Social Networks continue to show a strong future of growth.

Two recent Forrester reports published by my colleagues, Josh Bernoff and Oliver Young, both showing the future of social computing for the interactive marketer and for enterprise 2.0 purchasing. A very obvious trend for both of these reports is the growth of budgets by marketers and companies for social networks.

I’m not releasing any new information here, but just highlighting the public data that they both point out:

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Social technology marketers bullish in face of recession

We polled interactive marketers with the following question: “Assuming that the economy is in a recession in the next six months, how would you change your Investments in the following marketing channels?” Over 40% of them indicated that they will increase spending on social networks even in face of a recession during the next 6 months.

Josh writes: “Social networks will get the largest number of increases, over 40% of those using it, along with user-generated content, blogs, and that old standby, email marketing.”

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Forecast: Global Enterprise Web 2.0 Spend By Technology, 2007 To 2013

In Oliver Young’s report on Global Enterprise Web 2.0 Market Forecast: 2007 To 2013, or read the blog post, and the graph has been published on Read Write Web and ZDnet, Enterprise spending of social computing software (internal and external) his report provided some clear forecasts demonstrating that purchasing in social networking software (like this white label list) will increase, and take the largest segment of the budget.

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Your internal discussion
You should forward these stats to the web strategy teams within your company, and start a discussion answering each of the following questions:

Is your organization of what social networks are (believe me, many aren’t)?

Are you aware of why social networks are so important (talk about trust)?

Is your marketplace using social networks? if so, which ones?

What are you competitors or others in your industry going?

What are people doing in social networking sites in our marketplace?

That’s just the exploratory questions you’ll need to answer, there’s a much large discussion you’ll need to have, after the awareness questions are answered.

I’ve published quite a few posts on social networks, view archives.

11 comments

I’m respecting your limited time by publishing this weekly digest on the Social Networking space, which I cover as an analyst.

I’ve created a new category called Digest (view archives). Start with the Web Strategy Summary, then quickly scan the succinct and categorized headlines, read text for my analysis, and click link to dive in for more.

You can subscribe to this digest tag only, which filters only these posts tagged digest.

Need to make decisions about your web strategy? I’m here to help: subscribe to my blog, sign up for emails (right nav), or follow me on Twitter.

Web Strategy Summary
Culture continues to be impacted by social networks, more real world case studies emerge and adoption continues to rise. Watch OpenSocial as more containers (social networks) adopt the protocol and widgets will spread in an easier method.

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Guide: Picking a Community Partner
A great practical guide on how to select a white label social network or community vendor.

Web Usage UK: 25% of 8-11 year olds on Social Networks
The trend continues on as social networks become a major form of communication for our next generation. It really seems as if the adoption of social networks is happening at a faster rate than nearly all other forms of communication.

Jobs: Facebook ad Career Builder partner
Facebook to now received Career Builder job modules to help it’s highly educated member based to benefit from job listings. Expect to see job posting widgets appear from competitors.

Art: Social Network Visualized
Social networks visualized in this fascinating graph where members relationships are seen.

Trend: Real time chat to be new Social Networking feature
Expect to see more containers –and vendors –offering chat features for social networks, expect attention rates to increase on social networks as members communicate longer periods of time.

Culture, woman murdered over Facebook usage
This sad article depicts a father angry over a daughter’s Facebook usage in a conservative culture.

Segmentation: Social Networking for Small Businesses
Great to see Rodney Rumford featured in this recent article from Forbes discussing how small businesses connect using social networks.

Container: Hi5 launches widget platform
In the next container to launch it’s widget container for opensocial applications, Hi5 now opens it’s doors. Hi5 has a launch program with restrictions on how much an app can distract the user experience.

Verticals: More music artists launch social networks
A great opportunity for the white label social networking industry to grow communities for fans including Kylie Minogue, and 50 Cent.

Leave a comment if there’s a story I missed.

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This is entirely speculative post, as I don’t have access to US Government databases, yet the concept worth thinking about. I certainly don’t know the answer, and posed the question to my twitter community with a variety of responses, there wasn’t a clear agreeing side.

Government Data
The US Government has a wealth of demographic, workplace, educational, and financial information about it’s citizens, I’m sure there are other databases collecting information. Yet when I think about the information being created by ourselves on the social database (myspace, facebook, blogs) only a portion of the above data may be found, but an entirely different set of information can be found.

Social Database
Our research indicates that a majority of teens in North America are using social networks, in fact more than 2/3rds are active monthly users, and about 1/5th are daily users. We’re all aware of the stories of how teens are using these tools to communicate as their primary forms above phone, and even email.

Types of information commonly found in the Social Database of Gen Y:

Demographics
When I take a look at a few of my younger friends I see they’ve uploaded (willingly) information about their: age, sexual preference, political stance, work, school, email address, IM clients, phone numbers

Pschographics
They also share some of of their psyhographics: what they like, what motivates or saddens them, hobbies, music. With some time, you could eventually interept their profile to find some inner drivers and motivations. Status messages can really be telling, it’s obvious to me when someone is going through relationship pains.

Technographics
While not as complete as formal research, they also share their technographics (how they use technology) by looking at their activity, mini-news feed, see what type of applications they’ve downloaded and used. Beyond web use, you may see elements of consumption of cell phone, tv, and other technolgies present.

Relationship Network
Perhaps most importantly, they share their network information, you can see who has become their friends, what they think of each other (top friend apps) and eventually find nodes, influencers, and sneezers.

Privacy
Although much of this profile information is hidden, privacy continues to be a top concern, yet many of those afflicted with information sharing in a way they weren’t expecting have to always remember they were the ones who put that information out there in the first place. Even if someone decides to delete a profile, they comments, applications on third party sites, will leave a residual ghost that may be impossible to erase.

Considerations
Generation Y (and everyone else) should have a mental filter in their mind before publishing anything on the web. One should assume that this information (or pics) should be considered public, seen by those you don’t want to see, and here forever. While this may not always be the case, it’s a good filter to have.

10 comments

I’m respecting your limited time by publishing this weekly digest on the Social Networking space, which I cover as an analyst.

