According to Spencer Ante (It’s Official: U.S. Social Networking Sites See Slow Down) the social networking market is slowing down. One interesting fact presented by Mr. Ante is that although membership numbers on particular sites like Facebook are up, engagement numbers are down– way down. But isn’t it about time that we see this trend downward? I mean we’ve all witnessed Social Networking 1.0– we’ve beaten that dead horse. And if we aren’t absolutely inundated by peopleglut and infoglut within the social networks, then we simply become bored and return to our real lives. What’s left to keep us engaged? There just isn’t a very compelling reason.
The problem with the majority of today’s social networks is that they are purposeless and irrelevant. They experience social and information entropy as they grow. They become irrelevant and noisy. As it goes, once the novelty of a social site wears off, the community or herd migrates. It started in 1999 with a little startup called Ryze. Ryze didn’t have a lot to offer in the beginning. As soon as Friendster hit the radar the herd migrated. After finding Friendster to be appallingly slow and problematic they migrated to MySpace. Today the herd continues to migrate to Facebook, but they’re looking… looking for new digs where they can move their social equity.
Purpose Driven Social Networking
The following is a list of types or classifications of community that when applied to social networking can create or drive purpose:
- Communities of Action– a community where its members have the possibility of bringing about change
- Communities of Circumstance– a community based on life experience or the situation a member is currently in
- Communities of Interest– a community where its members share a common interest or passion
- Communities of Position– a community built around life stages that provide individuals with the opportunity to build relationships with others during that particular phase of their lives
- Communities of Practice– a community made up of people who have common goals who interact to share experiences, lessons learned, new techniques, and information as they strive towards those goals
- Communities of Purpose– a community made up of people who are going through the same process or are trying to achieve a similar objective. For example a community of people working to make a difference in the world, where mission matters as much as the bottom line.
- Community of Inquiry– a community based on questioning, reasoning, connecting, deliberating, challenging, and developing problem-solving techniques, especially in the context of education
One social network in particular that stands as an example of purpose driven social networking is LinkedIn. A business-oriented social networking site, LinkedIn was launched from Silicon Valley in May 2003 by Reid Hoffman. Used for professional networking, LinkedIn generates a degree of continuous value as it not only keeps the member abreast of changes in their professional network, but in their professional market. Unlike Facebook and MySpace who have seen a dramatic drop in engagement, LinkedIn members stay engaged because it becomes an integral part of career exposure, promotion, and management. There’s value in staying connected to and being exposed in your professional network. But still, LinkedIn falls short in the area of driving continuous value to the individual member. Every time I go to LinkedIn it’s the same-old same-old. And although LinkedIn remains interesting to me, it’s most likely because it started here in Silicon Valley and therefore (still) has relevance.My biggest fear is that it’s going to go the route of so many other social sites and become convoluted as it continues to grow. My fear is that it will lose its relevance to me.
So why doesn’t LinkedIn serve me better? Why doesn’t LinkedIn try to keep itself relevant to me (beyond my network connections). I mean, it knows a LOT about me. It knows my entire career, it knows who I’m connected to, it knows how often I visit, it knows what I look at most often. So why doesn’t it serve me continuously while I’m engaged to keep me coming back? Why doesn’t it extend far beyond network connectivity to find interesting matches for me, in both information and people?
Relevance, Purpose, and that which matters most…
Social networks, in order to be successful and monetizable must drive continuous value to their stakeholders, through relevance and purpose. There simply needs to be a reason to go there and spend your time on a daily basis, and it has to extend beyond fun and games. And we have to move beyond siloing (the creation of purpose or relevance through vertical and/or private label social networks attached to brands and already existing groups and organizations). Siloing does create a particular degree of community-based relevance, but in itself does not serve the individual’s needs. In order toachieve the desired levels of engagement and participation v.Next Social Networks must understand the user and what and who is relevant to that individual user at any moment in time.
The question has been raised… “Is the party over?” The allure of social networking may be waning, but it’s far from over. Social networking is in its infancy. The Web was originally designed to do one thing really well… ‘connect people.’ This point was driven home when my company launched Match.com back in the mid-1990′s (we became very good at connecting people through the web). The time is ripe for the next innovator to steal the social networking market, like Google did back when they stole a supposedly saturated search engine market– and monetized it.
