First, let's start off with the basics. On Linkedln, Craig Sherman graduated manga c** laude in East Asian Studies from Princeton University. He also received education in buisness, internet and marketing. He worked with a variety of East Asian companies such as the Japanese and Korean parts of AIG and Cedent Japan, just to name a few. There are also other references of him dabbling in places like Photobucket, Logoworks, Homestead, My Heritage, Net Quote, Single Feed, and Zip Car (I can not confirm and cross reference most of those, but for being on the board of directors of Logoworks, I can-Logoworks. I believe though, that he isn't a part of it anymore, but someone can double check for me on that?BTW, these additional companies do NOT show up on Linkedln)
Now, one of the few interesting cases among his many other companies he worked with, is MyFamily.com. According to Linkedln-
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Craig was COO and CMO of MyFamily.com, where he helped grow the company from $23 Million to $140 Million in sales. During his tenure, Craig helped re-focus the company on its consumer subscription business and grew that from 200,000 to over 2 million subscriptions, taking the company from significant losses to profitability. He joined MyFamily.com through the company's acquisition of ThirdAge Media where he was first evp and gm and, after the merger, president.
At AIG-
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Craig ran one $90mm AIG division; additionally, he ran all marketing (as well as all internet sites) for AIG in Japan and Korea, totalling over six billion dollars in annual sales. He quintupled the growth rate of his division and ran Japan's number one insurance website.
At Cendent Japan-
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Craig first architected and negotiated the creation of the joint venture company as an employee of Cendant Corporation, then worked as vice president of product and marketing, and subsequently became ceo. He helped grow it to 500,000 paying customers, $23mm in sales and operating profit in 3 years.
Now, all of this sounds wonderful and it sure seems like he has some expertise, especially in taking failing companies and turning them around. But the one thing that puzzled me the most was-why did he come to Gaia? Was it because Lanzer and some of the other original founders were East Asian? Was it the manga that drew him, which reminded him of his younger days?
So I, with the help of Snow White Chocobo, uncovered a series of highly interesting interviews made during the time Gaia's layout was being changed.
On Internet Revolution, an interview dated 7/28/08 was between Internet Revolution and Sherman. When asked about the money making aspect of Gaia, he responds-
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It was all purely organic. People donated to the site because they loved it so much, honestly. And then the founders gave virtual items back to them as a gift. The moment they did that our sales tripled, our donations tripled. Then we hit on one of the two parts of our business model, which is virtual goods. We sort of cracked the nut in that category of virtual goods. Virtual goods and virtual micro-transactions are extraordinarily big in China, Korea, Japan, and growing really quick in Europe. In the States they're just starting to grow fast. But I think you need a world to do it -- it doesn't make as much sense inside a social network. They don't see it as successful in the U.S. social networks.
Now, this first part already reeks of misinformation of the nature of items on Gaia or just a calculated statement. Micro-transactions refers to the Gaia Cash cards directly and the concept of having a Cash Shop/Cards to which money is "donated to the site", a thing practiced by MMOs like Perfect World, based in Korea and Flyff, based in China. Now isn't that interesting? Both and centrally free-to-play and this model was adopted on Gaia, but most likly before even knowing about PW or Flyff. Another, very disturbing part in this is that is the fact that "sales tripled and donations tripled. Now, he says this during the time some of the devs claim "Gaia's in the red". Hmmm.
He goes on to say-
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So that's one part of our business. The other is the advertising model. We're just being really careful to pick sponsors that are a good fit for our audience. And we put a huge amount of investment in trying to create an experience that, whichever brand it is, adds functionality to the experience for the user. Which -- surprise, surprise -- means the brand is doing really well also. So, we're really lucky. In short we have two models -- virtual goods and sponsorships -- that are both doing well and growing very fast. It's one of the reasons I think we're fundamentally different from the social networks.
Okay, now how many people have complained about this particular issue? Countless, countless people. During this time we began to also see more sponsorships that weren't exactly in the vein of Anime, gaming or mangas-we saw things like Scion and MTV. But what he means by "functionality, is covered in this and another interview, where he talks about "a feeling of reality to the world" which is an interesting concept of Gaia that he has.
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Actually, we've already started doing that. So, absolutely. We have many elements of the Gaia experience you can take from Gaia and bring to other sites, and a number of experiences where you can bring something in. You can take your avatar and take it to your MySpace page. On the reverse, you can put a link into your Gaia profile that connects you back to your MySpace page. We have half a dozen other examples. Probably the most prominent one recently is we've created a platform to allow independent games to be hosted inside the world of Gaia. We rack those games with all the social tools and identification tools inside the Gaia experience. So you're playing a flash game made by a third party, but your avatar appears along with other people's avatars above the game.