I’ve created a new category called Digest (view archives). Start with the Web Strategy Summary, then quickly scan the succinct and categorized headlines, read text for my analysis, and click link to dive in for more.

You can subscribe to this digest tag only, which filters only these posts tagged digest.

Need to make decisions about your web strategy? I’m here to help: subscribe to my blog, sign up for emails (right nav), or follow me on Twitter, (I’ll follow you in return).

Web Strategy Summary
This week is slow, as my host Dreamhost has been down. Updating this draft post has been difficult. The most significant news is Yahoo joining the OpenSocial alliance. Expect to see more social networks and widget creators focusing on building OpenSocial compliant applications.

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OpenSocial: Yahoo steps into the fold
In a not so surprising move, Yahoo joins the OpenSocial collective, and a non-profit organization is formed.

Market: VCs: “No More Social Networks”
I have to agree with this, I can’t stomach another social networking pitch either. We need to stop deploying the same tools and figure out what really matters: how to communicate and be part of communities.

Privacy: How to use Facebook’s Privacy Features (video)
Teresa did a great video on how to use the privacy features on Facebook. Well done.

Widget: Mytopia launches pan networks
This widget game creator is launching several widgets on multiple platforms without being OpenSocial compliant. Unlike OpenSocial the games work across the different social networks, not as individual installs or instances.

Profile: Widget creator slide profilled
Money magazine dives into the world of slide and interviews Max Levchin. With a large inventory, and disappointment with advertising on social network sites, can Max’s ‘engagement’ metrics be they key?

Money: Hong Kong Investor pours more into Facebook
Li, a HK investor continues to put more cash into Facebook: “Li had previously invested US$60 million for 0.4% of Facebook. Li didn’t specify Thursday how much of a stake he now owns in Facebook”

This digest is a bit thin compared to previous weeks, so please leave a comment if there was something relevant that was missed.

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Many corporations are outsourcing their community platforms
I’ve been talking to more and more companies that are creating their own corporate communities around their brand. For the most part, they lean on the SaaS models that the white label social network, collaboration, or even insight community vendors provide. While it certainly makes sense for marketers to lean on application service providers (it’s all setup, ready to roll, without the hassle of dealing with internal IT) and a decent to moderate price.

Avoid vendor lock in: own your data
One thing that I think is worth mentioning is that customers of these software providers need to protect themselves against vendor lock in, and the best way to do this is to make sure you own your data. The data is the ethos and soul of your community, it’s all the profile content, interaction content, uploaded media, and discussions.

Good for the industry
I’m hearing that most vendors have a clause that says that the client owns the data, but when you look deeper there may be vague descriptions or time limitations –which could really muck things up if a client wants to pull out.

Now why is this important for customers? It keeps them empowered to take their data and switch providers in the rare case a social networking vendor isn’t providing the right service or support.

What’s in it for community software vendors? It holds them at task to make sure they grow, take care of customer needs, and ensure that the relationship –and product roadmap continues to improve.

What should you own?
Customers should be able to pull their data (all of it) at any time with no questions asked, for a period as long as the forum has continued, or to receive periodical backups and exports perhaps monthly or longer. They should be able to get it at will, with no questions or withholdings by the vendor. If someone has a clause that has been written that meets these objectives, please leave a comment below, I’m no lawyer, so I won’t be creating the specific agreement content –but I know what it should meet.

Concerns and considerations
Of course, by owning the data doesn’t necessarily mean that you can quickly switch vendors, as the data will often be structured differently quite a bit of massaging from experts will need to occur, but you can sleep better at night knowing your more in control of what really matters –the ethos of the community.

If you’re a client (or vendor) in this situation, I’d like to hear about what policy you’ve all agreed upon.

Update: In one case, one client sent me an example of a vendor only offering the last 30 days of archived content. Only after they discussed it further with the vendor that they received the details. Vendors need to be more upfront about what this actually means.

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Situation
The market pressure to create technology products that protect or at least damage their impact to the environment continues to grow. Sustainability and green-tech campaigns are coming from nearly every tech company –esp hardware manufactures. Dell is no exception and launches this Regeneration campaign.

[Dell Leaned on an Active Artist Community In Facebook to Create, Vote, Self-Regulate what it “Means to be Green” Regeneration Campaign]

Goals
I’ve not spoken with the Dell marketing team, but it’s pretty obvious this is a campaign helps to help improve Dell products to be more eco-friendly, and of course, spur affinity torwards the brand from green leaning consumers, the ReGeneration site has more details.

Strategy
Dell Computers, along with Federated Media (A social media marketing agency), and Graffiti Wall (A popular self-expression Facebook application), deployed an interactive marketing campaign that encouraged existing Graffiti artists to be involved in a contest that spurred a member created campaign resulting in affinity towards Dell. The artists were encouraged to ‘own’ the message, their creativity would spur a contest, and would continue to fuel the campaign.

Tactics
I was briefed by James Gross, who shares his thoughts mid-flight, a Director at Federated Media, as well as CEO John Battelle (interview), and they explained the contest to me.

1) Existing application with thriving community

Graffiti is a self-expression application in Facebook. It has popular (rated 4 out of 5 stars) Based on 242 reviews, and has 177,506 daily active users. Rather than creating a new application, this campaign took advantage of an application –and community–that already existed.

2) An art contest: What does Green mean to you?

Facebook members who used Graffiti were encouraged to join in a contest to win a 22″ environmentally friendly Dell monitor (appropriate for artists) to create art around the theme of “What does Green mean to you?” The contest lasted for one week

3) Engaged contributors spur theme
Over 7000 pieces of artwork were created and submitted to the contest. If you watch the replay of the art being created, you’ll see hidden messages (like easter eggs) from the artists as they discuss what green means to them. Many of the drawings had the Dell logo or the regeneration logo embedded in it. The Regeneration microsite promotes a few contributors.

4) Self Regulation
There were few negative pics that would detract from the campaign, as the community of existing artists will self-regulate and vote off pics that were not appropriate.

5) Community Voting and Winners Announced

Voting began on the second week by the members and over one million votes were cast. The winners were from United States, Canada, Sweden and Maldives. You can see the actual winners here, or click image.

