22 posts tagged “marketing”

Tomorrow marks the 1 year anniversary of the publication of one of my most popular posts to date: "Using Social Media to Sell Products to Kids...Interesting but Potentially Dangerous."  In that post, I talk at length about how toy manufacturer Ganz is using the internet and social networking principles to market and promote its very popular Webkinz toys to 6-11 year old children.  I expressed concern that the FTC and Children's Online Privacy Protection Act (COPPA) aren't enough to protect kids:

Companies are marketing to children, soliciting information from them on-line, and asking them to read legal agreements, which are beyond their level of comprehension.  It is difficult for parents to watch out for their kids in situations like this.  If a kid thinks it is okay to input their information onto, say, the Webkinz’s site without parental permission, what is to say that same child won’t think it is just as okay to give that information to a stranger via another website?  Nothing, unless their parents are involved.

In response to that article, I've gotten dozens of emails and a handful of comments from parents, internet professionals, teachers, and others, all of whom agreed with the concerns I raised.  I was also pinged by a nationally syndicated TV morning show who was thinking of doing a story on the topic.  And despite all of this 'concern', in February of last year, The Toy Industry Association awarded Webkinz the "Specialty Toy of the Year 2007," and Webkinz and Lil'Kinz (another Ganz toy) are still hugely popular (and now collectible).  In fact, as recently as January 8, 2008, a retired Webkinz "Cheeky Dog" sold on eBay for $735!

Today, I received a "comment" on my original post from a divorced dad of four who expressed concern that his ex-wife is using Webkinz to "babysit" their eight year old.  "Hank," who works with computers and the internet for a living, defines his eight year old as a "Webkinz Addict."  His son has lost interest in "normal" kid activities (Boy Scouts, Little League, etc.) in favor of playing entirely with his 55 Webkinz toys, a trend which is "encouraged" by his mother:

This past Christmas, [my ex-wife] "promoted" that all should buy a specific Webkin to assure no duplicates! In gross dollars, the child received over $700 worth of Webkins, less than $40 worth of other toys and less than $50 worth of clothing!

How does Hank know how much his eight year old's other presents cost?  It sounds like Hank was the only family member that bought his son something besides Webkinz for Christmas.  I encourage you to read Hank's comment in its entirety. It's both frightening and sad.  It also re-emphasizes the importance of good parenting and the need for every parent to understand the potential dangers of the internet and toys that encourage their young kids to use it.

Hank's comment also re-emphasized my believe that the Children's Online Privacy Protection Act (COPPA) doesn't do enough to protect young kids whose parents don't know how to protect them from the internet.  It's easy enough to point the finger at parents to say that they're at fault for exposing their kids to the net, but it's also not entirely fair.  Most parents don't understand the dangers of the internet as well as they should, and the landscape is constantly evolving, which makes it hard for them to 'keep up'.  Most parents think that the 'danger' is in their kids stumbling across porn or sexual predators on-line, but internet marketing should be a concern as well, especially since children under 13 are extremely vulnerable to suggestion. 

The Webkinz website describes the toys as:

lovable plush pets that each come with a unique Secret Code. With it, you enter Webkinz World where you care for your virtual pet, answer trivia, earn KinzCash, and play the best kids games on the net!

Parents must see the Webkinz marketing copy and think they're getting their kids a great educational toy.  And yet, after listening to the explanatory 'tour' on the Webkinz site, I can't help but think that that the Webkinz proposition encourages an unhealthy level of consumerism and the kind of compulsive behavior exhibited in gambling and/or shopping addiction. 

Kids are encouraged to make "Kinz Cash" by playing games in an 'arcade' and entering 'contests'. They can use this cash to 'decorate' their Webkinz's virtual room. If they don't take care of their Webkinz by going back to the site ton a daily basis, the "health" of the Webkinz will deteriorate. Kids are encouraged to 'chat' with their real-life friends' Webkinz on the forum and to buy more Webkinz so that they can have more fun on the site ("Collect them all!" says the tour).  Given what a time suck the Webkinz site appears to be, I can't imagine any parent having enough hours in a day to supervise their child 100% of the time on the site and still have the child complete all of the tasks/ things that there are to do on Webkinz.  More likely, parents are, as Hank describes it, using Webkinz's website as a babysitter, while they do other things around the house, assuming that the site is an 'educational' tool and perfectly harmless to their child's well being.

