since the release of the iPhone, the $0.99 mobile app has been the norm. The harsh reality is that the majority of mobile app developers can’t make a living at that price. Hits like Smule’s Ocarnia had developers rushing to market with apps that bombed. Studies have shown that, across the board, users stop using average apps quickly, that long-term users make up only about 1% of total downloads and that, although paid apps retain users longer, there’s still a steep drop off (within 90 days). To ensure long tail developers carve a sustainable position in the long term is going to require some rethinking on both ends of the spectrum, and consumers may end up having to accept higher per-app prices. Still, the mobile market is growing rapidly (it doubled in 2008) worldwide, so there’s tons of opportunity moving forward.

Transparency Is Hot

I might have heard the word transparency used 10,000 times over the week – not an exaggeration. Not only does the theme of personal authenticity come through loud and clear in discussions about what it means to be a digital citizen, but people are expecting authenticity and openness from governments and business as well. Governmental transparency is an especially hot topic. The economic crisis has given the geeks a major reason to band together and use the tech they love for good. What’s exciting is that the potential for Government 2.0 is real. Technology-wise, people everwhere are coming up with solutions that show that we can now cheaply and efficiently enable a government that is transparent, participatory, collaborative, and effective. But there are some very real, very stubborn obstacles in the form of outdated laws, regulations, and policies that the tech community still has to (and wants to) take on. Collective action is key and the tech community is using every tool they can in their belt to create groundswells to get at the raw data.

People Want The Whole Story

I say this with a smile on my face…I really think that people who live in the connected, digital world are done being sheep. Millions of people are starting to care about where their products are coming from, who’s building them and how they were built…and they are expecting businesses, governments etc to be human. If you havent seen it yet, check out the Web 2.0 keynote given by Jake Nickell and Jeffrey Kalmikoff (founders of Threadless) at the Expo. There’s a lesson in their message: People care where things come from and companies can create thriving communities around ordinary things (like a Tshirt) by connecting their customers to the story of the product. That a T-shirt was made by a girl who lives in a village in Japan, for example, can make a big difference in how much a customer cares about that product. Stories make products special and draw a crowd. This lesson can be applied across the board, and is the driving force behind dozens of new, budding industries.

Final Thoughts – Participation Is The New Black

Across the board at Web2.0 there was one common theme. Participation is in. People don’t just want information, they want it raw, they want it now and they want to be able to act on it and be a part of the process. Consumers want to use the the web to research before they buy, users want to participate in the development of products, and we are all demanding to know where our products come from, how businesses and organizations operate and what the government is doing with our money. We are sheep no more and tremendous opportunities lie before us. It’s an exciting time to be alive.