Results
The campaign was a success, thousands of engaged members participated, created the campaign on behalf of Dell (similar to the Chevy Tahoe campaign a few years ago), and the community was rewarded. I don’t know for sure, but I’ll guess the majority of the campaign dollars were spent creating the microsite, then hiring FM, and working with Graffiti. The monitors, were likely less than a $1000 each.

Over 7300 Graffitis created from Jan. 16th-Jan 23rd around the theme of “What Does Green Mean to You”
Over 1150 fans of the contest

Over 1,000,000 votes were logged from Jan. 26th-Jan.31st for the artwork. (Here are the Top 150 based on votes)

Over 1,000 ideas have now been submitted over at ReGeneration.org

209 comments to the post at ReGeneration.org

Over 197 blog mentions in Technorati

What could have been better
When it comes to social media, the mentality of short lived campaigns should go away. Communities existed before a brand reaches to them and after the campaign stops. Marketers should plan for long term engagements with these people, rather than short two week spurts. There was clearly traction here and now’s the time to step on the gas and continue forward.

Secondly, the artwork created by the winners (and runner ups) should be included in future products, such as digital wallpapers, in the primary branding for Dell, and even the artists should be given an option to continue as sponsored artists. With the relationship forming, take it to the next level. Encourage artwork to be part of next generation green computers, with proceeds going to non-profits or back to the artists to continue forth.

Thirdly, the campaign was limited to Facebook, which isn’t the extent of artists on the web, as well as limited to other social networks such as Bebo or MySpace where similar communities can be found. The contest should have been created not just within the walls of a closed gardens, but also spread to the open web.

Summary
Unlike most marketing campaigns that deploy heavy ads, fake viral videos, or message bombardment, this campaign let go to gain more. Overall, this is a successful campaign as they turned the action over to the community, let them take charge, decide on the winners, all under the context of the regeneration campaign. The campaign moved the active community from Facebook closer to the branded Microsite, closer to the corporate website, migrating users in an opt-in manner that lead to hundreds of comments was clever. Well done.

Articles and Related Case Studies

Article: Virtual art for the natural world

MediaPost Social Media Insider: Maybe Advertising In Social Media Should Be An Oxymoron

LA Times: Web Scout: Spinning through online entertainment and connected culture

Case Study: How Sony connected with the Vampires Application

Case Study: Facebook Sponsored Group Analysis: Target vs Wal-Mart

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Teresa Valdez Klein (Blog, Twitter, Facebook) delivers a great how to video, describing ‘how to use Facebook’s privacy features’. Apparently, the controls are non-intuitive and requires someone from the community to walk through it.

This is an important feature, especially for my three younger kid sisters who are mainly used to sharing their lives online –two of which don’t realize the impact it will have on their professional lives as they get older. (and unwanted attention)

I’m sending them this video, along with encouragement to protect themselves, I encourage you to send this to your Generation Y family members and friends.

They should:

-Create permission groups, one for family, ‘real’ friends, online acquittance, classmates, and colleagues
-Personal pics, content, involving parties, unruly or sensual photos should only be seen by those who were present (often friends)
-Be careful about the content that is left on wallposts, it’s not an IM tool, and should be used as a public blog, this area is very telling of what someone does offline.
-Remember that college and company recruiters now look at social networking sites to see what you’re made out of, so if you’ve not received that phonecall back, this could be one of the reasons.

Related Posts

-”I only use email to communicate with old people”
- Crises Management Template: Child Relations for Social Networks (Facebook)

1 comment

I’m respecting your limited time by publishing this weekly digest on the Social Networking space, which I cover as an analyst.

I’ve created a new category called Digest (view archives). Start with the Web Strategy Summary, then quickly scan the succinct and categorized headlines, read text for my analysis, and click link to dive in for more.

You can subscribe to this digest tag only, which filters only these posts tagged digest.

Need to make decisions about your web strategy? I’m here to help: subscribe to my blog, sign up for emails (right nav), or follow me on Twitter, (I’ll follow you in return).

Web Strategy Summary
Bebo acquired by AOL, a major consolidation in the industry, with both companies have strong media plays, and may have reach for familiar demographics, this could be a partnership made in heaven. Facebook continues to sport new features, and society continues to be impacted from the adoption of social networks

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Acquisition: AOL buys Bebo for $850
The largest news for the week is AOL’s surprise move to purchase 3rd ranked social network Bebo for $850 million. At first glance, the demographics line up well for both parties, yet it’s unclear what their media strategy will be for this experiential social network.

Acquisition: Demand Media Buys Pluck
I’m a few weeks late on this (I’m not sure how it slipped by me) but Demand media has decided to buy Pluck.

Debate: Up with Widgets, Down With Widgets
Interesting counter viewpoints here, this article on why widgets are a success barely alludes to the opportunities, and this counterpoint says why widgets won’t work.

OpenSocial: MySpace rolls out OpenSocial Library
The OpenSocial protocol is now starting to grow as MySpace launches it’s library of OpenSocial apps.

OpenSocial: Hi5 to launch developer platform
Like Facebook and MySpace, Hi5 is next to announce that they will allow applications to quickly and freely move from one social network to the next.

Privacy: Infamous Dupre tries to control MySpace profile
Dupre, who was pointed out in the prostitution scandal had her Facebook and Myspace page scoured by press, she tried to control but too little, too late.

Politics: Election battle fought on Facebook
CNN reports that the campaign could be fought –and won — on Facebook for the next president of the United States.

Analysis: Linkedin and Xing
RWW does some analysis by the numbers comparing the two business social networks, Xing and LinkedIn. Although Xing has a smaller user base, the attention data is much higher.

Culture: Will members outgrow embarrassing photos?
Facebook, which was intended to be a social hangout for college students has now grown to be much more than that, as business and family personas creep in. How will users react?

Findings: Social Network users consume media
Highlights from a recent digital entertainment survey show that “27% of respondents say that social networks could become the main way they access music and video content”

Growth: Ning exceeds 200,000 networks
Semi-white label social network Ning sports growth as over 200k communities have been created. Of course, that’s a non-stat if the active user base is low, apparently 70% of them are active, but how do you count this? one user visiting?