The tools are open; the process by which we add them onto the site isn't. We have users evaluate games and vote on them. In fact, when we offered the first suite of 200 games for people to judge, we had over a million votes on those games in less than 24 hours. And then, of those, we started by picking the top 10 that users thought were the best and then we added those into the site with all that integration. We're basically letting the users decide which ones they think are best for the community.
The tools are open; the process by which we add them onto the site isn't. We have users evaluate games and vote on them. In fact, when we offered the first suite of 200 games for people to judge, we had over a million votes on those games in less than 24 hours. And then, of those, we started by picking the top 10 that users thought were the best and then we added those into the site with all that integration. We're basically letting the users decide which ones they think are best for the community.
This was a very central issue for many, many Gaians against the feeds-a user named Almyk created a petition against exactly this-feeds in particular, but also the "making into facebook/myspace" as well as the exporting bar in the forums that export directly into Facebook, Myspace and Blogger, just to name a few. That petition was made a month or two after this interview. (or maybe it was three, but it was a very quick response)
The games thing is not an area I know extensively-meaing what he's referring to. I have a little bit of knowledge on it, but if someone can clarify that part, that would be great.
Another interview on Gamasutra sports some new light on Sherman's viewpoints.
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So I think it did start out with a very strong anime, and gamer, and community focus. And over time it's broadened, so now you can describe it more like an online hangout for teens and people in their twenties. Or you can say it's an activity hub, and activity portal on the net, but with a meta experience around it that feels more like a place, rather than a tool or a website.
The thing was... he's departed gravely from the main focus of what this site was intended to be. The "sticking to one demographic" was merely one poin [ N.K ] made in a thread in SF. The demographic was supposed to be mostly anime/manag/video games but it suddenly turned into a "hangout"? That's just exactly what Myspcae and Facebook do so well-and Gaia was what set it uniquely apart form these sites.
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I think you can make good businesses concentrating on money, but I don't think you can make great businesses. I think if you look in history, the businesses that really stick out, and we aspire to be — not saying we are today — but that we aspire to be, it's ones like Disney. It's the ones where creators built something great that came from their hearts, that connected with other people, and they were obsessive about listening to a customer when building things that they wanted.
If that was the aspiration, then why do many people still complain about accounts they haven't got back and unsatisfactory customer service, among other things? It's not exactly perfect, but I do believe the communication between staff and users was much cleaner than it is now with so many members. I completely agree with creating something from the heart, but the problem is, many customers don't feel like they're getting listened to. They offer wonderful ideas-but granted, some aren't so hot-but just the fact that you show that you listen is great.
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So the key to all this is being incredibly transparent with your user. And we're being really careful about that. So we tell our users everything about how, why we're going out, and rationale for bringing in advertisers into our site. And generally, once they understand, they agree. Or suggest an alternative, and we come up with it.
And yet, there's so many numbers flying around about how much it costs since people left and right have to actually scour the net to double check and make sure it's truthful.As some have suggested, had Gaia been completely open with their budget, even admitting some of the not-so-smart expenditures (I've heard about nerf (?) fights and company picnics and yeah, that's not exactly smart if you're "in the red" but I think a few of those things have been cleared up. Again, if someone could provide more information, that would be wonderful.)
And just because one understands doesn't mean they agree. We agree Gaia needs money, but some dislike what's being advocated-MTV on a PG-13 site, Scion (for a time), Skittles (some people didn't like the prominence of it in the Easter event this year) and House Bunny (I like the items, but the movie endorsement was...uh, strange), just to name a small few. Alternatives were made, of course, but they didn't balence it out as much as it was hoped. Sonic got fair exposure, but the Blue Dragon thing didn't stand out very much in my mind. Tsubasa though, I heard, was a huge thing. Magic the Gathering was very appropriate and stood out very clearly in my mind. So yes, there's the good and bad on that particular issue.
Now, you have to look really hard for much substantial information on this guy and while it's a bit demanding, I decided to do this because I think Gaia should know, if they aren't already informed.
So, Gaia, I bring to you this evidence to the table. It is no longer so much a financial issue as in this buisness launching that does not seem to be benefitting it well.
But what should we do?
+Get back on track by being transparency, like it was stated that Gaia was being
+Be more aware of how you're comments are being received. Show that you care, and not just it calling this a "hangout"
+Keep on the track of improving communications. The forum for that purpose was a great start-but be sure to stand and deliver on that.
I will update this with more when I hear any other good ones.
*This was adopted, with a last paragraph deletion and modification form the original thread The links to both this journal entry and the thread will be spread around as much as possible.
