Thursday, May 6, 2010

Demise of social media website


Internet industry is teeming with social networking sites. Top websites that has captured the mind share are face book, You Tube, Blogger, Baidu, Twitter, MySpace, LinkedIn, dig and WordPress. Although it is the trend, this in itself is no guarantee for social networking sites success? ‘Interactive nature’ of social media has transformed the meaning of ‘human communication’. This is a sharing mechanism that keeps users to the sites. Users increase the popularity of any websites and especially if I talk about social networking sites users work as a propellers to push to success. I opened my Face book account because some of my friends suggested me to do so. A high number of users attract the advertisers for advertising and this is how websites earns money and makes profit. “If anything goes wrong with ‘conversation mechanism’, it becomes the prime reason for the failure of any social networking websites”.

Since the inception of social media we have witnessed umpteenth sites lose popularity, after the initial success like yari, apna circle, bigadda, bharat networking, six degree, live journal and Friendster. Many sites have come and gone but the decline of ‘Bebo - Blog early, blog often’ really catches my attention. In April 2010 AOL announced to sell or shut down Bebo. The site was launched in 2005 and was acquired by AOL in 2008. Slowly it became the world’s most popular social networking site and still holds the position in UK and some other countries. It downturn started in 2007 when Face book over took it in terms of number of users.

Reasons for failure:

• Social networks need to have a clear purpose. It should define its target group from its inception. Many websites fail because of lack of conceptual planning and ignorance of users’ need. It prioritises monetization from the beginning and thus, advertisements are given more importance over users’ engagement. I am not saying don’t put banners because this is the way to earn money in Internet domain. But too much of it can result in the loss of user connect and may push them away. Social media website should have proper balance between advertisements and content. Ignorance of any of these two can be the reason for decline. So, use the space judiciously to keep your users engaged.

• Social media is about sharing; if you remove the sharing quotient then it will lose its essence. It might act like a king in the beginning but with the passage of time it will fail to offer anything new to users. Nobody wants to joins a social networking site that doesn’t do anything special other than what is already being offered by other websites in the market. Don’t be a copy- cat but try to lure users by delivering fresh and engaging features. This was the only reason people shifted from Orkut to Facebook. Facebook understood its users and gave a new angle to social networking. It added various features that helped users to share more with their friends. Games like Farmville and Mafia Wars are the top most games in social media domain. The number of Face book users is only growing with time.

• Social media website should be user friendly. Complexities in technology can diver users to alternate options. One of the vivid examples is Friendster’s failure. Though, Friendster offered different features it put an age limit for its users, blocking people who were below 18. Kids nowadays constitute the biggest users base for social networking. MySpace took a quick decision and offered all the required luxury to its users. But even MySpace could not keep the promise and headed downhill after a while. You cannot expect all of your users to be tech friendly. It is a good area that can give the website an edge. Social media is not merely about connecting people and sharing images and videos. It is also about being able to express them in the manner that users want them to be. I was wondering why the demography of Face book’s population is so diverse. The one simple reason I can see is its users’ friendly ecosystem. This is giving marketers enough reasons to participate and Face book enough points to earn.

Take away: Technology changes at lightning speed, so there is no guarantee that any one website will stay at the number 1 all time. Right now Face book is clearly leading but may be one day some other website can come up and take the hot seat in the social media milieu. As long as a social networking site can manage to offer engaging content, there is no reason for its failure.

Wednesday, May 5, 2010

Google’s Googly

When you talk about Internet, first word that pops up is ‘Google’. With the acquisition of ‘Episodic’ on April 2, 2010 Google added one more star in its kitty. ‘Episodic’ is a comprehensive platform for broadcasting live and on-demand video to web or any other web-enabled devices. You can host, stream, measure and monetize video content. This acquisition once again raised many eye-brows as when Google acquired ‘You Tube’ in 2006. At that time ‘You Tube’ was hardly making any profit. The turnaround is now in front of you. Here I will try to analyse how Google manages to turn these risky acquisition into success at jet speed.

Started from a garage, Google now has become one of the leaders in Internet space. If you go by sheer size, Google has almost 50% of the pie. Internet is one of the most fragile spaces, so in the end size alone does not count for much.
With the passage of time Google is only increasing its presence and there is no stopping it. It has redefined the nature of the game. No longer are the largest companies in any industry necessarily the leaders in today’s competitive world.

Google’s success:
One thing is clear. They are obviously not just organizing the world’s information’, they also own publishing platform/content like Picasa, Android, You Tube, Adscape, DoubleClick, Feed Burner, Postini, etc. That is what brings to light Google’s true strategy. Crux lies in Google’s strategy. Innovation and out of box thinking are the reasons behind its success. It has a reputation for risky acquisition and partnership and playing by its own rule to create innovation and value for its customer. Google has an upper edge in synergizing its product by seizing an opportunity to bolster its current advertising business model. Google always take first step and probably creates the new business paradigm shift, thus exponentially increase its user base. The real issue is integration; Google is working toward it by delivering maximum products mix in the online domain. It’s not only adding more option but re-branding many of its acquisition to integrate its offerings and there-by adding more value to its products. Today, competitors live in the hopes to sell their ideas or services to Google in order to become a part of profit opportunity by being linked with the dot com giant.

Everybody is keeping an eye on; what will be Google’s next move. Due to high competitive environment, Google also faces problems ranging from management, organisation to technology. One thing is quite obvious, though Google is in the online space so its revenue is based on advertising. However merely adding new avenues for ad is not its only strategy. Google knows that its ad space is high in demand not only because that it has more space but also because it functions on target advertising model. Google not only maximized its income, but also increased the relevance of those paid search ads. Its relevancy is driven by the attention people pay to it. Attention and trust of users are very important pillars in the online business. Google maintains it by delivering tailored and relevant search result. Google focuses on its users’ friendly experience by optimizing its service for end users’ first and for revenue second. It firmly believes that the better the user experience, the more easily money will follow.

Google’s founders Larry Page and Sergey Brin are deeply involved in its mission to organize world’s information. Now Google is widely recognized as the world’s largest search engine that provides relevant result in a fraction of second. The key success is its underlying technology called ‘PageRank’- a unique algorithm formula originally developed by its founder that can sort results according to their perceived importance.

Take away: Google started out as a search engine but soon leveraged other opportunities to hold and increase its presence in the Internet space. It also owns stakes in niche markets. It is one of the most important search engine companies with nearly 50% share. Today Google has competitive advantage over others, but to remain competitive in this information technology world it has to be flexible enough to fit itself in this giant ecosystem. If Yahoo and Microsoft are successful in delivering similar or better services than Google, then Google will be in deep waters.