Make Money From Social Networks | Ralf Ahamer, Xing | iStrategy, Berlin

iStrategy Forum BerliniStrategy Forum Berlin
Make money from social networks –
example XING
Ralf Ahamer – CMO XING AG

7,0
7,5
7,9
8,3
Members in mio. Premium Members in thousands.
36% 41%
01 XING in Numbers (I)
470
513
550
606
635
662
Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09
6,1 6,4
7,0
Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09
470
513

12,9 *
35,3
02 XING in Numbers (II)
EBITDA in Mio € Umsatz in Mio €
37%
margin
2007 2008
6,9
2007 2008
19,6
* Excluding one-off costs for M&A

03 Business Model
5,95 € mth.
6,95 € mth. 3 Months
12 Months
Premium Membership Recruiter Membership
The XING Business Model consists of three main revenue streams:
Premium Membership, Recruiting Business & Advertising/ e-commerce.
39,95 € mth.
29,95 € mth. 3 Months
6 Months
1.
5,95 € mth.
4,95 € mth.
12 Months
24 Months
Job Board:
0,59 €/ Click on Job Ad
Advertising/E-commerce
Various models, Best Offers, Enterprise Groups, Opensocial
39,95 € mth.
49,95 € mth.
6 Months
12 Months
Fix-price 395€, 495€ , Corp sol.
2.
3.

5
Social Networks – What?
Why? Value?

Social Networks
Ideas
Jobs
Contacts
Social networks don‘t create something new – they just provide an
infrastructure for typical human behavior on the web.
01
Me
Contacts
Employees
Efficiency
Productivity
Friends
Love
Spare time

Ideas
Jobs
Contacts
Social networks don‘t create something new – they just provide an
infrastructure for typical human behavior on the web.
Social Networks02
Contacts
Employees
Efficiency
Productivity
Friends
Love
Spare time
Me
7

Dating Jobs
Deals
Acquisition
Family
Spare time
Almost 80% of experts and management clearly separate
business from pleasure
03 Social networks – professional vs. private
Dating Jobs
Ideas
Sales
Friendship
Party
Source: Forsa Study 01/ 2010

The Case of the Facebook Fairy
[Intern at a US Bank]:
“I just wanted to let you know that I will not be
able to come into work tomorrow. Something
came up at home and I had to go to New York this
morning for the next couple of days.”
04
Social Networks are a source of information for everyone.
They are comparable to elephants – they never forget...
morning for the next couple of days.”
[Boss]:
“Thanks for letting us know–hope everything is
ok in New York. (PS: cool wand)”

Social networks in real life
05

Viral Gene: Social Networks06
The virality lies in the added value that every additional member brings to
the community.
The viral growth in social
networks is a function of:
the added value a member gets
through another member.
through another member.

Value of social networks07
Value social
network
Registered
Members
ActivityX=
The value of social networks heavily depends on two values:
number of members and activity.
12
network Members
ActivityX=
If one of these is zero – the whole value is zero!

13
Shift of reach to social
networks

01 Social Communities – a success story
• „Republic“ Facebook is the 4th biggest country behind
China, India and USA. 300.000.000 facebook users change
their status message every day.
• In the last 60 seconds 15 hours of video material has been
uploaded onto youtube. If you add all videos material
together it equals 3.500 years of content (and growing)
Source: Sueddeutsche.de 19.09.2009
together it equals 3.500 years of content (and growing)
• Twitter had 1000% growth last year

Search queries reflect demand
Google Search queries reflect trends …
Facebook vs.
eBay
Source: Google trends: Graph above shows search queries worldwide. Graph below shows search queries in Germany
Facebook vs.
Spiegel

Back in time 2006 vs. 2009 (1/2)
IVW Page Impressions October 2006: Portals portals everywhere…
Source: IVW, Page impressions x1000 for October 2006

Back in time 2006 vs. 2009 (2/2)
IVW Page Impressions October 2009: Invasion of the social networks
Source: IVW, Page impressions x1000 for October 2006