Looking at the list of symptoms for "Pathological Gambling" as defined by the American Psychiatric Association (APA) in conjunction with listening to the 'sales pitch' on the Webkinz site, I can't help but think that would be easy for a child to develop a Webkinz addiction like the one Hank described.  The APA says that having 5 or more of the following symptoms constitutes having a gambling problem:

• Preoccupation with gambling-related thoughts, plans or activities;
• Needing to gamble with increased sums to produce the desired excitement;
• Restlessness or irritability when attempting to cut down or stop gambling;
• Gambling to escape from problems or relieve an undesired mood such as helplessness, guilt, anxiety or depression;
• After losing money gambling, often returning to try to win it back (chasing losses);
• Lying to conceal gambling activities or consequences;
• Committing illegal acts to finance gambling;
• Jeopardizing or losing a significant relationship, job, educational or career opportunity because of gambling;
• Relying on a “bailout” (money from others to relieve a desperate gambling-related financial situation);
• Having made repeated unsuccessful attempts to control, cut back or stop gambling.

By supplying a unique cocktail of arcade games, necessary dependency on the site (your Webkinz will suffer if you don't take care of it daily by visiting the website), and ways to earn and spend cash, I wonder if the Webkinz site and product philosophy have the potential to encourage a child (like Hank's son) to rack up 5 or more of the above symptoms (or variations of them).  I don't have the same concern for 13 year old + focused social sites like Facebook and MySpace because:

• A user's online experience doesn't deteriorate if s/he doesn't check into the site on a daily basis.
• Users aren't required to earn money in a fake currency to purchase things on the site (though apps like AceBucks give users the option of earning/spending fake currency).
• The point of these sites isn't to play games (though users can do that). It's to stay in touch with friends.
• These sites are "free" and supported by advertising, which I'd hope 13+ year olds have at least some cognitive ability to filter.

(Though, there are other potential hazards for 13-18 year olds on some social networking sites.)

Thinking about WebKinz reminds me of the Joe Camel debate of the early 90s*  Just because something looks like it should be for kids, doesn't mean that it's good for kids.  In the constantly evolving world of social media and online marketing, it's tough for the average parent to tell the difference.  There's a fine line between teaching kids about the internet in a safe way, coddling them/ being over-protective, and exposing them to things online that could be harmful.  I'd love to hear what a child psychologist with a strong knowledge of web 2.0 thinks about Webkinz.

*According to Wikipedia: "Joe Camel was a controversial cartoon camel that primarily appeared in advertisements for Camel, but also appeared on "Camel Cash" and a number of origami Pop-up print ads. Joe Camel came under scrutiny as some considered use of the character to be advertising directed at children."

Today, on Webpronews, Steven Bradley addresses some interesting questions raised in a couple of other blogs - namely:

• Is there an optimal post length?
• Will shorter posts help to retain readers and even lead to more links?
• What makes you unsubscribe from a blog’s RSS feed?

Bradley’s ultimate conclusion is that the best blogs have a mix of long, medium, and short posts.  He’d “prefer to focus on quality and let the length of the post be what it is… to find [his] blogging voice than consciously attempt to stifle it.”

I struggle with the same questions when writing my own blog.  Plenty of my readers tell me that they appreciate my more in-depth (translation: really long) posts.  But, I seem to get just as many comments (if not more) on short posts as I do on long posts.  Bradley’s blog made me realize that we still have a lot to learn about social media and web 2.0 optimization:

• What are the best ways for companies to engage customers through social media?
• How should individual bloggers and social media mavens (i.e. those who set up social networks/ groups on sites like Ning, Vox, Gather, etc.) structure their content to best engage with their peers around areas of mutual interest?

There are certainly a lot of assumptions to test.  So far, it seems that marketers and bloggers are throwing ideas against the wall and seeing what sticks. In time, there will more scientific ways to answer these questions.  Marketers are only beginning to understand the "science" behind web 2.0, social media, and targeted delivery of information to customers.  As web 2.0 and social media evolve, there is a growing buzz about:

• Search Engine Optimization (SEO),
• Social Media Optimization (SMO), and
• Website Analytics/ Testing/ Website Optimization, which includes things like A/B Split Testing and Multivariate Promotion Testing, Targeted Content Delivery based on the profile of a specific visitor, Landing Page Optimization, and Predictive Delivery / Cross Selling, etc.  

These three topics are closely intertwined...  When a company spends money on SEO to ensure that their websites and/or corporate blogs/ social media properties are well placed in search results pages, their efforts won't result in customer conversion if the person who lands on their site can’t immediately find relevant information they’re looking for.  Similarly, if corporations are writing blogs that are too long or too short for their desired audience, they’ll lose that audience.  With that in mind, I think that concept testing, website optimization and analytics are the key to answering the key questions about the value of social media.  These topics will be of growing importance in the coming years as marketers strive to better understand and target customers to capture greater returns on web-based investments.

