INNOBLOG

I set up my first lemonade stand in well over a decade yesterday. But the recent sunshine weve been getting here in Boston had nothing to do with it. In fact, as I think about it, nice warm weather is probably detrimental to the success of my new lemonade stand, as it might draw people outside, away from their computers. You see mine is a web 2.0 version of a lemonade stand; it exists on my Facebook profile.

But Facebook isnt the only place Lemonade.com helps people participate in e-commerce. In addition to developing an application for Facebook, Lemonade has code for users to put up stands on MySpace, Blogger, and other pieces of web real estate. These stands act as retail kiosks where the stand "builder can choose to display items he or she "recommends. There are roughly two million different items that can be displayed at a kiosk through Lemonades online retail partners including iTunes, WarlMart.com and Hotwire.com. A click on the displayed item takes potential customers to the retail partners site. If a purchase is made there, the retailer gives a 5-15% commission. Lemonade takes 20% of that and passes the rest to the PayPal account of the stand owner. Think of it as a more democratic version of e-commerce (or perhaps just a more "portable version of eBay).

Those commissions arent enormous, but they are more than a Blogger or MySpace user would get now for letting the world know that he or she recommends a book, song or handbag. And I think the chance for commissions is enough to drive and sustain adoption once the cool factor surrounding Facebook widgets dies down.

The idea also has an element of disruption going for it. These stands remove a barrier to consumption. Just as the innovation of online retailing removed buying constraints around location, allowing a buyer to purchase from his home instead of having to go down to the store; lemonade.coms "e-commerce for everyone removes some constraints around virtual location, allowing a buyer to begin the purchase process from many virtual locations like blogs and social network profiles, instead of requiring navigation to an online storefront like Amazon.com or WalMart.com.

So the name fits. Like curbside lemonade stands move the storefront closer to pedestrian and vehicle traffic, virtual lemonade stands move online storefronts closer to web traffic.

And I imagine an up-market march where these simple widgets improve; eventually becoming more complete online storefronts that would allow for a full purchase decision to happen in one little corner of a blog or social network profile, rather than via a link to the online retailers portal. Sure, critics will point out that clicking a link and opening up a new browser tab or window is a much less significant barrier than the one presented by having to drive a few miles to the nearest WalMart (and they do have a point there), but convenience is still convenience. I think these kiosks could present a considerable advantage over "virtual brick-and-mortar online retailing. Why would I go to Amazon. coms home portal or use Googles browser tool to search for "The Innovators Dilemma Clayton Christensen Buy when I can just click on my friends storefront while Im checking out his blog?

That said, even if the idea of a virtual lemonade stand proves successful, Im not sure that Lemonade.com will be. It wouldnt take more than a few weeks for Amazon, WalMart.com, or other online retailers to make similar widgets. And if the idea starts to generate significant cash, I dont see why platforms like Blogger, Facebook or MySpace wouldnt include this sort of functionality in their own code, squeezing Lemonade.com right out of the niche its currently trying to create for itself.

For now, Ill try to make some "lemonade of my own. Feel free to help out below. :-)