"According to VentureOne, a research firm, nearly $500 million in venture- capital money was pumped into social-media companies in the first nine months of 2006. [...] As in the last bubble, sites blossom out of nowhere and quickly fade. The average user of Xanga, the buzzy social-networking site of the early Aughts, spent 15 minutes on the site in December, down from around an hour and a half in October 2002. Friendster, the massively VC-funded social-networking service whose demise is being hurried along by the more free-wheeling MySpace, topped three hours per user last February, only to drop to a quarter hour in December."Right. Well, I suppose that does it then.
Problem is, the rest of the piece is more or less opinion based around the author's observations of a select number of web sites.
I love The Atlantic, but it's really very conservative on new media.
These earlier social media sites, like Friendster and even Myspace, are, I think, too narrowly focused on specific types of functionality, eg.: video sharing, bookmarking links, sharing music, photos, blogs, and customising RSS feeds into a personal page. The "whatever" features Hirschorn refers to.
And they often have a pretty horrid user experience, or the set up process is incredibly complicated. That's no problem for the teenage, geeky types, or the older long time web user, but it's not very attractive to the general user.
So in broadening out the application of social media the user experience needs to become simpler, more mainstream, if you like. And the offering needs to become more practical. Which it inevitably will. In other words there needs to be a good mix of useful functionality and meaningful community interaction, with professionally produced content alongside user generated content. As this happens the use of social media sites will expand, not contract.
In commercial terms, all of this needs to be underpinned by an opportunity to transact. Users need to be able to easily evaluate and ultimately purchase the products advertised within that social space.
The three elements are:
- Content - professional and user generated
- Community and interactivity - honest engagement and real, practical functionality
- Commerce, or transactions - the next gen social media site enables a market place for commercial clients to connect directly with users.
Another aspect of the current social media hype is non-related businesses thinking they can get on the bandwagon. Hirschorn refers to Doc Marten's new social networking site Freedm2.com. That strategy didn't work for Walmart. And I suspect it won't work for others like Nike, either, despite their CEO's confidence at the recent WEF. Nike as a social networking community just doesn't do it for me.
It all seems a bit narrow. Sure, it's a good thing that companies want to engage more with their customers, but I don't think it that has to be, or even can be, via a social networking strategy.
You have to approach these things as publishing ventures, not just add-ons to existing businesses. They need to operate successfully in their own right, and users are pretty good at sniffing out frauds.
The key as far as timing goes, is the commodification of technology, the boom in web based applications, and the rise in online populations via broadband uptake and better awareness of the web and the concurrent migration in advertising dollars. These are significant differences from the situation in the lead up to April 2000.