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News Update – Best of the Day

daily1Monetizing social networking platforms still is one of the biggest challenges in social media. Now, if we have a close look at Reuters, Myspace and Twitter are planning new monetization models: Myspace becoming a place for video gamers and Twitter offering add-on services for business? If the Twitter plan will become the future for this social network, the founders need to think around different access prizing strategies in order not to loose the people that co-founded the business: small companies and bloggers.

Have you ever thought about how to use LinkedIn in an ideal world? Ari Herzog did. He shares his views and insights in his article 12 ways to use LinkedIn today.

London’s Piccadilly Circus is always a good place for the production of a commercial… Watch this funny Samsung spot for one of their mobiles.

Report says, social networks not used for purchase decisions

Social networks ‘rule’ our days. Nevertheless, their monetization outlooks may be hit by some news, I came across yesterday. A recent study by Knowledge Networks reveals that only 5% of users enter social networks for guidance on purchase decisions in any of nine product/service categories.

Everybody is talking about ways for companies to promote their services, products and brands. It seems that companies cannot exist anymore if they don’t integrate social media tools (Twitter, Facebook, MySpace, etc.) into their web strategy. And seeing the results of the study this seems to make sense. It shows that 83% of all internet users between 13-45 use social networks (47% regularly).

However, only 5% of the respondents say they are influenced in their purchasing decisions and seek guidance from social networks. Also, only 16% are more likely to purchase products from companies that advertise on social networking sites.

“Our findings show that marketers need to be prudent and people-centric in how they approach social media,” said David Tice, vice president and group account director, Knowledge Networks. “Social media users do not have a strong association between these sites and purchase decisions; they see them as being more about personal connection – so finding ways to embrace that powerful function is key. The fact that they are using social media more now than a year ago is a strong indicator that the influence of these sites and features is here to stay.”

Spot On!
The private aspect and the main intention of “staying connected” with friends and family is still the most important feature of social media. When people log in social networks it seems as if they switch to an atmosphere of privacy – and they don’t want intensive ads to interfere with peer interaction. Although the majority of users believe that ads on social networking sites are a “fair price to pay” in return to use the services for free.

People on social networks need to understand that operating a social network costs money and is not altruism business – and social networks operator should make this clear to their target group. Maybe the social networks should give people the option to either pay for access or accept ads, right from the registration process (or group together like the Social Globe). This might be a way to stop the ‘cost free web’ atmosphere…

PS.
Companies, to my experience, know that it makes definitely sense engaging in social networks. Nevertheless, there is still not enough knowledge and expertise on why, how and in which way to use social networks. Finding the right web strategy and the appropriate approach on how many and which social network activity makes sense, becomes the biggest challenge for them in the future. Rethinking their marketing, PR and sales processes is a must have to make way for an integration of social media into their company strategy. And Dell has proven that social networks are used for purchase decisions…

Study: How women use blogs and social networking…

A recent study Women in Social Media from BlogHer, iVillage and Compass Partners, shows that the motivation of women using blogs and social networking differs. Blogs for women follow the purpose to find the right information while social networking platforms have the ‘mere’ sense to connect.

The results state that US women are nearly twice as likely to use blogs than social networking sites. Blogs are seen especially valuable as a source of information (64%), advice and recommendations (43%), and opinion-sharing (55%). Social networking sites are more used to share their strong affinity to connect and to entertain themselves.

Women show much more interest and increase their activity in social media. So, women are turning to blogs (55%), social networks (75%) and online status updating (20%) to satisfy their interest.

The new study found that women spend less and less time engaging in traditional media activities like watching TV, listening to the radio, or reading magazines or newspapers.

And for women blogs are becoming more and more important as a trendsetting and purchase sources of information. Seeing the influence of blogs on purchase decisions, the study makes clear that women are more likely to buy a product after reading a customer post or reports about the item. 45% of survey respondents bought a product after reading about it on a blog.

“The scale of social media usage among US women continues to grow, and blogs remain the go-to resource for those who want to gather information, share ideas and get reliable advice,” said Elisa Camahort Page, BlogHer co-founder and COO. “At a time when the economy is top-of-mind for more than 70% of these active social media participants, women who blog are turning to online resources, including blogs, to help them make their day-to-day purchasing decisions.”

Spot On!
The influence of blogs on purchase decisions shows the importance for companies to evaluate blogs as a new important part for their media plans. Reading about the habits and attitudes, the study revealed that half of the survey respondents participate in social media activity daily and weekly or more often. When we think of the 42 million women participating in social media weekly, 55% of women do some form of blogging activity; 75% participate in social networks (i.e. Facebook or MySpace) and 20% are using Twitter. The data provided shows the change in the media landscape. While traditional platform face a decrease of importance, social media is on an all time high. The time seems right to rethink traditional and digital media planning.

