op4.com case study

OP4.com: Our Place 4 EverythingEric Niemiller & Zach Evans

OP4.com – The Beginning

• Co-founders started the site to have a positive web community and portal for kids

• The site would allow teenagers to:– Congregate– Discuss topics in chat rooms– E-mail– Submitting articles

OP4.com – The Mission

• To create and position a web site as premier youth-oriented site, with proprietary content as a cornerstone

OP4.com – The Method

• The site was to rely on a unique user aggregation model– One of the founders owned a motivational

speaking company that had a reported reach of 10 million North American high school students

– They intended to stand out from the crowd with grassroots, viral marketing

OP4.com – The Challenges

• Co-founders understood there were several challenges to overcome in designing a web site:– Page size– Features– Attention span of browsers

OP4.com – The Advantages

• They also understood that a web site offered several advantages:– Content could be dynamic– Technically an infinite space– Accessible worldwide– Ability to conduct business

Development Research

• OP4.com had researched anticipated costs of designing the site:– Sophisticated e-commerce sites could easily

exceed Cdn$200,000 (US$150,000)– Typical costs were Cdn$300-500 (US$225-375)

per page– Cdn$50-150 (US$35-115) per graphic– Cdn$2,500-5,000+ (US$1,875-3,750+) for

database functionality• Increases significantly with the number of products

sold

Types of Web Sites

Brochure Site

• Purpose:– Potential customers from around the world

can learn about a company.

• Typical Features:– Some graphics– Description of the company– E-mail link or guest book form

E-Commerce Site

• Purpose:– Customers from around the world can purchase

your products or services via the Internet.

• Typical Features:– Features of a brochure site plus:– Customer shopping site– Credit card processing– Customer security functions

Marketing Site

• Purpose:– You can increase consumer awareness of

your company or your brand or services by strategically linking and affiliating your site with related sites.

• Typical Features:– Features of a brochure site plus:– Advertising (e.g., banner ad exchange)– Marketing (e.g., affiliate program)

Community Site

• Purpose:– A portal site, you can create an attractive

audience to sponsors by driving people from your disparate sites to your central community site.

• Typical Features:– Features of a brochure site plus:– Advertising (banners)– Sponsor site integration– Features to support community (email, chat,

message boards)

Database-driven Site

• Purpose:– You can allow your customers to access their

account data, search for documents that support your product, or learn more about products or services you sell offline.

• Typical Features:– Features of a brochure site plus:– Custom database design– Search tools

Extranet Site

• Purpose:– You can use your web site to share sensitive

or confidential information with your customers or suppliers in a secure fashion.

• Typical Features:– Similar to a database-driven site plus:– Password-protected access– Data security functions

A Tale of Two Design Firms

MillenPro Mock-Up

• Built a landing page

• Developed a logo for OP4.com

• Incorporated a short questionnaire for collecting pre-launch registration data

• Total Cost: Cdn$34,000 (US$25,500)

MillenPro Problems

• Not sure that they understood their youth-focus

• Disagreement arose over data

• Requests for changes took a couple of days before responses were given

• Management had to go over new requirements an average of three times before project manager got it

BaseSync Profile

• Considered a Vancouver ‘hot shop’ for innovation

• Swamped with projects– Had to be convinced to provide a business

requirement document– Cost: Cdn$25,000 (US$18,750)

• Estimated cost site at Cdn$450,000 (US$337,750)– Future changes estimated to cost Cdn$35,000

(US$26,275)

BaseSync Problems

• Proposed site price range very high

• Were extremely busy and often turned down projects

OP4.com – The Choice

• Needed to make a decision fast:– Competitors were already launched and

acquiring thousands of new users on a weekly basis

– Competitors were gaining huge exposure in the business and popular press

• Had to chose which design firm to go with

OP4.com Competitors

Bolt.com

“…a leading web and wireless platform for 15 to 24 years olds that provides cutting-edge communications tools that enable young adults to interact in a relevant, member-created environment.”

“…the premier direct marketer to this demographic group” (teenage girls and young women).

iTurf.com

“…media, direct marketing and marketing services company targeting Generation Y, the more than 60 million boys and girls in the United States between the ages of 10 and 24.”

Alloy.com

“…the Internet’s leading information and entertainment destination for teen and young adult gamers.”

Snowball.com

OP4.com SWOT Analysis

OP4.com Strengths

• Co-founders understood the need to outsource web site development

Project Definitions

• Successful Projects – The project iscompleted on time and on budget, with all features and functions as originally specified.

• Challenged Projects – The project is completed and operational, but over-budget, over the time estimate and with fewer features and functions than initially specified.

• Failed Projects – The project is cancelled before completion.

Project Resolution History

16%

27%

26%

28%

31%

40%

28%

23%

53%

33%

46%

49%

0% 20% 40% 60% 80% 100%

1994

1996

1998

2000

SucceededFailedChallenged

Overruns and Deficiencies

Company Size Cost Overruns Time OverrunsContent

Deficiencies

Large 178% 230% 58%

Medium 182% 202% 35%

Small 214% 239% 26%

Success by Project Size

55%

33%

25%

15%

8%

0%

0% 20% 40% 60% 80% 100%

Less than $750K

$750K to $1.5M

$1.5M to $3M

$3M to $6M

$6M to $10M

Over $10M

OP4.com Strengths

• Co-founders understood the need to outsource web site development

• User aggregation model

• Only teenage-focused site with a mission to promote a positive self-perception and outlook

OP4.com Weaknesses

• COPPA - Children’s Online Privacy Protection Act of 1998

COPPA 1998

• Requires web sites directed at childrenunder the age of 13 to obtain ‘verifiable parental consent’ before collecting personal information online

• Requires these web sites to disclose in a notice:– Its online information collection and use practices with

respect to children– Provide parents with the opportunity to review the

personal information collected online from their children

OP4.com Weaknesses

• COPPA - Children’s Online Privacy Protection Act of 1998

• Already behind several competitors

• Advertising-based revenue model

• Lack of e-commerce capabilities

OP4.com Opportunities

• Take even more advantage of rapid adoption of Internet by teenagers

• Addition of e-commerce capabilities

• Partner with other online content publishers and/or content consumers to share content for a fee

OP4.com Threats

• Teenagers view of what they like andwhat is hot changes rapidly

• Better funded American-based companies

• Coming-of-age of IM technologies

• Advertising-based revenues could falter

OP4.com – The Update

OP4.com – The Article

• OP4.com web site was launched on October 18, 2000 in Toronto– Launch party was attended by about 150

teens– Co-founders, in typical Internet-hyped fashion,

rode into the film studio riding retro scooters

OP4.com – The Picture

Picture caption: “A launch party for OP4.com—a hot new web portal for teens. It went out of business a few weeks later.”

Questions?