Usage: Facebook traffic to Eclipse MySpace
While never the sole attribute we should measure success on, total traffic to MySpace reduces yet attention data increases, with the opposite happening for Facebook.

Features: Privacy and IM to be added to Facebook
Facebook continues to ratchet down constraints to improve the experience at Facebook with a new IM feature that will be interested to see how it takes hold.

Leave a comment if you’ve any suggestions, or I missed any stories.

6 comments

I’m respecting your limited time by publishing this weekly digest on the Social Networking space, which I cover as an analyst.

I’ve created a new category called Digest (view archives). Start with the Web Strategy Summary, then quickly scan the succinct and categorized headlines, read text for my analysis, and click link to dive in for more.

You can subscribe to this digest tag only, which filters only these posts tagged digest.

Need to make decisions about your web strategy? I’m here to help: subscribe to my blog, sign up for emails (right nav), or follow me on Twitter, (I’ll follow you in return).

Web Strategy Summary
The possible intent for Yahoo to Join OpenSocial (Google’s alliance to allow widgets to freely travel between social networks) is expected. This is an industry shift, and we should be watching –and adapting– to this. Compete shares top visited social networks, where MySpace and Facebook continue to dominate, and growth spurts from smaller players like Myyearbook are good to watch.

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OpenSocial: Yahoo could Join
I’m confident this would be a smart move for Yahoo, this is something they should take seriously. Yahoo to join OpenSocial. The only player that’s not going to be part of OpenSocial out of the large organic networks will be Facebook. But since they’re sharing a seamless transition with Bebo (who’s part of OpenSocial) it could now be a forced hand for them.

Usage: Social Network Visits, Feb 2007 vs 2008
Compete graphs the top visited websites, MySpace and Facebook continue to dominate, although Myyearbook makes quick gains.

Evolution: REM sells next album on iLike
The Might Be Giants was the first to sell their albums on MP3 in the 98 or 99, Pearly Jam in 2007, Radiohead in 2007, and now REM sells their album on iLike.

Whitepaper: Increasing the Density of Connections to Power Business Performance
SelectMinds, who has made some recent announcements of funding and new products is offering a white paper on how businesses can improve by enabling employees to connect.

Deployment: Awareness power travel social network
Awareness, announced that its Enterprise Social Media platform is powering GlobalTravelBlog.com, a community where travelers can share their experiences and connect with each other.

Analysis: Performance of Widgets
Interesting graphs and analysis on how many applications are growing –then ‘epic’ failing– through loss of usage and user interaction.

Interview: Zuckerberg on the future of Facebook
This short interview, which starts with the recruitment of the newest COO sheds light on the direction –and lack of– that Facebook is headed. One thing is clear, cocktail parties are serious social networking events here in Silicon Valley.

Acquisition: Pluck acquired for $75m by Demand Media
Demand Media has purchase Pluck, the “social media platform provider to high profile clients including USA Today, The Washington Post, and Fox News.” reports MashableChris in last week’s digest)

Features: Newsgator powers Sharepoint to go ’social’
Newsgator, with strength in embeds now is going to empower Microsoft’s sharepoint to have social networking features, enabling it’s strong CMS and collaboartion tools to let members connect and share.

Schools: Don’t get Facebook/Real World
The education system appears (at least in this case) appears to be completely withdrawn from the fact the real world is about collaboration, and it often happens online. This student, who lead group collaboration has charges brought against him, as he created a virtual study group. On the other hand, maybe this was an individual assignment, and he didn’t follow orders.

Drama: Zuckerburg Interview takes a very wrong turn
Facebook’s founder and CEO Mark Zuckerburg experiences a very awkward interview, too many opinions to point to, just see techememe.

Expansion: YouTube extends, Kickapps hosts
YouTube announced that it would let it’s player be more of an embedded application. Kickapps is the first to let the experience be available from it’s own social networking platform.

If I’ve missed anything, leave a comment or send me an email for the next digest.

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Thanks to Kevin Werbach who invited me to lead a roundtable at Wharton West (yes, the business school) in San Francisco last night. The topic, “Social Graph for Fun and Profit” was intended to let the attendees engage, shout, argue, and come to agreement on how we can address this new world. If you’re not familiar with the social graph, here’s how I explain the social graph to executives.

I agree with Kevin, there are so many ideas, not everyone agrees with everything. Present were many CEOs, VCs, Analyst, Entrepreneurs, Googlers, Bloggers, Consultants, and quite a few folks from Adaptive Path.

Elliott Ng attended my session, and shared his viewpoints on how the future will be amorphous, layered, interconnected, and fragmented. Rene Blodgett, who loved my clothing choices for the evening, also shared that we’re having a shift with the Advertising & Marketing Sea Change. Ted Shelton posts that his favorite comment was Advertising is transactional. Brian Solis took some great event photos (I’ll add more to this link list as they emerge)

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In my session (there were two) I lead the discussion around three topic areas, and asked the attendees to give their opinions, we worked together and answered the following questions:

How can the Social Graph by “leveraged” to increase member attraction?
The audience said:

Clean up experience.

Email inbox is shifting to SoNet Inbox.

Members “punish” spammy app devs.

Niches are ok, segmentation better than mass.

Need to prevent site becoming ‘over popular’ so it doesn’t dilute.

Improved Infrastructure (API/Standards/DP)

Option for a premium service sans advertisements

Make ads part of the social experience

Members can define the ads they want (see blyk, which gets good CTR)

Teens may be a fickle audience

How can Social Networks monetize?
The audience said:

Challenging, if it becomes like ‘air’ (like consumer email)

Point: the tertiary parties around the social network will monetize

LinkedIn is a utility, the value add is more than pure social networking

Different ways to monetize:

Advertising

Download media sales

Subscription

Premium Services

eCommerce

Market Research

Specialized Content (Tiered content “NIN”)

Value added services for niche audiences

Marketing Services

Infrastructure (B2B)

What is the future of social networks?
The good people said:

A few big players “the highlander” or

Will be many small niche contents

Digital Lifestyle Aggregation

Focus on ‘people’ –not so much content

Teens drive adoption

Geography and culture shapes communities

Social circles (a different type of culture) shapes communities

Device Dependent Social Networks (mobile cultures adopt differently)

Device “in”-dependent as well.