UK: Internet users love browsing social media – less shopping

A recent study by Hitwise reveales that UK Internet users are spending more time browsing online media than ‘going’ online shopping. In March 2009 9.8% of all UK Internet visits were directed to social networking websites and 8.6% to online retail websites. Compared to 2008, the figures turned around (online retailers 9.7% – social networks 8.2%).

In the passed year, online retailers sawe a downsize in traffic from paid search like sponsored or paid for links on search engines (i.e. like Google, Yahoo!, Live and Ask) – 2009: 8.9% and 2008: 10,1% of visits to online retailers came from a paid search listing.

“The growth of social networking, online video and the continuing popularity of news websites has meant that an increasing proportion of consumer’s online time in the UK has been devoted to online media,” commented Robin Goad, Hitwise’s Director of Research.

The traffic that Facebook, Twitter, MySpace, YouTube and the likes generates for online retailers increased in one year from 5.2% to 7.1%. And social networks now generate 58.3% more traffic than webmail providers (Hotmail, Yahoo! Mail and GoogleMail). The best performing categories in 2009 were Auctions, Fashion and Department Stores.

“Social networks are a relatively small but fast growing source of traffic for online retailers,” commented Goad. “At present, only a minority of retailers pick up a significant amount of traffic from social networks, but many of those that do have seen a positive impact on traffic. For example, fashion retailer ASOS has a strong presence on Facebook and in March received 13.3% of its traffic from the social network. Another example – in a very different market – is online bookseller Abebooks, which currently receives a quarter of all its UK Internet traffic from social networks, more than it gets from search engines.”

Spot On!
Is this showing a trend that people are willing to buy products in social networks? In the UK, it sounds possible. It could be the next step. We all know that the easy purchase process is a winner – for companies and customers. Thinking of the future of social networks, companies should consider engaging with customers much more on social networks while also integrating ‘light’ e-commerce opportunities in their Facebook Fan pages or in their company profiles at XING. Or at least indicate and lead the way for customers to some good offers or marketing activities. And re-thinking efforts on big spendings for paid search is definitely something that needs to be thought about…

News Update – Best of the Day

According to a Microsoft research the time peole are online in Europe will be more than the length of time they spend watching TV – and this will already be the case in June 2010. The outlook of the software giant predicts that people will spend on average 14.2 hours a week online and 11.5 hours a week watching TV.

Although YouTube is ot the easiest site for Google to bring to advertisers minds, it still does some good results – and has increased ad selling from 6 to 9% – in terms of its video views. Nevertheless, revenues are still low – as for all competiors like Hulu or MySpace, said AdAge. Again it shows, content is king from revenue perspectives…

“The gain in YouTube’s U.S. business is the result of a number of factors, including more content agreements with partners such as CBS, MGM and, more recently, Disney, expanding YouTube’s partner program to thousands of indie and small producers and successfully guiding YouTube visitors to content it can sell to advertisers.”

Some fashion spots are just cool… and find a great ending.

Nielsen: Facebook best in reach, MySpace in ads

The recent Nielsen study ‘Global Faces and Networked Plazes‘ focuses on the increase of social networks in terms of worldwide reach and extension. The results emphazise the rise and importance of communities but also the dynamic of the intention to grap more market share.

Talking of reach, Facebook -the worldwide leader in the social network market- is showing the strongest user base and has replaced MySpace as the world’s most popular social network. Classmates comes in third, followed by Orkut and LinkedIn. The reasons for the facebook success are obvious. According to the study and Nielsen measurement, the win of the Facebook tactic is based on the ‘simple design, broad demographic appeal and a focus on connecting’.

Reports estimate that in 2008 Facebook earned around $US300 million in ad revenue compared to around $US1 billion for MySpace. If Facebook has made a conscious choice to go for the quantity vs. quality strategy it has yet to overtake MySpace in the all-important revenue metric.

So, monetization is still not Facebook best business activity. MySpace attracts more advertisers and gets twice as much campaigns than the ‘Zuckerberg team’.
The Nielsen view on the reasons is that “MySpace’s offering possibly makes its inventory – of which there is a lot more compared to Facebook – easier to monetize, particularly in terms of immersive advertising.”

Finally important, the use of social networks has outdated email as the first way of online communication: 67% of the users show a regular activity in communities.