There are a some interesting players in the testing and optimization spaces (Offermatica - which, in the interests of full blogging disclosure, is a company that I recently interviewed with; Optimost; Touch Clarity, which was recently purchased by Omniture; Kefta; to some extent Google; and others).  If you are a marketer with experience working the products/services of any of these (and similar) companies, I'd love to hear your thoughts on their usefulness.  In my opinion, web marketers are only just starting to realize the value of testing and web optimization.  It will be very interesting to watch this space as web 2.0 and social media continue to grow. 

If you're interested in web optimization and testing, the following are links to blogs that you might like: Optimize & Prophesize, This Site Is Dead, Out of My Gord, Thinking Aloud. 

Today, I read an interesting article on Pocket-Lint, which summarizes a recent Harris Poll, which questioned 2,309 people back in December 2006:

Of all frequent YouTube users, two-thirds (66%) claim they are sacrificing other activities when on YouTube. Although their visits to the site are most likely to have been at the expense of visiting other websites (36%), time spent watching TV is next most likely to have taken a hit (32%). YouTube also cuts into email and other online social networking (20%), work/homework (19%), playing video games (15%), watching DVD(s) (12%) and even spending time with friends and family in person (12%).

According to the article, 3/4 of respondents would be less likely to visit YouTube.com if ads were placed in front of videos.  Interestingly though, that same group of respondents, was okay about TV network websites airing commercials during on-line showing of television shows.  Almost as many adults (41%) have watched a video on a TV network website as they have on YouTube (42%).

Pocket-Lint takes a unnecessarily negative view of what these survey results mean for Google's monetization of YouTube, saying: "It seems like TV networks can get away with advertising more easily." I don't think this is necessarily true, and I take a much more positive view of the survey results than Pocket-Lint.  While additional research would be required to confirm my thoughts, I suspect that people are more willing to see ads on material that cost money for networks/studios to produce because there is a high likelihood that this content will be entertaining vs. seeing ads on material that had little production cost and may or may not actually be entertaining. 

The thing with home videos on YouTube is that users have to sift through material to find the really funny/ interesting/ good stuff.  That's part of the excitement and charm of the site, but it may also make users reluctant to accept watching ads, if they feel those ads "waste their time."  This isn't to say that users won't accept ads on YouTube, but if YouTube goes, choses to implement ads, to be successful, ads will need to be both relevant to the user and offered in formats that don't annoy users.  Another issue, which I think impacts users willingness to see commercials, is the quality of the picture.  When copyrighted content is illegally posted on YouTube, it is often not very high resolution footage, which impacts the viewing experience.  When a user watches copyrighted content on a network's website, the footage is usually very clear and higher resolution.  I think it goes without saying that if YouTube were able to legally secure content from the content owner (e.g. movie studios/networks), resolution wouldn't be an issue.  But, why would a Studio or Network want to "give" YouTube their content?  I've got a few ideas...

If YouTube users are, as the Harris Poll suggests, really sacrificing time elsewhere in order to spend time on YouTube, there should be plenty of revenue generating opportunities for Google.  First, there are the conventional options worth exploring:

• Conventional Ads -  Additional studies would likely be required to determine what type of ads could be run without causing YouTube user attrition.
  
• It might not be a good idea to put ads ahead of every user-generated video on YouTube, but video ads or splash print ads may be tolerated by users in front of or behind highly ranked home movies or videos that networks and studios post (if YouTube is successful as signing licensing agreements with content owners). 
  
• Targeted banner ads on Youtube.com, or short video or splash ads put in front of YouTube videos that are fed through to other websites (say VOX blogs, etc.) may be more tolerated.
• Subscription services - Perhaps users who aren't willing to see ads would be willing to pay a subscription fee to watch videos.  While those who are happy to watch ads, could do so, in lieu of paying a subscription fee.

• Free to stream X number of times - Pay to watch more than X times or to download the video to your PC, Phone, iPod, etc..

If, however, Google wants to make serious money with YouTube (without being "evil" in the process), there is plenty of room to innovate...  As I mentioned in an earlier post, YouTube recently announced that it would soon incorporate an audio engine that recognizes songs laid on top of home videos that appear on YouTube. At the end of videos, YouTube will give viewers a chance to legally purchase those songs.  This technology could be used to allow users to buy/download videos from studios/ networks as well.  However, I see  enormous possibilities to innovate and create revenue generating opportunities, which would allow Google to extend the advertising empire it started with AdWords into a whole new generation of interactive advertising.

Google could power a next generation advertising platform on YouTube that works like this for consumers:

• Watch a video on YouTube
• If you've liked anything you've seen/heard about in this video, buy it now or get a discount to buy it.
• YouTube could suggest products to purchase that appear in the video that users have just watched.  Advertisers already pay to get rappers to mention products (cars, booze, etc.) in songs, and they pay for subtle (or not so subtle) product placement in films and TV shows... I imagine these same advertisers would LOVE the opportunity to immediately capture customers by either enabling them to buy (or providing them coupons to buy) products featured in YouTube videos.
• If you like what you've just watched, check out these other programs X,Y,Z (this already exists on YouTube, but it could be enhanced/expanded to more closely mirror the system on NetFlix, which recognizes a users' interests and behaviors in combination with the behavior of users with similar profiles).

