Tonight Jason Fried from 37signals spoke at the Oriental Theater in east Denver. He discussed everything from client deliverables to the 37signals four-day workweek. In essence, Jason’s talk boiled down to three key points:

1. Don’t work on hard problems. Break them down and keep things simple.
2. Avoid distractions (open office environments, meetings, e-mail, etc.) get a site or product out of your head and into production ASAP.
3. Deliverables are bullshit, clients don’t care, the end product is what matters.

First off, I want to say I have great respect for 37signals and their impact on the industry. Having the chance to talk with Jason about issues such as: stopping IE6 support, disregarding Photoshop in the design process, and scaling with growth, was an absolute treat. Clearly the team at 37signals is one of the most innovative and talented in the industry.

However, I think 37signals dominance in the web products field has distorted their ability to critique the client-based approach. And while I don’t have knowledge to speculate specifically on day to day client interaction, I do have a few things to offer from a developer perspective.

Team chemistry is important.

First, people working from home all the time can be harmful to the group chemistry. Jason and team do a huge amount of work via telecommuting. Relying on campfire, screen sharing, and video chat interactions for the bulk of their communication. They feel this helps minimize distractions and keep people productive.

I’m not sold this is the way to go. I think it’s hard to truly feel connected and dedicated to your team if you don’t spend real time with them. When’s the last time you became really good friends with someone without spending some serious face-to-face time with them? For me it’s never happened, not once. And as great as chatting online is, it’s not the same as being in the same room and hashing things out. You miss the subtle face gestures, the inside jokes, the bantering, and the all around comradery that happens in the workplace. Part of the reason Imulus does great work is because we have dedication to one another. Even on days when I’m completely out of wack mentally I still find myself focused on helping the team. Why? Because I’m relied on to help create the great stuff we build. And I trust those I work with to do the same. As ridiculous as our office gets sometimes in the end we get shit done and we do it for each other and ourselves.

Deliverables have a purpose, it just needs to be refined sometimes.

Second, I don’t buy that all deliverables are bullshit. Just as some companies like to skip Photoshop (37signals) and go straight to coding, and others (Apple) like to make mockups pixel perfect it’s impossible to say that one solution is better than the other. Yet, we can agree that certain processes work better for certain people as well as certain projects.

Let’s talk about the way we work. Imulus’ basic approach is to offer the client a timeline, design brief, wire frame, and mockup of the final interface. Now, it’s important to realize that we haven’t always done it this way. In fact, for some time before I came to Imulus the wireframe process was basically nixed. What was the result? Instead of 5 hours spent reworking things in the wire frame process, 25 hours was spent reworking things in the development process. Look, we aren’t naïve, we recognize that clients change their mind and get new ideas all the time. However, we’ve found that most of this re-thinking takes place in the wire frame stage. And therefore we save hours of coding changes by altering the approach up front. In essence, if you’re building a car and the frame is faulty, why wait until the upholstery’s getting put on the seats to fix it?

Still, we know it’s a strong possibility that some of our deliverables are blown out of proportion. And as most firms do we will continue to collaborate and narrow down our inefficiencies. However, we have found that some deliverables are an extremely important step, and just because some projects or companies don’t require them doesn’t mean they aren’t important.

In conclusion

Clearly 37signals has clout and track record to support the way they work. And regardless of how that alters the Imulus process we love hearing about it. It’s phenomenal that they have so much passion behind what they do. I hope over time we can refine our own process to the point they have. Until then it’s great hearing a second opinion about things.

Another local interactive agency has been assimilated.

This time, Boulder-based texturemedia has been acquired by Miami-based Crispin Porter & Bogusky. Just last year around this time news was posted about the merger of Xylem Interactive with Creation Chamber, forming Xylem CCI. I actually truly hate to see good competition go away but I’m also excited to fill the void created by texturemedia moving to larger budgeted projects.

We’ll see if any ex-texturemedia clientele start knocking on our door. Congrats to texturemedia! You guys did great work and hopefully CP+B doesn’t change that too much.

In the last few years we’ve had a handful of clients ask us to adopt a performance based payment model. Usually these are start-up companies who are cash strapped and looking for an alternative to paying our service fees. I’m intrigued by the idea of performance based web work however I’ve yet to find a model which I believe is both fair and incentive driven.

I’m still trying to find the right solution. I’m not sure what works best, but I have a pretty good idea of which models I think will tank. Here are a few situations which we’ve been confronted with.

Ecommerce Web Site
The client was offering us a small percentage of overall sales along with a partial reduction in our regular hourly rate. The client was hoping that we would be incentivized by the offer they made us. There are several problems with this model for both sides.