Safer Internet: Social Networks want to protect children

Let’s hope this was kind of a historical day, yesterday… The day against ‘Cyber-Mobbing’ was called the Safer Internet Day. One reason why 18 companies signed a new kind of declaration of a self-imposed obligation named the Safer Social Networking Principles for the EU contract.

In order to prevent the misuse of new technologies companies go hand-in-hand on their social networking future. Probably, much appreciated from parents is that big social networks have signed the agreement, i.e. MySpace, Facebook, Habbo or Bebo – but also Google and Yahoo belong to the group of signatories.

Spot On!
Children and young people face many risks with new technologies: i.e. cyber-bullying, grooming, privacy violation or exposure to harmful content (pornography, racism, etc). The contract is like a company-grouped agreement to protect young people online more than European legislation already does. As a dad of two kids I definitely appreciate the effort and will keep an eye on it.

The Social Globe – social networks become paid-content

The challenge for social media will remain to find ways to monetize platforms best way. Now, facing Twitter, Facebook, MySpace, LinkedIn, or any other social- or business network there is probably nothing shorter than their best practice list on monetizing social media business. Still there is banner-, text- or link advertising as the prominent revenue stream. Nobody really finds the right turn for a profitable and successful revenue model.

Now, let’s take a wild ‘think-tank’ approach… Is a business model like the ‘Pay-Per-X’ Murdoch TV business models (i.e. Sky TV) a solution? A company which ties together or combines social networks to a bundle and offers those on a paid subscription basis?

When we started silicon nearly a decade ago as a closed b2b IT community (see picture), social media and web 2.0 did not even have a name or definition. In those days we thought about offering silicon as a paid subscriber community for IT and business decision makers. Obviously the idea was to make our investors and share holders happy ‘asap’ by monetizing the business modell best way. But web days were too young for such an approach, paid content was seen as ‘boo’ and we were fighting against old media that gave ad space away for free in order to save their ‘powerful-print-publisher-position’ in the market. Paid content models were not embraced with open arms by (business) user. The appearance of an evangelist was even worse in the user’s eye. Today every adolescent knows about online communities and their use is paid for by parents. They are about to accepted spending money with their credit card for their children networking.

Surprisingly enough, most of the leading social and business networks as well as any other communities don’t want to touch the monetizing issue ‘premium-subscriber’ or ‘paid communities’. In the past as well as today it is the art of financing social- and business networks not only by revenue streams coming from the classical (banner-) advertising or cpx model because for social networks as well as for any other business counts: profit is a liability. A critical business model is, if users just love but are not willing to pay for it. Nevertheless, investors and the providers need to re-finance the business and ideally make it profitable. Altruism is nice but in our modern common era it does not exist anymore, and in business never did.

So, what if social media platforms were only offered as a subscription model? Let’s give the responsible company the title: The Social Globe. The business area of this company would be defined with the following definition…

The Social Globe is the leading pay-social-media company. The business segment of The Social Globe relies on the credo that pay-social-networks can only be successful as a broad offer of high-quality and exclusive community content. Social networks on subscription basis is the main business of The Social Globe. Furthermore, The Social Globe offers its subscribers an attractive value of business communities, corporate networks, micro-blogging services and so on with the option to subscribe to single- as well as pay-per-use services. The company carries the open networking, markets the lineup of all social networks and provides a world-class service around the planet.

Facebook Connect could be the door opener for this kind of open marketing via The Social Globe for the users (and also solve some security issues). Whoever wants to use social networks in the future has to pay a certain mite per month and intensity of use. These subscriber packages are targeted to business or private user or as topic packages – nice portions with attractive subscription offers and reasonable offers, or as single use offers. Would the users pay one to ten EURO if the social or business network is useful for them? Probably…

If providers and investors of social media platforms want to see reasonable profits they need to make their users pay for the quality platforms they get offered – on a long-tail view, advertising and co-operations are too heavily depending on global and regional fluctuations of marketing budgets and the world-wide economic situation. If the financial situation for social media remains as it is today, a positive view of the future will be a distant prospect. XING did it right when taking 5 EURO from their premium-users – but no other social network seems to be following. OK, XING wanted money from their users from the very start… a clever move!

Nevertheless, other social networks do have to follow if they don’t want to run out of money and face a ‘internet-crash-reloaded’. A big user and interest database -and most of the social networks are nothing more and nothing less in most cases- is nice to have but somebody has to pay for the efforts the providers are offering. Otherwise these business models are worthless, or let’s say, not really of value.