TV Networks and movie studios may be more likely to allow YouTube to use their content, if significant revenue sharing opportunities are involved.  A great way to generate tons of ad revenue (without bothering the consumer) is to work with advertisers who pay for product placement within movies and TV shows, allowing them the opportunity to capture new customers who are exposed to their product placement via watching movies/shows on YouTube.  YouTube could either allow users to click-to-buy (or express interest in) products within videos (a possibility if the videos are uploaded directly by the studios/networks) OR offer viewers the opportunity to purchase any of the featured products at the end of the video. 

For those of you who are wondering why networks/studios would want allow YouTube to reap the rewards of this idea, versus just implementing it themselves on their own websites, that's a great question.  In order to make this model work, Google/YouTube would have to make a multifaceted and compelling case, which could include the following points:

• YouTube has the ability to bring new viewers to network's/studio's content... When a user goes to YouTube, they often go to explore/discover new content.  Whereas, users that go directly to a network's or studio's website go with the intent of discovering content they already know about.
• YouTube could easily maintain multiple years of content, bringing back to life ad opportunities that studios and networks thought long gone (see Reese's Pieces example a few paragraphs below).
• Google is an advertising machine and has the ability to share revenue with studios and networks. (YouTube/Google would need to make this case strong enough by offering enough of a revenue share to discourage networks from thinking it is worthwhile to expand their own IT staff and infrastructure to implement the idea themselves.)
  

In addition to enticing networks and studios, YouTube could easily entice individual contributors (home video producers) to upload quality video content.  One way to do this is by maintaining a list of products and songs that have the potential to generate extra revenue sharing opportunities for uploaders.  For example, I mentioned earlier that advertisers are willing to pay rappers to mention products in their songs.  Why wouldn't those same advertisers be willing to pay YouTubers for playing those songs on top of their home movies IF they could prove that doing so increased customers?  If viewers had the immediate opportunity to purchase the product they just heard about on YouTube after watching a video, YouTube would have the case to get ad (and commissions) revenue off of the advertiser.   To prevent gross over commercialization and "pimping" of products, YouTube could require videos to get a certain number of page views and high rankings from viewrs before agreeing to share the revenue.

Taking this a step further, if, someone were to upload a video with a rap song overlaid on the top that mentioned say "Sprite" and PepsiCo didn't want to pay to have viewers "click-to-buy" (or print off a coupon) at the end of the video, Google could offer that opportunity up to a Sprite competitor, like "7-Up".

A few use cases to illustrate my point...

• Watch the movie, ET, and at the end of the movie, have the option to buy Reese's Pieces or get a manufacturer's coupon for 10% off. 
  

  E.T. - The Extra-Terrestrial (Full Screen Collector's Edition)
• Watch Grey's Anatomy, and at the end of the show, download songs from the soundtrack from the record labels or a Gray's Anatomy t-shirt from ABC.
  
  

  Grey's Anatomy - Season One
• Watch someone's home movie with Snoop Dogg's "Gin & Juice" laid over the top, and at the end of the movie, buy the song and/or download a coupon that allows you to get a 10% discount on your next Segram's Gin purchase at BevMo. (When viewers use these coupons, there is even an opportunity for revenue sharing with YouTube, The Record label, and the person who posted the video and chose the song.

In summary, ad revenue and user enthusiasm potential is far from lost for Google and YouTube.  In fact, the world is very much Google's oyster.  There are infinite revenue generating possibilities for Google, content owners, and advertisers, which, if executed properly, benefit the consumer.  The trick is thinking creatively and getting buy-in from both advertisers and content owners. If anyone can do it (without being "evil"), Google can.

According to a new survey, published by The University of Massachusetts Dartmouth, “the hype” around social media “is real.”  In November and December or 2006, U Mass Dartmouth’s Center for Marketing Research, under the direction of blogging researchers Eric Mattson and Nora Ganim Barnes, completed a telephone survey of “Inc. 500” list to find out if and how they’re using social media.  The “Inc. 500,” published every September by Inc. Magazine, is a list of the fastest-growing private companies in the United States.  According to the executive summary, existing research shows that 8% of Fortune 500 companies have a public blog, and the U Mass team set out to find out whether the use of social media was the same in companies that were “selected by growth rate rather than revenue.”  What they found was encouraging.  Fast growing companies are utilizing social media at much higher rates than earlier research indicates for Fortune 500 companies.  In the executive summary, the researchers write:

“As one of, if not the, first studies of social media adoption with statistical significance, this research proves conclusively that social media is coming to the business world and sooner than many anticipated.”