Social Networking v.Next must be focused on intelligence. It must continuously learn about and serve its membership, individually. It must be about things finding you rather than you finding them– about driving individual value, continuously. With so many social networking sites that end up as little more than vanity mouthpieces, it would be refreshing to see the emergence of those that serve real purpose and continuously drive individual value.
I really need to preface v.Next with a little background. How did I get into this whole high tech thing anyway? It all started in 1980. There I was, at Illinois State University sitting in my apartment. I saw an ad in a magazine for a personal computer based on the new 8080a chipset, 16K of memory, and included the basic programming language. WOW! I cut out the order form, dropped it in the mail and anxiously waited for my shiny new computer to arrive. A couple of weeks later I was completely hooked. This was definitely the wave of the future! After a few weeks of fiddling around my craving for more far exceeded what my little mail order computer could provide. I found myself driving 40 miles away to Peoria, Illinois where I found one of the very first Apple II computers for sale. Virtually every day I was engrossed… my appetite for more grew with each passing day. I signed up for a microcomputer class on campus and hooked up with a classmate by the name of Jim Kohs to see what we could cook up. We came up with the name Microlab, got a business license, and printed up some business cards. While doing laundry at a local laundromat, Jim put a business card up on the cork board. I chuckled and told Jim that he had wasted a perfectly good business card. The very next day we received a call from an Executive from Country Companies Insurance in Bloomington, Illinois. It turned out that his washing machine had broken down and he was in the laundromat doing his laundry. The next thing we knew we were writing and distributing software for practically every Country Companies insurance agent for the state of Illinois. Unfortunately my new business took so much time away from my studies that I had to extend my stay for an entire year to graduate. Over the next 3 years Jim moved to Texas. I took the business forward by creating a company called Interdac Computer. I expanded beyond programming services to include entire computing solutions for various vertical markets. My medical vertical became so lucrative that I closed Interdac and started Medcom, a company focused entirely on the development of medical software. My first program was called Antibiotic Utilization Review (AUR) which was sold to Eli Lilly in Indianapolis. Eli Lilly distributed AUR to virtually every hospital in the United States. I then went forward with my next major piece of software called IV Manufacturing. While completing my second product offering I was offered a chance to move to Silicon Valley, to be a part of an incredible startup that was going to revolutionize communications across the world– Tsunami Technologies. Although my business was booming, I couldn’t turn down such an opportunity. I sold my business and moved to San Jose, CA.
Tsunami Technologies was the first company I worked at in Silicon Valley. We were building the future– a broadband network that would simultaneously carry voice, data and video, something we refer to today as hybrid fiber coax or more commonly cable modems. You know that little box you get from the cable provider for high speed internet? In 1986 we were demonstrating a complete solution in a box that would deliver it all. The work was tough as technology was a bit more primitive than it is today– and we actually had to create just about everything– hardware, drivers, protocols. Today we take the layers forgranted. Everything below the application layer is simply a blackbox– somebody else’s problem. Back then there were no black boxes. Memory, processor speed, latency– it all mattered and it was tight. But we did it.