Aggregated Social Networks with control will occur

If you want to learn more about Forrester’s perspective on the future of social networks, read Charlene’s master post on how Social Networks will be like air.

Conclusion:
We certainly did not solve any industry problems, but plastered quite a few options folks should be thinking about. Not everyone agreed on every topic, so it was a very active ‘live wiki’ type of event.

Thanks Kevin and Wharton for hosting a great event.

1 comment

I’m respecting your limited time by publishing this weekly digest on the Social Networking space, which I cover as an analyst.

I’ve created a new category called Digest (peruse archives). Start with the Web Strategy Summary, then quickly scan the succinct and categorized headlines, read text for my analysis, and click link to dive in for more.

You can subscribe to this digest tag only, which filters only these posts tagged digest.

Need to make decisions about your web strategy? I’m here to help: subscribe to my blog, sign up for emails (right nav), or follow me on Twitter, (I’ll follow you in return).

Web Strategy Summary
We’re starting to see more consolidation of the White Label Social Networking space, and it’s probably a good thing for the overall market. Mzinga acquires Prospero, and I think this will be the first of other companies coming together.

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M&A: Mzinga Acquire Prospero
Mark at Techcrunch gets the story about Mzinga increasing it’s stature by this recent acquisition of Prospero, my thoughts are on the TC site.

Executive: New COO for Facebook
Facebook continues to attract top talent, Kara Swisher breaks the news that Facebook’s new COO is Google’s Sheryl Sandberg.

Content: MySpace launches Hidden Camera Reality Show
This non-scripted reality hidden camera show called Special Delivery (in association with Avalon TV) was launched on MySpace TV.

Global: Facebook translated to German by Users
Facebook recently translated it’s site to Spanish (with mixed reviews) and is now letting it’s user and member base translate to German, in fact over 2000 members will crowdsource this site.

Widgets: How brands are getting in on the action
BusinessWeek shows how A&E gets in on the widget craze by creating an interactive game.

Segmentation: Social Network for Infants “TotSpot”
Niche coverage for nearly every interest, demographic, or focus continues as “TotSpot” gets coverage. This social network, aimed at infants gives them a way to network (well their parents at least) before they can even type.

Community: Fanista launches a media based community
Fanista, self-described as “a community-powered marketplace for entertainment enthusiasts that offers a whole new way to discover and shop for music, movies, games and books” we see yet another online community launched. Expect this to be in similar market area as MySpace and Bebo.

NewsFeed: Facebook opens Newsfeed to 3rd parties
Facebook has allowed third party web sites to signal changes to member news pages, (of course in opt in) but Sean from RWW does some analysis and suggests they didn’t’ allow for enough access to the those developers.

Usage: Bill Gates ditches Facebook, joins LinkedIn
This probably makes a lot of sense for what Bill’s trying to accomplish as he’s now joined LinkedIn, where he can connect with other business and political figures.

Community: How to build one
Francine Hardaway gives some examples of companies and organizations that have built some communities, see this extensive list.

Analytics: The team at ‘Developer Analytics’ brings new measurement
Measurement is key, it drives marketing and advertising spend. The Developer Analytics team launches new features to help developers measure their widget growth and campaigns.

Limitations: Clamps on invites for Facebook Developers
I’m conflicted on this one, but the less invites may drag down growth for Facebook developers, but I’m sure it could increase the user experience.

Normalization: Social Network feature spread to Wikis
Jimmy Wales new project, Wikia launches social networking suite that invades the white label social networking space.

If it’s not apparent to you yet, I cover this space as an Analyst, this really helps me (and everyone else) stay on top of what’s important.

Let me know if I’ve missed anything, leave a comment, or submit to me over email, see my contact page.

6 comments

Live notes as I sit in the front row at Graphing Social Platform.

Web Strategy Summary
MySpace continues to beckon to developers to build widgets and applications on their social networks. They are friendly to industry-wide specs such as OpenSocial and are putting efforts to protect privacy, and uphold security. Despite this welcoming to developers, constraints are set in place to protect the user experience as well as provide incentive for developers to create thriving applications. A balance will need to be found to appease MySpace, Users, Developers, and eventually new marketers. If you’re seeking more on widgets, please visit all posts tagged widgets.

Current Status
Current apps (as of today) are limited to 5 users, and is not full rolled out.

Revenue Opportunities
Developers will be able to create their own self revenue opportunities through canvas pages. The more money the developers can make on their own, or using MySpace’s Hypertargging ad network will be the monetization process.

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Raw Notes from Jim’s Presentation below

EcoSystem History

-My Space users have been using applications for years, such as YouTube, Photobucket, slide, and RockYou for over 3 years.
-This provides creative opportunities
-Encourages self-expression
-and offers customization
-Overall, beneficial to users, develops and the MySpace ecosystem as a whole

MySpace Developer Platform API

-1) OpenSocial API is the first AI, Javascript and Myspace Specific Extentions
-2) REST APIs (server to server) and Oauth authentication (open standard for data portability)
-3) Action Script APIs: Flash support (although silverlight can access it’s REST APIs, they haven’t decided if they want to create a sliverlight app)

OpenSocial

-Why open social?
-Commitment to Open Standards
-Good for the internet as a whole (users to platforms)
-Portability: developers can spend time building apps, rather than rebuidling every social network
-Leverages other existing web technologies, no need to learn proprietary development languages.
-Also by keeping platforms open give opportunity for a larger eco-system from Users, Developers and Platforms

-Working closely with Google to drive the spec, and are currently supporting Version .6 and will move to .7 soon
-Myspace Specific extensions includes: Bulletins, And additional attributes for bands.

Platform Surfaces

-Profile Surface
-Canvas Surface
-User Homepage Surface: Powerful user specific surface, enables to show specific data to a user that might be relevant on a users profile
-For example: an eBay application that would track your individual bids, would be readily available on homepage.
-For example: or see ‘my’ twitter profiles of my updates, but on my profile page could be visible for everyone
-Summary: This creates a ‘homepage portal’ for users.