The full results of the study will be published throughout 2007 in a variety of journals.  Keep your eyes peeled for an article in The Journal of New Communications Research coming this March. The researchers from U Mass have promised to send me a link the the article soon as it is available. When they do, I'll post it in this blog. In the meantime, the executive summary is well worth a read.

Included in the summary are several interesting graphs. The highlights include:

• When asked how important social media was to a company's business/ marketing strategy, most respondents felt that it was important:
  
• 26%= Very important
• 40%= Somewhat important
• When asked what type of social media companies used, responses were as follows:
  
• 33%= Message/Bulletin Boards
• 27%= Social Networking
• 24%= Online Video
• 19%= Blogging
• 17%= Wikis
• 11%= Podcasting
  

I can’t help but wonder: Did social media help propel the responding companies into the Inc. 500, or is it just coincidence?  Then again, I’m still wondering, "Which came first, the chicken or the egg?"
 
 

I’ve talked a lot in this blog about how companies are using social media to capture new customers and engage existing customers.  Today, Advertising Age wrote a fascinating article on the success of Canadian toy manufacturer, Ganz, who has used social media and the Internet to spark massive sales of its Webkinz stuffed animals.  I’ve got mixed feelings about Webkinz marketing model and success. On the one hand, I admire the Ganz creativity. On the other hand, I question whether Webkinz takes marketing to children one step too far.  Before I explain this paradox in more detail, here’s some background…

Webkinz, which launched last year, are proving exceptionally popular among American children aged 6-11.  The success of Webkinz is so impressive that Advertising Age refers to them as “Beanie Babies on steroids”.  By November 2005, Ganz had sold one million Webkinz, without doing any formal advertising.  Ganz reports that this number was pushed “significantly higher” during the holiday season.  Instead of advertising, Ganz made Webkinz successful  by engaging a strong network of sales reps and retailers as well as innovative PR and social media strategies.  Bloggers and YouTubers started talking about Webkinz en-masse, which attracted the attention of the media and resulted in publicity on "Good Morning America," "Regis & Kelly" and "Rachael Ray."  Social media combined with the power of traditional press accelerated the sales of Webkinz.

Webkinz word of mouth success via social media is in great part to do with its web-savvy product strategy.  Each Webkinz stuffed animal comes with a printed tag, with a secret code and the address of what Advertising Age refers to a “safe” social-media enabled website for kids.  Once registered, kids can dress and feed their avatar Webkinz by earning “KinzCash” by playing games and winning quizzes.  Kids can also engage their avatars with other Webkinz avatars by inviting them to be friends and sending messages from a pre-selected list of options (Advertising Age uses the example “You are” and “very nice”.).  So, in effect, the Webkinz site becomes a mini MySpace for very young kids, without the threat of sexual predators. Imagine the success of Cabbage Patch Kids in the 1980s, and add to the “adoption process” the power of the internet and talking cartoons, and it’s not hard to see why kids can’t get enough of Webkinz.

The concerning part of Webkinz and similar products is the way that they engage with and solicit information from children.  When a child goes to the Webkinz site s/he is greeted by vivid cartoon images and written instructions.  When the child clicks on the text “My First Adoption,” a cartoon named “Ms. Birdy” appears welcoming the child to the “Adoption Center.” Ms. Birdy asks the child to read and complete the end user license agreement (EULA).  Webkinz’s EULA is a typical legal masterpiece.  It contains text that is well beyond the reading comprehension level of a 6-11 years old, and yet, without suggesting that the child ask for parental assistance, “Ms. Birdy” asks the child to read and agree to the terms contained within the EULA.  Included in the terms is a paragraph, which says that any feedback provided to Danz on the site will become the intellectual property of Danz. I understand why Danz has this clause in the EULA, but I don’t feel that it is appropriate to expect that a child can read or understand a legal document intended for adults. I take issue with any website that expects a minor-aged child to click through and agree to a legal agreement without parental involvement – especially one that claims ownership of any intellectual property that the child submits in the form of feedback for the site.

After the child clicks “I agree” to the EULA (which they couldn’t possibly understand), Ms. Birdy speaks, telling the child that if s/he is under 9 years old, her/his parents should help her/him with registration.  The site then asks the child to submit personal information into the website: first name, date of birth, country of residence, and state. Although, it is not considered personally identifiable, this information does not appear to be transmitted securely, which is concerning to anyone illegally watching a family’s internet activity or a child predator stalking kids at the local library.

