I appreciate your analysis of the Hubsta business model, however, I would really like to see your analysis of NZ Herald business model and online shopping.

The idea of buying from the NZ Herald site just doesn’t work for me. There is clearly a strategic decision that they can convert their news audience into shoppers. This feels like a really bold assumption. I am not convinced!

Is the NZ Herald foray into online shopping a valuable new area of core business? or a distraction/dilution that they will come to regret? Your thoughts?

I think the video worked very well and felt pretty professional. The initial idea of 8 minutes nearly put me off though – but I am glad I persevered!

I was naturally fascinated with the very in-depth analysis of the structure of Hubsta – I can state that my involvement (shareholding capacity only) is outside of my role with realestate.co.nz and Zoodle.

Thedeal was originally set up by Paul, Donna and myself back in 2006. It’s original concept and pretty much retains the principle of “overstocked items” as per http://www.overstock.com that is excess inventory of branded goods – it was never to be an imported reseller of cheap product.

I think there is clear space for these integrated sites to operate within the online retail environment with Trade me – they very much parallel the relationship that realestate.co.nz has with MSN and Yahoo! where we power their real estate channels.

I normally avoid such videos (even Matt Cuts efforts sometimes get tedious ‘cos you cant be sure what you are skipping past….) but in this case it worked well.

The Hubsta model is actually quite clever, and manages to avoid pretty much all of the strategic errors that were so obvious about Ferrit from the start. They also manage to get quite a lot of ‘free’ advertising by featuring products on the various herald pages, even though herald certainly clips the ticket it works out a lot cheaper than banners.

I would personally be reluctant to let my brand reputation be risked by third party vendors i have no direct relation to however.

While the Hubsta contracted terms of trade do specify reasonably robust service standards there are bound to be some companies that fail at some stage, and no matter who the customer service centre you talk to belongs to if you get a poor product, damaged, shipping issues, etc… then who will you blame for the issue? Hubsta? (nope) xyz co. that actually shipped the unit? (no) The Nz Herald? you bet.

YahooXtra have been with Hubsta since August. I think I’ll be leaving the videos to Bernard in the future – I prefer the ease of editing in text.

http://www.scoop.co.nz/stories/SC0908/S00016.htm

Lance