Security, Privacy, and Safety

-Have created internal filters and protections (they wont give details) to protect users
-Applications go through safety review process
-Apps will be governed by the same privacy controls that are in place for members
-Apps will never have access to information that cannot be found on any members profile page
-Have 100 employees reviewing code, images, and content being uploaded every day.

Balancing Virility and User Experience.

-Developers are incented to create applications to grow, but creating apps with little levels of utility may not be beneficial to long term eco-system
-Artificial spammy growth is not necessary.
-Initial apps will be able to innitiate the workflow for sending a message on a 1 to 1 basis.

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Many interactive marketers and web strategists are unsure of what to do, either to create a campaign on existing social networks (like Facebook, MySpace or Bebo) or to create their own branded social network around or on their corporate website.

Charlene’s keynote yesterday outlined that in 5-10 years that Social Networking will be like “Air” (in the most ubiquitous sense) it currently isn’t present in every aspect of the web, for now, it remains fragmented, separated, and sparse. The industry still wrestles with the options.

I perform the initial phases research on the open wide web (it helps me to get a broad sample of ideas), and also dove in with social media experts as we debated, argued, and even podcasted the concept.

The camps have for the most part, been split. But based upon the calls I’m having with clients, there will be an increase in community spending on social networks, or for companies to create their own. Companies like Dell, Microsoft, Intel, Carnival Cruise Lines, and Wal-Mart have already launched theirs.

A few weeks ago, I published the Forrester Report Online Community Best Practices, it was the first on a two part series, it’s focus, which taught interactive marketers (and web strategists) the processes, roles, and ideology that 17 other companies had success with. Unlike blog posts, real research requires sources other than my own thoughts, of course it’s cemented together through a Forrester methodology, peer collaboraiton, and a very, very intensive editing process.

In this second of two report entitled: Online Communities: Build Or Join? Objectives Should Drive Community Strategy And Technology Decisions. The report gives specific answers after a plan and strategy has been drawn. If you’re a client, you already have access to view the report, or you can purchase it directly from the site, read about your options.

So what should a marketer do? It really depends on your objectives. We’ve found there are five major objectives found in any social computing effort: Listening, Talking, Energizing, Supporting, and Embracing, John has live blogged from a recent conference what each of those are.

Once you determine your objective, the report clearly outlines on how you should approach the problem, including doing initial analysis at finding out where your community currently exists.

At first, writing such a report was difficult, every business situation was different, so I worked with Charlene, who quickly suggested that it’s not an “or” but a “when”.

Interactive Marketers and Brand Strategists need to know when they should join or build a online community.

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[It’s a perfect day here in San Diego at Graphing Social Patterns, we’re right on the waterfront, but us geeks, well we tweeted, blogged, and talked in a dark room]

Most of the presentations this morning have been very developer focused, I’m covering Graphing Social from the Web Strategists’ perspective: Web decision makers in corporate.

Rodney Rumford gave a Facebook Marketing 101 presentations and explains how businesses can use widgets to reach customers. Facebook gives you multiple ways to reach customers, and with them spending 20 minutes per day, the attention is there.

In the presentation from BJ Fogg who co-ran the Facebook class at Stanford, they developed applications, that they estimated totaled $500,000 in revenue from the students efforts in advertising. They give out a list of learnings on what made them successful, often it included being flexible, quickly iterating, not listening to individual opinions or getting approvals, just launching them, and experimentation. It was very clear to me that that behavior is the opposite of large brands, who want safety, low risk, and pre-written plans.

[Successful applications were experimental, embraced risk, and quickly iterated –everything big brands will struggle with]

Rodney gave the example of the where I’ve been map, and suggested that brand managers should consider sponsoring existing successful apps, rather than create their own. Rodney suggested that advertising rates were disappointing yet, suggested that interactive marketing and social ads gave more opportunity. First, define success, lay out metrics, use a multi-pronged approach (there are many different tools to use).

Rodney suggests that one of the key challenges is with the decision making process:

“Most of the people (at big corporations) who are making the decisions for Facebook are 45 or older, and are not immersed in Facebook”

For success, one should consider: 1) Outsourcing development to those that get it, such as an a successful widget development company, or 2) lean on someone in your own team who really understands this space. While strategy remains, social networking marketing requires a different mindset, approach, and use of tools.

Various pics from the event

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I’ve been tracking with great interest the “White Label” (meaning you can rebrand as your own) Social Networking space with great interest for some time. When I first started the master list, it was at about 20 companies. Now it pushes 70 companies, and even spills over to collaboration and insight lists too.

I’m expected to know this market (it’s in my coverage area as an Analyst) and quite frankly, it’s very, very hard to keep track. I can only imagine how interactive marketers and web strategists feel. In fact, every other day I get an email or comment to message asking me for my opinion.

Today, Mzinga Acquires Prospero, who are both in the space. I actually had Mzinga in my insight community list, and Prospero on my white label list, so if all goes well for them, they have the opportunity to match features up. They aren’t the only ones, last month ONEsite Acquires Social Platform, and you can expect more of this to happen.

I’ve been chatting with Mark Hendrickson of Techcrunch, who’s also on point to watch this vertical, and I shared with him my thoughts on where this industry is headed. Read the interview at More Consolidation in the White Label Social Networking Space: Mzinga Acquires Prospero.

We should expect other players on this space to start consolidating, to strengthen their offerings, increase customer base, reduce overlapping costs, and to prepare to battle as others start to team up.

By the way, in Q2-Q3, I’m slated to do specific research on this market, to segment the market so interactive marketers will be able to make a decision on who to choose. Stay tuned.

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Before you invest time and money in a widget strategy, you better know the challenges. This applies to VCs, Web Strategists, Developers, and even Social network companies

An Objective View
In this blog, I strive to provide a balanced viewpoint of both the benefits and challenges of a web strategy, it’s easy for us to become over-hyped and then fall right into the pit of over exuberance. (See other posts tagged Challenge)

I’m moderating quite a few panels with widget developers (last week at Stanford, next week at Graphing Social, and in a few weeks at Ad:Tech) so I’ll be using many of these challenges to hold the vendors to their claims.