The saying “Free things always hurt!” has it’s rights. The power user will be paying, the ‘normal user’ needs to be made visible that there is a surplus value in social networks. Then this user will be paying as well – or this person will not be of real value for providing the platform. And if ‘word-of-mouth’ marketing works, then friends and peers will be getting this normal user to pay who once unsubscribed as of financial reasons. As this person will not be able to follow the offline conversation if he is not part of the online community. These people will become unpopular, or not…?

Spot On!
The surplus value of a subscriber model for social media platforms is huge and the ‘funding’ as well as the ‘revenue increase’ as well. What value do 140 million users have if the business model will not be flying in the sense of incoming revenues. If The Social Globe just turns 30% of the users of this social network to paid users the providers have 40 mio. EURO more to elaborate an even more powerful platform. Ad and newsletter formats would continue to serve as additional revenue streams but not as the only and leading ones. The Social Globe could tie all together and split revenues according to traffic.

Just utopia or is ‘The Social Globe’ a viable vision?

The Social Globe: Social Media als bezahlter Abo-Dienst?

Auch wenn wir jetzt eine aussagekräftige Studie zu Erfolgsfaktoren in Social Networks haben, bleibt das Thema Monetarisierung von Social Media weiterhin ein schwieriges Businessthema. Egal ob Twitter, Facebook, MySpace, LinkedIn, StudiVZ oder welches Social- oder Business Netzwerk auch immer – so richtig hat noch niemand den Dreh für eine erfolgreiche Monetarisierung der Social Media Modelle gefunden. Nun wollen wir mal einen ‘wilden’ Denkanstoß wagen: Ist ein Modell à la Premiere, Kabel Deutschland oder Sky TV auch für die Social Media Welt in Form einer Netzwerk-Betreiber-Gesellschaft denkbar, die Social Media Abo-Dienste bündelt und anbietet?

Als wir mit silicon.de (damals eine geschlossene B2B-IT Community – siehe Bild) vor acht Jahren an den Start gingen, hatte Social Media und Web 2.0 noch nicht einmal einen Namen. Wir haben damals über ein kostenpflichtiges Angebot für IT-Professionals und Business-Entscheider nachgedacht, um die Monetarisierung im Sinne der Shareholder anzukurbeln. Damals wäre ein solcher Vorschlag undenkbar gewesen (Evangelist hin oder her) und die technischen Voraussetzungen hätten die Maßnahmen nicht erlaubt. Heute kennt und nutzt jeder Halbwüchsige Communities und die Bezahlung für Mehrwertdienste in Kinder-Communities ist teilweise schon im Vorschulalter durch die Eltern akzeptiert.

Dennoch machen die meisten führenden Social- und Business Networks sowie Communities noch keine Anstalten über eine Abo-Monetarisierung nachzudenken. Die Kunst und die Kür für Social- und als Business Netzwerk Plattform damals wie heute ist, sich als Businessmodelle erfolgreich nicht nur über ‘Werbe Revenue-Streams’ zu finanzieren. Denn auch für Social Media gilt: Profitabilität ist die Pflicht. Was die User nur gut aber nicht bezahlenswert finden, muss sich dennoch für Investoren und die Betreiber refinanzieren- und idealerweise ‘profitabilisieren. Nästenliebe gibt es in der modernen Zeitrechnung der Wirtschaft nicht mehr, und gab es früher auch nicht.

Was wäre also, wenn man die Social Media Plattformen als Abo-Dienst anbieten würde? Nennen wir die verantwortliche Firma mal: The Social Globe. Das Geschäftsfeld des Unternehmens würde sich dann vielleicht so lesen…

“The Social Globe ist das führende Pay-Social Media-Unternehmen. Das Geschäftsmodell von The Social Globe beruht auf der Überzeugung, daß Pay-Social Networks nur als breit gefächertes Angebot aus hochwertigen und exklusiven Communityinhalten erfolgreich ist. Social Networks zum Abonnieren ist dabei das Kerngeschäft von The Social Globe. Zusätzlich bietet das Unternehmen seinen Abonnenten attraktive Business-Communities, Social Communities, Corporate Networks, Micro-Blogging Dienste mit der Option zur Einzelbestellung im Pay-per-Use-Verfahren auf Abruf an. Das Unternehmen betreibt die offene Vernetzung, vermarktet die Palette aller Social Networks und sorgt für einen umfassenden Service rund um die Welt von Social Media.”

Facebook Connect liefert die Vorlage für die offene Vermarktung durch The Social Globe an die Kunden. Wer zukünftig die Plattformen nutzen will, zahlt einen Obolus pro Plattform und Nutzungsintensität. Diese Abo-Pakete sind für Businessuser und Privatpersonen ausgerichtet oder eben als Kombipaket – schön portioniert mit attraktive Abonnements zu sinnvollen Angeboten oder eben als Einzelangebot nutzbar. Für ein bis zu zehn EUR pro Plattform im Monat zahlen die User bestimmt, wenn das Social- oder Business Network für den User einen wahren Nutzen hat. Oder nicht…?