The child is then asked to create a username and password and submit the secret code on the tag of their Webkinz animal.  This code allows the child to play in “Webkinz World” for one year from the “date of adoption,” with the option to renew after that year for a fee.  All of this, is, of course, explained in the EULA, which is too complex for a child to understand. 

While I am excited to see social media being used as an effective marketing tool, and I am pleased that DANZ complies with the Children’s Online Privacy Act (COPA), the Webkinz registration issues I mentioned highlight a larger issue of concern.  Companies are marketing to children, soliciting information from them on-line, and asking them to read legal agreements, which are beyond their level of comprehension.  It is difficult for parents to watch out for their kids in situations like this.  If a kid thinks it is okay to input their information onto, say, the Webkinz’s site without parental permission, what is to say that same child won’t think it is just as okay to give that information to a stranger via another website?  Nothing, unless their parents are involved.
 
One of the things that should be of growing concern to social media enthusiasts and child advocates alike is that there is currently no safe way to identify whether someone is a minor on-line.  Having a “second life” full of social media and networking on-line is becoming more and more common. In so many ways, anonymity is an accepted part of the Internet. This may hurt kids.  By this I mean, in real life, a child can’t go into a 7/11 to purchase porn, cigarettes, or booze, without showing appropriate age identification.  However, on-line, there is no such thing as an age identification. The Internet is largely anonymous.  As a result, there is no way to protect kids from seeing or interacting with inappropriate material, as there is in the non-anonymous “first life” – unless that material costs money and requires a credit card to purchase. A scary thought.

Thanks to technology and the Internet, the world is becoming increasingly transparent and accessible.  Social media is playing an important role in this transformation.  So far, most people seem to be responding to the power of social media favorably, and they’re using the power of social media for good.  However, there is a risk that the pendulum could shift in the other direction over time.  Below are the "5 Deadly Sins" of social media - pitfalls that proponents of social media should watch out for and proactively advocate against:

• Market saturation: There is a proliferation of social networking sites available – lots of sites are competing for users time.  Marketers are creating new social networking sites in record numbers to promote their products, and the number of traditional social networking sites (MySpace, YouTube, Bebo, Gather, WAYN, CyWorld, etc.) are also growing.  Users often use different for the same purpose but to meet different people.  If the market becomes overly fragmented, it may become less useful and more burdensome to user.  I hope that a natural market consolidation will happen eventually, but in the meantime, the industry runs the risk of users “burning out” from having to juggle too many different websites, on-line “friends”, different profile inputting tools, and passwords.
• Exploitation of social media at the expense of others: Social media makes it easier than ever to share information on-line.  While, the power of information sharing is good, it can also be dangerous in the wrong hands, enabling: fraud, misrepresentation of identity, identity theft, sexual exploitation, and unethical sharing of corporate or government secrets.  I just read an interesting article on the security risk that social media presents to corporations.  The same is true for governments and individuals.  The “Star Wars Kid”  and Paris Hilton were two of the first people to learn a thing or two about that.
• Eradication of privacy: This one is closely linked to the bullet point above on exploitation, but I felt it deserved its own section because it goes beyond exploitation because what is considered private to one person, isn’t necessarily considered private to another.  The Washingtonienne case is a good example of this.  Another example is that anyone can get an aerial photograph of your house at Google Maps or go to Zillow to find out what your house is worth.  Add location based social media services and mobile phones into the mix, and tracking people's location becomes easy via services like Helio's Buddy Beacon and Dodgeball.  While these are great services and they offer opt-in privacy, it's scary to think what could happen if either service were hacked.  Alternatively, imagine the damage that would result if someone's location information got into the wrong hands or was commandeered by a "friend" turned stalker. 
  
• Opportunistic litigation: Lawsuits like those filed earlier this week against News Corp. pose a strong threat to the health of social media.  If cases like these succeed, the rulings will send a dangerous message to the public: “You’re not responsible for your own safety or the safety of your children.  Someone else is.”  Unjustified lawsuits also stifle technical innovation and have the potential to strangle social media with excessive amounts of red tape.
• Opaque Marketing: Marketers are becoming more sophisticated about the ways that they use social media to their advantage.  It is already difficult to avoid pop-ups and other advertisements on-line.  And, with some social media sites, it difficult to tell what is advertising versus what is genuine, unbiased opinion.  Take, for example, bloggers who get paid by companies to evangelize products (I don’t, but a lot do).  Advertising on social media sites isn’t nearly as transparent as it should be, and social media runs the risk of being tarnished by overzealous marketers.

1/22/07 UPDATE: Thanks everyone for your insightful comments.  I just read a great article by Mark Zielinski, a UK-based security engineer.  The article talks about the threat that social media poses to corporate security.  In the article, Mark talks about how employees use their work computers to check their social networking pages and that this poses a threat to corporate networks.  Unsurprisingly, employees checking social media sites rather than doing work probably, has an impact on productivity - even more so than personal email. With these two points in mind, I'd like to add "Bringing Down the Corporation" as the 6th deadly sin of Social Media.