On XING there are up to 25% of all employees of one
industry in Germany.
Reach of XING05
Source: XING internal statistics for DE– Q4 2008

Usage of Social Networks
Brand Communities:
Social Book-marking Communities:
Micro-blogging Sites:
Podcasts:
Internet Usage Frequency
Social Networks are already the 2nd most popular entry point to the
web
06
Source: Ralf Schengber, 2009.
Search engines:
Social Networking Sites:
Forums:
Web-blogs:
Video-Portals:
Photo-Portals:
Special Interest Communities:
Everyday Several times / week Several times / month
Seldom Never / I do not know
that
No Answer

Social Networks – Context to information
Why bother “Google”…. ..when your peers are just a click away?
Our Friends, colleagues, family give context to massive
information overflow.
07
Unidirectional
(search function)
Volume
(search results)
Standard
(Portal site)
Bidirectional instantaneity
(comment & tweet features)
Value
(recommendation power)
Personal
(personal profile site)
= where information LIVES.
“The warm Internet”
= where information ACCUMULATES.
“The cold Internet”

Exkurs: Community Make or „Buy“ or both
¾ of all brand communities fail. Using existing social networks &
infrastructure could lower costs and increase speed.
08
- Over 2k Ikea employees on XING.com
- Over 90k users are fans on facebook
Ikea community „Hej“ recently started
- Over 90k users are fans on facebook

22
Chancen und Risiken von
Social Networks für
Unternehmen
Social networks and business
models

Subscription fees: Professional Networking01
Professional Networks have a huge (perceived) value that directly
translates into “money”. Members are willing to pay for that.
Consulting
Media -Print
Internet and New Media
Sales Public Relations
Science and Research
Training
Human Resources
Real Estate
Arts and Entertainment
Telecommunications
Media - Broadcast
Advertising
Financial Services
IT
Hotel and Travel
Education
Restaurant and Food
Beverage and Tobacco
University
Customer Services
AccountingSource: >82k tests on mynetworkvalue.com

Advertising: Web 2.0 in the marketing mix
100% 7-12% 30%
88-92%
ca.60-65%
The value chain of media planning must be disrupted. New scales of
ratings need to be defined.
02
Advertiser Media Agency Publisher
Advertising
medium
Kickbacks
Results:
• Marketstructure and value system constrain marketing
• Advertisers have (too) little Know-How for Web (2.0)
• Media Budgets go mainly in “traditional” online media

Virtual products
The expected market size of virtual goods (US) is 1,6 Mrd $*.
Social games share will be half of it.
- 65.000.000 Farmers***
- 26.000.000 are feeding their cows every day for 2 hours
- 100 Mio $/year revenue*
03
- 90 Mio $ in 2009 with virtual gifts**
*Inside Virtual Goods - The Future of Social Gaming
** C’t Magazine 2010
*Source: Business Week
*** check on facebook feb 2010: 78Mio already

Conclusion04
1. Clear goal and topic for your community
• „Having influence on your target group“ as a goal leads you in the wrong direction
• Set-up a clear topic for your community – e.g. “Professional networking”
2. Members and Activity
• Value of a social network = registered members X activity
• Viral growth in SN = function of value a member gets through another member
3. Keep in mind: First of all - your community serves its members
• Consequently listen to the community and serve their needs first
• See the community as living organism – it’s a socio-psychological challenge
4. Use existing infrastructure and reach
• Use XING, facebook etc. to leverage your business
• Community work needs resources in your company

Thank you
for your kind attention!
Presentation Titel | Author | City, 11/02/2010 27

Make Money From Social Networks | Ralf Ahamer, Xing | iStrategy, Berlin

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Andere mochten auch

Andere mochten auch (20)

Ähnlich wie Make Money From Social Networks | Ralf Ahamer, Xing | iStrategy, Berlin

Ähnlich wie Make Money From Social Networks | Ralf Ahamer, Xing | iStrategy, Berlin (20)

Mehr von iStrategy

Mehr von iStrategy (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Make Money From Social Networks | Ralf Ahamer, Xing | iStrategy, Berlin