Wollen die Anbieter und Investoren von Social Media Plattformen irgendwann mal mit einem vernünftigen Gewinn dastehen, müssen sie den User an das Bezahlen gewöhnen – nur Werbung und Kooperationen ist langfristig immer wieder zu starken Schwankungen der globalen sowie regionalen Marketingbudget-Zuteilung in Unternehmen und der generellen Wirtschaftslage ausgesetzt. Eine positive Zukunftsaussicht bleibt so für Communitybetreiber in weiter Ferne. XING hat es richtig vorgemacht, aber irgendwie zieht keiner nach. OK, XING hat es von Anfang an gemacht, ein weiser Schachzug…!

Andere Social Media Anbieter müssen dennoch nachziehen, wenn das Geld irgendwann nicht ausgehen soll. Eine große User- und Interessen-Datenbank -und mehr ist eine Social Media Plattform heute in den meisten Fällen nicht- ist schön, aber es muss auch jemand dafür zahlen wollen, sonst ist sie wertlos bzw. nur bedingt wertvoll.

Der Satz ‘Was nichts kostet, ist nichts Wert’ hat schon sein Berechtigung. Der Poweruser wird zahlen, dem ‘normalen Nutzer’ muss der Mehrwert nahegebracht werden. Dann zahlt auch dieser… und sonst ist er auch nichts wert für die Plattform. Und wenn ‘Word-Of-Mouth’ Marketing funktioniert, werden die Freunde, Bekannten oder Peers denjenigen schon zum Zahlen bewegen, der mal aus den Networks ausgetreten ist aus finanziellem Grund. Denn irgendwann wird derjenige in der Offline-Community nicht mehr mitreden können.

Spot On!
Der Mehrwert eines ‘bezahlten Abo-Dienstes’ für die Social Media Plattformanbieter wäre immens und die Finanzierung der Plattform sowie die Umsatzsteigerung ebenso. Und was nützen 140 Mio User, die die Kuh nicht zum Fliegen bringen? Zahlt The Social Globe nur einen EURO pro User an eine Social Media Plattform aus, so wären das bei 30% Powerusern über 40 Mio. EURO Mehrumsatz. Banner- und Newsletterformate würden weiterhin als klassische Umsatzquelle dienen und ebenso vermarktet werden durch The Social Globe.

Alles Utopie oder ist die Vision ‘The Social Globe’ denkbar?

News Update – Best of the Day

– Die Telekom hat große Pläne im Internet nach Angaben von Ralf Bauer, Senior Vice President Portal der Deutschen Telekom. Gemäß des Sponsorings der Fussball-Bundesliga will man auch im Internet stärker am Ball bleiben. fussball.de soll die führende ‘Kicker’-Seite in Deutschland werden. Die Vergleichswerte: kicker.de 170 Mio. Page Impressions (laut IVW-Online) – fussball.de 114 Mio. Page Impressions (laut Vermarkter Interactive Media). Das nennt man ein Challenge! Kachelmann soll es übrigens mit seinem Meteomedia AG als Wetterdienst bringen und ein noch nicht benanntes Frauen Web-Magazin wird gelauncht.

– Sind Social Networks auch zukünftig reine Kommunikationstools zu sehen? Werbefreie Zonen wie die Inbox? Laut einer IDC Studie ist dies vorerst zu befürchten. In den USA nutzen 75% der User mindestens einmal in der Woche und 57% täglich Social Networks. Dort verweilen dann 61% pro Session rund 30 Minuten. Eine lange Zeit…, in der aber nur 57% auf die Werbeelemente klicken – im Vergleich zu 79% aller Internet Konsumenten. Sieht so aus, als ob Social Networks sich langsam neue Monetarisierungsideen überlegen müssen, wie Sie Geld machen wollen. Ideen gibt es hier (für Facebook und Myspace) und hier (Twitter) ja schon. Sonst muß man weiterhin live zusehen, wie Mitarbeiter bei Twitter entlassen werden…

– Wikis in Unternehmen bündeln und fassen Firmenwissen an zentraler Stelle allen dafür vorgesehenen Mitarbeitern zugänglich zusammen. Sie vereinfachen die Arbeitsprozesse, die auf Projektmanagement und Collaboration basieren – intern wie extern. Alexandra Graßler wurde zum Thema Wikis in Unternehmen informiert und verweist auf einen interessanten Artikel.