I've just launched a new VOX group called Social Media.  If you're interested in joining, click here!  I've linked all my blogs to this group, and I hope that others who are interested in Social Media, Social Networking, Marketing, Web 2.0, Mobile 2.0 and other colliding topics will add their relevant blogs too!

Everyone in marketing is talking about “social media” these days.  I’d be tempted to add the term “Social Media” to my “bullshit bingo” card, except that as you can probably tell from my previous blog posts, I like social media.  In 2007, developing an effective Social Media strategy is an important part of developing a successful and multi-pronged marketing strategy.  The problem is that with so many companies jumping on the “social media marketing bandwagon,” so quickly, marketing-focused social networking sites are running the risk of reaching saturation point, and many marketers are not taking the time to think strategically about how to use social media to their advantage.

There are many examples of social media marketing efforts that have reaped excellent results, but there are even more examples of such efforts that have gone awry, sucking valuable marketing dollars without having much impact.  Yesterday, blogger Jerry Bowles wrote an interesting blog on FASTforward.  In it, he discusses how corporations are using social media to capture new audiences.  The article mentions successful uses of social media in corporate marketing like MyCoke.com and Carnival Connections as well as ineffective attempts like MyDream.tv by Lincoln and Ford Bold Moves. At the end of his blog, Bowles concludes:

“The major truth of corporate-sponsored social media campaigns is that no matter how good they are or how sensitive they are to the concerns of the “community,” they won’t improve the bottomline unless you have something to sell that people want.”

I couldn’t agree more with Bowles final comment.  Adding to it, part of the problem with failed social media marketing campaigns is that they’re not well devised from the start.  Let me explain…

There are two basic ways to employ a social media strategy:
Create a stand-alone social media site, or
Leverage existing social media sites to your company’s advantage (e.g. YouTube, MySpace, Friendster, Second Life, etc.).

In an ideal universe, before deciding which tactic to employ, companies should be very clear about the objective(s) of their social media marketing campaign.  Many companies aren’t clear about their objectives, and I believe this is because:

1. The “science” of social media is too new and largely undocumented/undefined and
2. Companies who do not yet have a social media marketing strategy feel pressured to come up with something quickly, lest they fall behind the curve.  

By defining the goals of a social media marketing campaign more tightly from the start, companies will have a better chance and building a solution that meets that goal.

If the goal of employing a social media marketing strategy is to bolster enthusiasm for a specific product among a group that is already using that product, or expose existing customers/ enthusiasts a particular product to a new product from the same company, then developing a stand-alone social media site, like MyCoke.com, may make sense.  However, before building a stand-alone social media site, a company must already have a very strong base of customer enthusiasts who like to talk about their experiences with products on-line (i.e.: Coke, Apple, Mini Cooper, etc.) and be ready to offer something materially different/ better than those users can get elsewhere.  Creating a stand-alone social media site is an expensive endeavor, but if it is done correctly, for the right reasons, and targeted towards the right contingent, at the least, the likely result is increased web traffic to the company’s website.  MyCoke.com and Carnival Connections (both mentioned in Bowles’ blog) are two good examples. Whether having a well used, stand-alone social media site translates to higher sales remains to be seen, but increased web traffic from customers can’t be a bad thing.  

However, in a world where consumers are increasingly being bombarded with so many social media and social networking options, it is becoming increasingly difficult for companies to succeed in creating stand-alone social media marketing sites that have a sustainable and positive marketing impact and drive traffic.  In my opinion, the safest option for marketers that are trying to attract the attention of prospective customers that are not yet familiar with their specific product, company, or brand, is piggybacking off of existing social media sites – like YouTube, Friendster, MySpace, Gather, Vox, Second Life, etc. to attract attention to their products/services.  It helps to learn how to walk before you try to run.

Today, the self-proclaimed “tech gossip rag,” Valleywag, published the following graph, suggesting that Social Networking is past its peak from a media coverage perspective:

Valleywag writes:

The social network -- the umbrella term for features of a website which allow users to track their friends -- is past its peak.

Mentions in the press of "social network" or another even uglier phrase, "social networking", reached 1,158 in September, but have declined since. That could mean a decline in media interest in sites like Myspace and Facebook or, more likely, an acceptance that all media will be social, all successful sites will allow users to "friend" eachother, and that it's no longer interesting to spotlight a feature so ubiquitous.