1. What about offline sales, phone calls, emails or faxed orders? We can track the online sales but we have no visibility into the offline orders.
2. How competitive is the product / offering? We have no control over the price of the product or which products are in-stock. We could dedicate plenty of effort building a great system but if the client’s products are overpriced or lack selection then sales revenue won’t materialize.
3. How much is the client willing to pay for marketing? Our agency can do the SEO / SEM work but ultimately SEM and online advertising incur real costs, and not just man-hours.
4. What is the level of marketing they are willing to pay for and who has final say in terms of strategy and creative?
5. Our team could sit back and collect commissions for the client’s sale efforts. That wouldn’t be right, but under this sort of arrangement it could happen. Or vice-versa where the client could get away with doing nothing but filling orders.
6. What is the cap on the number of hours we would commit to each month? If we are spending 80 hours each month and sales commissions only equal $2,200 then our effective rate would be $27.50 / hr. If we agreed on a base hourly rate plus commission then perhaps hours wouldn’t be as important.

Lead Generation Website
In this scenario a client approached us to reduce our rate in favor of a lead generation forumula which incentivized us for creating “qualified leads” in Salesforce.com. To complicate the scenario we would be working with the client and other third parties including an SEO firm, Content Writer, and a PR Agency. The arrangement gave us 4 tiers by which our monthly charges were either reduced or increased based on performance.

We had an existing retainer in place which discounted our hourly rate by 20% for the commitment from the client for a fixed minimum of hours dedicated per month. This proposed program would start us at a reduced rate which is 40% less then what we typically charge. From that, if we perform well enough, we could make 20% back, bringing us to our current retainer rate. On the other hand, if the performance dropped, our hourly rate could go down to 50% of our regular rates. In my mind that is not an incentive, it’s a carrot and stick.

The proposed formula work like this:
Qualified Salesforce.com Leads / Total Unique Visitors = % Conversion

Here are the problems with this formula and the overall scenario.

1. What if the budget for SEM goes up and the third party SEM company starts driving 15% more traffic, but the traffic isn’t qualified? It will dilute the conversion percentage.
2. What is a Qualified Lead? In Salesforce.com we can drive leads but the aspect of qualifying them is arbitrary. Ultimately, that aspect comes down to trust but it sure would be nice to remove arbitrary valuation.
3. The SEO & PR companies are going to have the highest influence of the company’s natural rankings. If these two players hurt or hinder traffic then we suffer as a result.

We counter offered the client a true incentive program which kept our retainer rate at a discount of 20% while suggesting the incentive to reach full rates if we exceeded expectations. If we knocked expectations out of the ballpark, then we would be rewarded with a 10% increase to our regular rates, making work in this client particularly attractive. Unfortunately that suggestion was not accepted.

Does anyone else have similar stories to share? In browsing the web I found these.

GraphicPush: Commission Based Payment for Web Design

Manifest: The First Step in Creating Passive Income

Harking back to my last post about educating on the topics near and dear to interactive agencies, I’ve arrived at another topic; hits are not visitors. These metrics are incredibly useful when evaluating a site for marketing purposes, hardware requirements, coding methods and load times.

So first, let’s define the difference.
A “Hit” is a successful request to your web server from a visitor’s browser for any type of file, including an image, HTML page, MP3 file etc… A single Web page can account for several hits. A simple page might include a logo image, CSS file, HTML code, 6 image based navigation items with 6 more images for rollover effects. The net hits for such a simplistic page would be 15.

By contrast, a “Visitor” or “Session” is a series of clicks by a particular user on your site. If I load the same simple web page in the previous example it would be considered 1 visit. Sessions / Visitors to your site are all given a unique anonymous IDs which track the user throughout the site. The “session state” is used by the Web site to remember things like login information and shopping cart contents.

For comparison purposes let’s look at an example of the differences between hits and visitors using one of our clients for the month of March 2008.

Total Hits: 792,487
Total Visitors: 26,104

So yes, it is important to note the difference in the two measures.

A special note though; Google Analytics won’t track Hits because it uses JavaScript to check visitor behavior and for this reason Google isn’t aware of every hit back to the Web server.

One of my favorite aspects of doing this job is the proposal process. That moment of introduction where the client is feeling us out and we are doing the same. It’s sort of like the interview process with a new hire, both parties are usually amicable and share their vision of the future which usually reveals their level of understanding about the project. For us, this initial meeting and the discussions immediately after are the basis by which we develop our proposals by using the following 6 factors.

1. Are We a Match: I don’t believe in doing work for the sake of generating revenue. We want to work on projects we can get excited about. If the project isn’t exciting then it’s going to be a real drag to work on. I shouldn’t have to motivate the team to work on the project, rather the work should excite and invigorate the team to get the very best results and creativity.

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