After a few years of very hard work and going public I decided to leave and join Sun Microsystems. While at Sun a friend of mine, Jordan Graham and I started a little company called Bioaccess. I had come up with this idea to mount a miniature thumbprint scanner on a gun so that only the owner could fire the weapon. As we zipped along toward demonstrating our idea we quickly discovered that the barriers to entry (NRA, Consumer Protection Agency, etc.) were just to high. And even though we could achieve accuracy of 99.99%, the risk of a false positive or false negative reading were far too high. Jordan went on to become the CEO of a little startup called Electric Classifieds and started soliciting me to be his Vice President of Engineering. I was perfectly content at Sun and didn’t want to leave– but the pressure mounted and the offer and opportunity was too lucrative to pass. In 1995, only one year after joining Sun Microsystems I became the first Vice President of Engineering at Electric Classifieds, Inc. the first company to bring classified ads to the internet. In order to demonstrate just how great our classified advertising engine was, Gary Kremen, the founder of ECI decided to launch a proof-of-concept, a branded personals category called Match.com. Match quickly grew by leaps and bounds– outpacing the operational gear we were running it on. We had to move fast to get our servers out of the basement at ECI and into a new professional hosting facility at a little startup called Exodus Communications. Like ECI and everyone else at that time, Exodus was experiencing growing pains. Growth at Exodus was outpacing the amount of real estate they had to offer. Exodus was building out facilities as fast as they possibly could. During my first year at ECI the CEO and I went on a roadshow to push our classified advertising engine to some of the biggest media companies in the country, including Time Warner, Atlanta Journal Constitution, Toronto Star, Washington Post, Disney Interactive, Microsoft, AOL, Compuserve, Cox Interactive, etc. What we discovered from our interactions were that our little demonstration of a single classified category, personals, was where the business was at. What we didn’t realize at that time was that this was one of the early social networks that would demonstrate the power of connecting people through the Internet. Unfortunately our board of directors didn’t share that same vision and believed that the classified advertising engine was the future. The board sold Match.com to Cendant Corporation for $7 million in 1998 as a means to fund the continued development of the classified advertising engine. One year later Electric Classifieds went bankrupt. The original founder, Gary Kremen realized a whopping $50K from the creation and launch of Match.com, one of the Internet’s most successful services to date.
In early 1997 my father was diagnosed with a terminal illness. I left Match.com to be with him during his last three months. Regardless of the outcome of Electric Classifieds, I was smack in the vortex of where and when it was all happening… in one of the earliest social networking plays in Internet history– I was hooked.
My passion was and always has been about leading people, and creating and promoting great product. In 1999 I was handed an opportunity to consult for a couple of very large venture capital firms (and a few smaller ones as well)– Chase H&Q and Warburg Pincus. My job was to travel around the country performing technology diligence, turnaround and M&A work on pre-investment and portfolio companies. I can’t even begin to tell you what an incredible experience this was. I was visiting the hottest (as well as the ‘nottest’) internet ventures in the market, meeting with the founders and teams, and either helping determine their ability to be funded, or to help accelerate and/or fix their business. The money and notoriety was beyond what I could have imagined. And during this period I was able to step back and visualize just where everything was headed, both from a marketing stance as well as a technology stance. It was obvious that the market’s immense growth rate was going to spin down at some point… and 9/11 pretty much sealed that fate, both for startups as well as my consulting engagements. But beyond the pain of a decimated web marketplace, something far more important came out of this period… a return to the ‘roots’ of the Internet… what it was originally designed for… for connecting people. Sure, it’s a fantastic information tool, but beyond the information component, the one thing the market had lost its way on was exactly what the web did best– connect people– but in a different way than the business of dating. Social networking was right there, right in front of our noses.
In 1998-1999 I had been attending these little parties in the South of Market (San Francisco) called the Web of Finance. A friend of mine, Adrian Scott would host these little parties from his live-work loft. You’d find all types of young entrepreneurs wandering through his flat, talking about this idea and that… but the one I remember most was Adrian talking about his social networking idea called Ryze (http://www.ryze.com). Ryze was truly the first of its kind, incorporating the concept of a user profile with the ability to peruse members of a site, post your picture, communicate with others, and form groups. WOW! So far before its time. I noticed that when Ryze first launched it was fantastic. All of my friends were there and we were having a blast. And then it happened. The network started growing by leaps and bounds. Who were all of these people and where did they come from? So many groups, so much information. Some of the people I enjoyed meeting, but there were a whole lot of others I really didn’t want to meet. Social entropy had set in. And as other social networks emerged, once again social entropy occurred. Until finally LinkedIn launched. Social entropy had seemingly been curbed with LinkedIn. Social networking with a purpose– interesting concept. Hmmm…
This all set me on a mission… how to control infoglut and peopleglut (aka spam) to generate (at least) a sense of value… how to create relevance in the belly of social networking and social media… a seemingly endless journey that to this day continues to consume me. Nothing gets me going more than finishing and promoting a product and hearing a customer say, “You created that? That product rocks!” Admittedly I have a passion for social networking and trends in the social media market.
This blog is primarily about product and interactive marketing insight and perspective. My passion is centered on building and promoting product and brand– on driving user adoption and achieving product and market-share and revenue nirvana.
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