Author: Mike McLaughlin

How Much is a Domain Worth? Nope, Less.

Posted by Mike McLaughlin on Oct 17, 2010, in Thoughts , tagged with , ,

When we launched Naissance, we tried to get the domain naissance.com.  We got in touch with the owner of the domain and received an e-mail response that stuns me to this day.

As a Sunday diversion, here’s that response, along with my thoughts as I read it.

Hi Michael,

Thank you for your enquiry.

A search for “naissance” shows approximately over 27,300,000 results from Google.

I’m pretty sure I’ll only care about one of those.  And isn’t more results actually a bad thing?  Less competition sounds much better.

Names such as naissance.com are very much in demand especially as there are more than 60 MILLION domain names currently registered.

60 million.  100 million.  2 billion.  Who cares?  I get that this is supposed to make me think “Wow!  I really need to buy this domain!”  But logically I can’t quite figure out how.

If you consider that just recently Fish.com sold for $1,020,000, MyPremierCard.com for $135,250, JMM.com for $55,000 and HorseSupplies.com $52,500 etc there have been many other 5 figure sales – I’m sure that our asking price could be considered an investment for a domain of this quality.

This is my favorite part of the e-mail.  I laughed out loud when I read it.  Fish.com?  I’m not sure there’s a less similar domain or business.  And take a minute to check out HorseSupplies.com, I think it’s fair to say the buyer got ripped off.

The price of this domain is £16,500 Great British Pounds or US$27,820 (close offers may be considered).   This is a one off payment for the rights to the domain, however you will be responsible for paying the yearly registration (approx $30).

$27,820.  Seriously.  Our counteroffer?  $200.  It was not considered “close”.

The thing that puzzled me most is that shifts in technology continue to make the actual domain you have less and less important.  Browsers and search engines will find you, if you deserve it, without a perfect domain.  In fact, after a few weeks our site and Twitter feed both sit in the top 35 of 31.8 million search results for naissance. Not bad at all.

Oh, and if you’re interested, naissance.com is still available for purchase.

New Advisors Can Matter a Lot

Posted by Mike McLaughlin on Oct 14, 2010, in Thoughts , tagged with , , ,

Yesterday I had a conversation with a wirehouse advisor, Advisor X.  On the surface, he’s not someone an asset manager would focus on.  He’s:

  • New, with just one year of experience under his belt
  • Managing a book of business in line with his experience

If you asked most firms, Advisor X would not be someone to prioritize.  And yet, he profiles as a good target.  Why?  There are several reasons, but the most important is his affiliation with one of the biggest-producing teams in one of the biggest-producing branches in the country.  He’s closer to top producers than most every wholesaler who comes to the office.

Week after week Advisor X sits in on wholesaler presentations alongside numerous other less-tenured advisors and others looking for a free lunch.  And he blends in.  Wholesaler after wholesaler fails to recognize that he is a potential gateway to the most attractive advisors in the office.

This situation represents a challenge for sales teams.  On a broad scale it requires:

  • Improved understanding of team dynamics among advisors
  • Effective segmentation and profiling of advisors
  • Extensive coaching of wholesalers to enable recognition of these opportunities

More tactically, however, it requires wholesalers to take simple actions and improve the way they decipher branch dynamics.  Identifying Advisor X can be done by:

  • Grabbing 5 minutes of a branch manager’s time to discuss newer staff
  • Using existing advisor relationships to get insight on potential up-and-comers

Established advisors know very quickly who will and won’t succeed.  They know Advisor X.  And since most firms know and target the same advisors, an investment in digging a level deeper can unearth opportunities other firms miss.

RSS is Hugely Underrated

Posted by Mike McLaughlin on Oct 12, 2010, in Thoughts , tagged with

Yesterday we sent a quick Tweet out to both American Century and Vanguard regarding their blogs.  The reason?  Neither had the link to the blog’s RSS feed on the blog homepage.  We saw this as a missed opportunity.  Why do we think that?

First, let’s take a quick step back.  What is RSS?  It’s Really Simple Syndication, which I suspect means nothing to many of you.  So here’s how I think of it:  RSS is a way to browse all of content from all of the Web sites you read every day in a single location. No surfing from site to site.  No repetition of clicking links and the Back button, dodging pop-ups and advertisements.  If you have Outlook, most of the individual articles/content you care about can be sent directly to your Inbox just like any other e-mail message.  Sounds pretty good, right?