First, a few parameters:
Update: This list of challenges mainly applies to widgets within Social Networks, although many of the challenges afflict mobile, desktop and blog widgets.

Widgets are ‘mini-applications’ that can be embedded on other containers (such as social networks like Facebook, MySpace, Bebo, LinkedIn, and whoever decides to join the movement) The thing is, desktop widgets have been around for some time, so this really isn’t anything new, but for the purpose of this post, I’m just going to keep those on social networks in scope.

In regards to terminology, I’m just going to use widgets as a blanket term to also include “applications” and “canvas pages” terms that developers user on Facebook’s F8 platform. I’ll clarify that on another post in the future.

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The Many Challenges of Widgets:
Each of the following hurdles can be overcome, but first, let’s identify them.

Difficult to Monetize
First and foremost, this has been the biggest challenge. For some widget developers, the money has come from investors or VCs on Sand Hill road. Secondly, I’m hearing that the CPI plague (see below) is becoming more common, and then lastly, advertising is not an effective way to monetize in social networks (read this for more).

Immature Market
Widget developers are mostly experimental, they are throwing gangly Spaghetti, Pasta, Rigatoni, and Jeremici (I just made that up) against the wall to see what will stick. In most cases, most of the half cooked pasta falls down from low users adoption, leaving a sticky residue of messy profile pages.

Overcrowding profile page
Have you seen my profile page on Facebook? It’s a mess, and with so much noise, who can compete? With there being thousands of widgets, only a few can survive on my profile page (I know there is tabbed segmentation) but really, how many do we need?

Low Barriers to Entry
A challenge for every web market, is that there are few ways to differentiate, and it’s easy for a young Russian developer or a Stanford student, or a team of Chinese engineers to quickly get in the game.

Metrics and Analytics Inconsistencies
Hardly anyone is measuring the success of their widgets in the same way, do we measure on install, activity, views, traffic, or clicks? As a result, other than Appsaholic, there’s very few industry ways to measure success.

Spammy
Sadly, I learned from a panel I managed that some of the most successful apps were the one that leaned on the social graph, no not the one that we all dream about, but in the context of email spam. Many containers are clamping down on this, as it’s best to preserve the user experience, but this could continue to be an issue.

Bastardization: Cost per Installation (CPI)
To me, this looks like one of the worst in our industry, to me, this is like ‘printing money’. Did you know some of the top developer companies sell to other developers the chance to let new widgets piggy back off successful ones by promoting them. The developer can then charge for cost per install.

Disposable and low value
Rodney Rumford first mentioned this term to me, he was describing that many widgets are simply not used more than once. These glamor widgets provide one time entertainment, or are used once and never reused –except for removing from ones profile page.

Recycled clones offer little uniqueness
Perhaps the worst plague is the “attack of the clones” in many cases, the code from widgets are created by one developer, stolen (I mean crowdsourced or collaborated) slightly modified or rebranded and then republished.

Low Utility
I’m trying to think of a widget that provides business utility, or one that improves my life other than casual communications or entertainment. Reminiscent of the web in the mid 90s, we’ve yet to see the business value.

Hard to build successfully
Specialized skill set are common among the developers, most traditional interactive firms, and most companies don’t have the skills or experience to create a widget. It’s a different game with a different mindset, the same strategies often don’t apply.

Multiple APIs strain developers
Most platforms or containers are offering their own API, although most are touting they are OpenSocial compliant (as I write this, OpenSocial is not public, it is but in beta but should be soon) yet we’ve got to wonder is it too late for there to be a common industry API if it’s already fragmented? I spoke to the Evangelist of MindKey last night and he suggested that each platform has unique APIs (like news feed APIs) that the other doesn’t share –it’s already fragmented.

Ever changing platform APIs requires attentive team
When I hosted the widget roundtable, it became very clear that the APIs on platforms are quickly changing, and sometimes without notice. For the agile developer company, they’ll be able to quickly morph with their full time resources, but for the Interactive Firm or corporate web team, they’ll likely be too slow.

Pricing may vary, lack of standards
I have the privilege of being one of the few people in the world that gets to talk to the widget developers and find out what they are charging. In many cases they don’t know what to charge (as they have strong technical skills, but are just ramping up on the business side, and they are undercharging) This will clean up this year, and we’ll start to see some benchmarks.

Poor User Experience
Dennis McDonald (via comments) suggests that the usability for widgets is often poor. With there being little standardization on the inteaction design, I’ll agree, he states: “It’s hard enough to keep track of multiple incoming data streams representing different people, sources, relationships, keywords, etc. When you try to cram too much though a widget you have a real usability problem because of the variety.”

Performance Issues
Pravda (via comments) suggests that some widgets have poor performance, and thereby causes a disrupted experience. Since widgets are hosted on third party servers, some laggards can hinder the rest of the social network experience, he states: “This is because they require additional HTTP request, and in some cases, this request delays the rest of the page. This is the reason that I am not using Meebo widget in my blog”

Lack of Brand Control
Len Kendall (via comments) suggests that some brands may be concerned where their sponsored widget may appear. In many traditional advertising deals, Coke will never want it’s advertisement near Pepsi, but with widgets, that’s unavoidable.

Add your own in comments
What other challenges of widgets did I miss? Please leave a comment and credit and link to you.

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Caveat: While I’m highlighting the challenges, it doesn’t mean they can’t be overcome, and it most cases, the value is higher than the challenge. I’m just suggesting, we shouldn’t only look at the beautiful side, but set yourself up for success by knowing what you’re in store for.

I could write a solution or a fix for all of these challenges, but that’s a post for another time, or one I’d be happy to answer for clients.

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I’m respecting your limited time by publishing this weekly summary, read the summary, then quickly scan headlines, read the bullet, then click to learn even more.

I’ve created a category called Digest (you can see archives) where you can start to track and access these going forward. Quickly scan the succinct and categorized headlines, read summary for analysis, and click link to dive in for more. You can subscribe to this digest tag only, which filters only these posts tagged digest.

Need to make decisions about your web strategy? I’m here to help: subscribe to my blog, sign up for emails (right nav), follow me on Twitter, I’ll add you back.

