About social networks and business models

Speaking at the New York conference in June, Ross Levinsohn, head of Fox Interactive Media, told the audience: “The main share of marketing proposals will be focused more around thematic sections of the portal, such as Books, Comedies, Films, Games, etc. rather than around individual user profiles. The content of the latter is controlled much weaker, and most advertisers express concern about this circumstance. ” “We want market participants to be easier to work with us,” Levinson explained.

I liked how Scott Karp responded to this news: “It sounds more like a promise to isolate advertising away from the main event, as was the case with Bush oppositionists during his election campaign around the country.” Funny. I reacted to the message with similar skepticism, because I believe that traditionalist attitudes may send media experts from FIM (Fox Interactive Media) on the wrong path.

It is already clear that the main problem faced by social networks, trying to commercialize through advertising, is lack of trust. More specifically, advertisers have historically trusted people as consumers, but do not believe in their ability to create a product (concern about “unsupervised content”). In turn, people, having at their disposal the possibilities of interactive, demonstrate increasing distrust of trademark advertising (ad filtering).
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Social networks at the current stage of development are in many ways reminiscent of currencies of economically underdeveloped countries or of politically unstable countries. In such circumstances, the government should do everything possible to create and strengthen trust between citizens and government institutions. In the end, what is money without national trust? Only meaningless, not having any value of paper.

MySpace, as well as other social networks, is experiencing a similar difficulty. Speaking specifically about MySpace , the resource needs to catalyze mutual trust between users and advertisers. A segregation strategy (fencing-in of advertising-safe areas) can satisfy conservative advertisers and even prove profitable at first, but in the long run such actions will actually undermine the viability of the business model itself, further deepening mistrust between users and advertisers. The MySpace portal should start by addressing this problem by taking steps to create a trusting relationship between users and advertisers at a new level.

After such a broad generalizing introduction, I would like to illustrate my own thought and consider some concrete idea as an example. In this case, it does not matter what are the real merits of this idea. The goal is only to clarify what direction I had in mind when I spoke about building confidence.

Imagine this scenario:
Teenager is viewing her profile on MySpace. She notices on the page a new promotional video of the brand Old Navy. But this particular video instantly attracts her attention because someone from her school took part in the shooting. Without hesitation, the girl turns on the play and watches her friend talking and dancing, at the same time demonstrating the new casual line Old Navy Madras. Advertising looks a bit amateur, although everything is done professionally - creating such a mood was part of the creative intention of the advertising agency that carried out the order of Old Navy. While still under the impression of viewing, the girl notices her cousin online (who is attending college) and retells the video she saw. Sister replies that she saw exactly the same movie Old Navy on her profile in MySpace, but only in the main role was a friend from college.

Now let's go back a bit and try to analyze the event described. In a broad sense, this technique is no different from another, very popular in the advertising industry, when an advertiser signs a contract with some superstar (Catherine Zeta-Jones (Catherine Zeta-Jones ) and T-Mobile ) or a famous athlete ( David Beckham ( David Beckham) and Motorola), and he becomes the face of an advertising campaign. To promote a product in mass media, big names are necessary, as the campaign will be effective only if the viewer recognizes the star. However, on social networks, their own micro-celebrities, popular within individual micro-communities, can cope with the task no worse, and in the future even better than the stars, especially if the campaign is original enough, witty and capable of provoking an exchange of opinions.

As for the role of MySpace, the resource is in a unique position, since, having the most complete information about the participants in the database, it is better than anyone else knows the most “brand-looking” users within each micro-network. Thus, MySpace can be an effective talent search agent by aggregating lists of users potentially sought after by advertisers in various categories. The desire to be noticed will actually become an incentive for individual participants to use such means of expression, which, in selecting applicants, would present them in a favorable light. The winners are all parties involved in the process.

The opportunity for advertisers to collaborate with users is a program to build trust between the parties. This trust, multiplied by the number of advertising campaigns and the number of involved users, can later spread to the entire social network in the most natural way for this medium. The fact that this method is absolutely useless and financially ineffective in relation to the media does not mean anything.

It must be remembered that social networks are a new means, a means of self-expression , and, unlike traditional media, the audience here produces the content itself and is the copyright holder itself. The new model requires new rules of the game - for successful advertising, the most important thing is to launch programs that unite users and advertisers, rather than divide and isolate them. If the interests of both parties are observed, trust will arise, and then social networks will be able to offer truly unique opportunities to advertisers - and users.

As in the case of national currencies, trust will provide social networks with conditions for the development of business models that are resistant to depreciation.

Robert Young is a pioneer in many areas of the Internet, he played a significant role in the creation and commercialization of the world's first Internet provider, aimed at the mass consumer. Participated in the development of pay-per-click advertising, free e-mail and the principle of superdistribution (“free copying” of digital information).