Want to see what's in the latest edition of "Investment News"? Use RSS to get it in your Inbox.

Yet, few people actually use RSS.  In fact, after 15 minutes of Googling the most recent statistic I can find about RSS adoption is this Forrester study from 2008 that pegs it at 11%.  And the news might be worse within financial services.  As part of a client project this summer I surveyed 25 financial intermediaries about technology.  Only 1 of them had even heard of RSS, and none used it.

There are good reasons why RSS has not lived up to its potential.  But that doesn’t mean its promise is lost.  A little promotion and simple education is all that’s needed.

For firms like American Century and Vanguard, educating clients about RSS makes sure the people you want to read your content will read it more often.  If you are an asset manager or insurer with content and people to reach, education on “what is RSS” can help.  After all, someone may not think to visit a blog or Web site regularly, but they’ll definitely be opening their e-mail.

And to their credit, American Century has the RSS icon on the homepage already* and Vanguard indicated they’ll be looking into it.

* It’s possible we went temporarily senile and completely missed the RSS icon on the American Century blog homepage.  But two of us spent several minutes explicitly looking for it and never saw it.  So, this is our story and we’re sticking to it.

Hybrid Wholesaling Evangelism Needs a Break

Posted by Mike McLaughlin on Oct 08, 2010, in Thoughts , tagged with

Cerulli Associates recently released a report on wholesaling, citing the following as a central finding:

Hybrid wholesalers average approximately 50% of the production of a traditional field-wholesaler for 40% of the cost, but work best as complementary resources.

A press release for the report indicated that these numbers make a compelling case for the integration of hybrids within sales teams.  To that I say:  maybe.

Consider the efficiency results cited by Cerulli.  Taking the data at face value – 50% production at 40% of the cost, on average – even moderate variability means firms have a reasonable probability of actually seeing reduced sales effectiveness. We’ve done a lot of this research in the past.  Sometimes hybrid wholesaling doesn’t pan out.

Sure, firms need to consider if, and how, to use the myriad sales role definitions that exist between a pure internal and a pure external.  There’s real opportunity there.  But there’s no need to evangelize hybrid strategies.  The discussion should be about the thoughtful and detailed analysis needed for firms to decide what approach is right for them.

Hybrid wholesaling has been around a long time.  And it’s not right for everyone.

Facing Headwinds, What Can Hedge Funds Do?

Posted by Mike McLaughlin on Oct 04, 2010, in Thoughts , tagged with

How hard is it going to be for small and midsize hedge funds to survive, much less thrive?  According to two recent news items, very hard.

If a fund is preparing to launch, in startup mode, or somewhere south of $500M, this is gloomy stuff.  What do small/midsize funds do in this environment?

One option, of course, is improving performance.  But everybody is working tirelessly at that.  And for those funds below their high-water marks, it can be a long road back to attracting investors (and collecting performance fees).

A second option is to invest heavily in distribution, specifically via third-party marketers or by increasing in-house staff.  Under the right circumstances this is appealing.  But most small funds either hesitate or are incapable of investing heavily here.

The last option is the one with the best risk/reward profile.  It’s professional branding and communications.

Most small funds spend on a logo and other rudimentary branding.  Fewer spend on designers to help with materials (pitch books, fact sheets).  And fewer still use professional copywriters to refine their messages.

As a result, most hedge funds miss the best opportunity they have to stand out.  The hook, the story, the “what makes you different and interesting” is critical.  Small and midsize funds need to consider an investment in professional communications for three reasons:

  • Developing communications is not a core competency.  Investment experts are not necessarily experts at telling their own stories, nor do they always understand what prospective investors value most.
  • Very few hedge funds do it.  There’s contrarian value in using a tool most ignore.
  • It’s affordable. One year’s worth of management fees on $1M in assets (or less) is a worthwhile price to pay to improve a fund’s chances of standing out.

There are many reasons why hedge funds fail to attract assets.  A common one is that the fund’s story simply isn’t working.  Given some of the dire projections for the industry, it’ll be interesting to see if more funds invest in their communications.