It is true that when a trend reaches critical mass, news media loses interest… “News” is only considered “News” if it is, in fact, “new”.  Case in point- the growth of corporate websites in the early 1990s… The first corporations to build websites made international news.  Today, I can’t think of any large, successful company that doesn’t have a website.  Websites are now a prerequisite for big business.  One day, the same will be true of “Social Networking” and “Social Media”…. I’m not convinced that that time is now, or that the recent downturn indicated by Valleywag’s graph is indicative of a “trend”.  Instead, I think it is indicative of stabilization in the market following several months of very big news.  (And, while I have no empirical evidence to support this, it may also be indicative of a shift away discussing “social networking” alone towards discussing “social media” as a whole.  If any of you have seen evidence one way or another on this, please post a comment.)

I’ve numbered several points on the graph to illustrate my point about stabilization.  Looking at the popularity of the word “social networking” in relation to some of the big events on-line over the course of the last year is interesting:

1. July 18, 2005: News Corporation acquires Intermix Media, Inc and MySpace
2. March 2006: MySpace was the second most trafficked site on the Internet (next to Google) with Facebook at number 7. At times, MySpace had more traffic than Google (Duffy, 2006)... And - Hitwise "US Consumer Generated Media Report," reports that visits to MySpace increased 51 percent March-September 2006, outpacing the 34 percent overall growth for the social-net category during the same period.
3. May, 2006: comScore Network reports that Myspace surpassed 50 Million U.S. visitors in May.  The Top 50 Web Rankings and Analysis report released by comScore Media Metrix in may suggests that online interest in the World Cup and NBA Championships and the Spring television season drove traffic to popular social networking sites (see graph) http://www.comscore.com/press/release.asp?press=906
4. October 6, 2006: Rumors about Google acquiring YouTube started on TechCrunch.  October 9, 2006: Google acquires YouTube

The “major” events in “social networking” over the last year or so have definitely been considered big news.  The general public, companies, and media outlets seem eager to watch how social media is changing the on-line and business landscapes. Sure, the apparent “lag” in the term “social networking” since October may be the start of a downward trend. In my opinion, it is more likely a brief correction in the market following the major news around Google’s acquisition of YouTube in September and rumors about Yahoo’s social media strategy.  After all, the graph indicates that the term “social networking” is still as popular now as it was back in August, which was the highest it had ever been before.

As the number of mainstream companies announce the integration of s-commerce/ social media into their overall marketing strategies, I suspect that the term “social networking” will be surpassed by more broad categorizations like “s-commmerce” or “social media” of which, “social networking” is a component. 

For any non-VOXers who want to post comments, feel free to email me, and I’ll manually post your comments: socialmediablog@gmail.com.

Note: As I was doing research for this blog, I discovered that Google News doesn’t allow historical searches of news articles between specific dates. If anyone has a site that they can recommend that allows for a historical news search between specific dates, I’d love to hear from you.

Sources:
Michael Duffy, 2006. “A dad’s encounter with the vortex of Facebook,” Time (19 March).

Gather is a social networking site for adults. It is free, fun, well organized, and a little bit like vox, though it encourages cross posting of blogs, articles, comments, etc. around specific "groups" of participants with similar interests.  There are some really interesting blogs, conversations, and participants happening on Gather... 

For example, one of America's most well known criminal lawyers, Alan Dershowitz has a group on Gather and is in the midst of publishing a six part series of articles on a variety of controversial, and politically fueled topics.

Today, Borders launched a new group on Gather, making it one of the many companies that is now using social networking to further business by reaching out to prospective customers.

Gather works on a revenue sharing model, not unlike other social media sites like Revver.  Here's how Gather's  CEO describes it:

Gather is a place for you to connect with people who share your passions. It's a place where you can contribute thought, art, commentary, or inspiration. We will reward you for all the great things you will share with others in your communities of interest. And together, we think we will create a pretty special place to hang out online.

Gather will make money by displaying advertising to people who use Gather's services. It just seems fair that we share our advertising revenue with you based on the quality and popularity of the content you contribute on Gather. We will also share some of our revenue with you if you choose to use the site actively, exploring content that others write, searching on Gather and on the web, and inviting your friends, family, and colleagues to use the site. We will pay occasional users in points that you will be able to use to purchase goods and services from Gather partners in a few months. We will pay frequent users, who write great content consistently, in cash if they choose.

I think Gather is a really interesting site. I like the way that it makes adults with similar interests discoverable to each other.  I've only used it for a short time, so I'll be interested to see what my longer-term impressions are.  To test Gather.com a bit more and hopefully extend the readership of this blog, I've set up my own Gather group: socialmediagroup.gather.com.  I hope that people will use this group to share information on social media, social networking, web 2.0, mobile 2.0 and related topics.
 

Do you use Gather? If so, post a comment and let me know what you think.  If you're a non VOXer, feel free to drop me a line with your comment and I'll post it manually: socialmediablog@gmail.com.