A review of key factors in the social media economy, including current social business models, impacts on other businesses, and how social builds new economic opportunities. Presented to Tufts University class on "Social Media: Participatory Culture and Content Creation in Society."
2. About me
Senior Manager, Social Media & Online Community at TechTarget
Past:
Not a guru, ninja or sage (or an economist)
3. Overview
The (current) business of social media
Existing business models
Expectations for the market
Social media as a tool for other businesses
How companies are using social media to build business
Challenges for businesses and users
New business models
Sharing/collaborative consumption examples
The future?
4. Web 2.0 = social media?
Wide reach
Data-driven
User-centric
Perpetual beta
Multiple devices
5. How ‘the long tail’ applies to social
Wide range of content available
Participation is spread out along a scale
Niche communities are just as important as the mainstream
Targeted recommendations (human or machine) drive action
17. How do Facebook/Twitter make money?
What model(s) does Facebook use? What about Twitter?
What opportunities are there to expand? What are the risks?
18. The ‘real’ product
“If you’re not paying for the
product, you are the product”
– Anonymous internet pundit
A social network’s real value = Number of users?
20. Why am I seeing these ads?
“Facebook has
collected the most
You are being watched
extensive data set
Data mining based on your profile + posts
ever assembled on
Retargeting from sites you’ve visited
human social
Buying a coat? Buying a car? Facebook knows behavior.”
all
27. Who participates in this new economy?
Businesses – you don’t exist if
you’re not on social media
(Content) Marketers – every brand
is now a publisher
Customer Service – problem
solving
Data Analysis
Customers – what makes it all work
38. Brands have both more and less control
Owned vs. earned vs. paid media
Owned: Created/controlled by business
Earned: Shared by press and public
Paid: Sponsored content/advertising
“If [Facebook’s] News
Feed is the thing that
everyone sees and it
controls how
information is
disseminated, it’s
controlling how
information is revealed
to society, and it’s
something we need to
pay very close
attention to.”
39. Can businesses and users coexist?
Business
objectives
Pressure to make money = more advertising
If users leave, no more business opportunity
User
experience
40. Your turn
Find a brand you like on social media.
What marketing efforts do you see? What’s their persona?
Are they successful? How can you tell?
Why would you follow them? Deals, customer service,
humorous content?
41. Social creates new business models
How does social media support the “collaborative consumption”
economy?
What new opportunities and challenges does this economy create?
What are some examples of participants in this new economy?
48. Recap
Lots of hype, but some hope for social media businesses
Social supports existing business models – with good
execution
Social creates new business opportunities
With every opportunity, there is a tradeoff
We’ll focus on the big boys for this discussion, but be thinking about the smaller upstarts, too
I say this is (almost) current because probably minutes after this was created, some new social network launched
This is more evidence of the ‘long tail’ –social media creating and supporting niche communities who previously would not have had an outlet; those are markets (truly an age of abundance)
Quick reactions to this video? Would you invest in social?
Farmville
Facebook Gifts
Have you ever bought something in a game?
Does this bring up privacy concerns?
Facebook Ads –
Can get very specific, target any niche
Pricing changes depending on targeting (the long tail)
Some companies do a great job of responding to customers via social media – this looks good for them and can also save them some money if they do it right
Ever interacted with a company via social?