Web Strategy Summary
I was pleased to see that consolidation of the white label industry is already starting, this is needed as there are too many players in the space, expect more consolidations then some major acquisitions later this year. Continued scrutiny over social networking fatigue continues to pound away at Facebook and others, although the social networks are fighting back, and insisting that fatigue is only a temporary dip.

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Adoption: Helpful map shows adoption of SoNets on Earth
Worthy as the first story, this map shows how each social network has dominance in certain geographies, Out of all of those listed, I only did not know 4 of them, I’ll study up for next week. There’s an additional list here sorted by Alexa by country.

Downtime: Bebo has over 12 hours downtime in two months
This is downright embarrassing. 12 hours is barely acceptable in a whole year, let alone Jan-Feb of this year. Other culprits include Microsoft live spaces, Friendster then Hi5. Let’s hope downtime reduces for the rest of the year.

White Label: Acquisition of Social Platform by ONEsite
Expect more acquisitions to occur in this crowded market, Social Platform now mergers under ONEsite. I’m tracking this space closer on this post.

Mobile: Social Network for iPhone
Fon11 is a vendor planning on creating a social network for iPhone users. But why limit this to a particular phone type? Why not extend this to all mobile devices.

Innovation: Facebook allows 3rd parties to update newsfeed
Smart move here by Facebook, allowing it’s lifestyle social network to hook and display other areas of a members life right on it’s newspage. As long as this doesn’t get too spammish, expect this to be a success.

Fatigue: UK Facebook dips?
Facebook, the top social network in UK had a 5% reduction in usage in recent months, and reports from BBC, and techcrunch. Despite these claims, Facebook declares traffic is not dipping.

Fatigue: Piczo sees tough times
Once promising startup Piczo (aimed at teens, girls mainly) is seeing a slowdown in growth, and as a result has had some downsizing and layoffs. Maybe there are too many players in the space, or they didn’t differentiate.

Advertisements: Google to sell ads on YouTube
YouTube, a social network is a Google property that is going to monetize by selling ads, there’s a great opportunity to gain the TV advertising dollars if they can demonstrate success.

User Experience: Facebook ads Flash
With the added ability to add flash applications added to Facebook, an improved experience could result from members watching or interacting using rich media, games, or video.

Sensationalism: Fox blasts Facebook
Fox fires off a hot title to get readers, please friends, no website is going to rule over the other, there are no absolutes, no zero sum game.

User Experience: Design features keep Facebook organized
In an effort to constantly improve it’s clean looking user experience, Facebook is creating a tabbed based experience to organize a members wall, about, and photos section.

If I’ve missed anything, let me know, I’ll be happy to add it to the next digest.

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Are you thinking about building a community on your own domain with one of the 70 white label social networking tools?

Or have you thought about joining an existing community on a social network like Facebook or MySpace?

We thought this heated debate was over, I took heat from Shel Israel and Doc Searls (look at all the trackbacks and comments) for my stance that in some situations, brands should build their own social networks.

Brian Oberkirch fired up a thoughtful post on why he didn’t want to join the Fast Company social network. Ted Shelton of the Conversation Group charged an email to me, and we started a friendly debate, eventually we agreed that an audio podcast would make good discussion over this topic, and we were also joined by Chris Heuer also of the Conversation Group.

Listen into the discussion as we delve into the topic of brands joining and/or building social networks (about 20 minutes MP3)

If this is a topic that intersets you: you either are going to deploy a community strategy, or you’re one of the 70 vendors or work at a social network like Facebook, Bebo, Hi5, Tagged, LinkedIn, Dogster, or MySpace, I have an upcoming research report called “Social Networks: When should brands build and join” that will publish for clients in the near future (it’s just getting the final touches put on it).

And by the way, as many savvy readers have pointed out, the future strategy will more than often be “and”.

(Update: Elizabeth Albrycht extends some thoughtful insight The Question Concerning Social Networks: Existence or Meaning?

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(Me, giving opening remarks, pic from Julio of Oracle)

The VLAB event last night was a success. What’s VLAB? A non-profit group that sponsors ongoing panels and talks around the subject of business and technology at Stanford and co-sponsored with MIT. I met many of the volunteers and organizers, a good group of folks. Thanks for joining the Shaking the Money Tree of Multi-Platform Social Networks hosted by VLAB.

I kicked off the event as the moderator last night, I gave a very short ‘industry level’ discussion about the social networking space and lead with these high level slides. It was followed by a presentation from RockYou, an applications developer network, then Social Media, a “meta” network for developers, then the panel which included, Sourabh Niyogi, Co-Founder & Vice President of Engineering, SocialMedia, Kevin Marks, Developer Advocate, OpenSocial, Jia Shen, Co-Founder & CTO, RockYou, Steve Cohen, Head of Platform, Bebo, and Ken Gullicksen, Managing Partner, Morgenthaler Ventures.

The topic of the evening? Finding monetization in the next phase of widgets being spread on multiple social networks. We were “shaking the money tree” the tree being the social networking space. At the end of the evening, I came to the conclusion the money tree is small, a sapling really, yet on this tree we’re seeing small buds of potential growth. In most cases, the successful applications are self-expression or entertainment, and we’re just starting to see some applications around utility spring forth.

One rule, the money in the social networking space can’t be from acquisitions, it needed to be long term revenues generated from creating value. The event was sold out, (over 350 registered) and folks came out despite the rainstorm and the heavy traffic from the Bill Gates speech next door. The event was video taped, so I’ll point to it once it’s live, hang tight.

In the meantime read what Kevin Marks from Google wrote, he observed that the key take away was to be Organic, not Viral. Shannon expands upon the conversation, and even discusses some of his upcoming projects. Ken Kaplan shares his notes.

For a detailed blow by blow on the event, Lawrence went out of his way (bus trip and all) to attend the event, read his detailed notes. Foldier blogged their thoughts about the event, and think their product will align nicely.

Despite this industry being young and green, spring is right around the corner, expect growth, innovation, and some real business utility to come out of this blossoming tree –we all hope to soon taste some fruit.

(Tagged vlabfeb08. If you blog about the event, leave a comment and I’ll include your link)