During the Worldwide recession the lotteries jackpots are still huge therefore
people winning them still need to invest few million of dollars or euros or any
other currency to some business Internet business is still one of the most
attractive directions of investment. Now it is very difficult to create a
competitive and successful e-shop, web design studio, online project management
service or any other affiliation site because of huge competition. Some
entrepreneurs still try to create social networks like Facebook, MySpace, Bebo, but
majority fails. Does that mean that no one can repeat the success of Twitter or
Facebook which started with very little budgets? Probably not, but only 1 of 100
attempts may succeed.
What about bigger chance of success? Let’s see what big social networks offer to
people:
* Lots of contacts to choose from different countries, speaking different
languages;
* Lots of interests to discuss using social networking tools such as micro-
blogging, groups, forums, social bookmarking, file share etc.
* Unified communication features for all members;
* Generic forms of marketing and ads;
* Possibilities of using third parties applications (widgets) to satisfy
specific needs.
When people have general interests in communication with people worldwide in own
and general language huge social networks are the best solution. No one can beat
Facebook or MySpace in traffic as they satisfy this communication thirst. However
still remains the need for communication in local circle. Example is Hyves.nl
social network in the Netherlands, which is more popular than Facebook or MySpace.
There is a short presentation illustrating the local networks versus Facebook and
MySpace usage.
The newest hype of WWW is Twitter - the simple micro-blogging platform with lots of
the additional services around. Twitter is huge, but that is not going to last
forever because of Twitter clones. Someone counted more than 200 of Twitter-like
sites in different countries. That shows the power of the locally based similar
services to giant social networks. If someone has a spare million of dollars,
he/she should think about creating a local social network in some country or region
(example of regional social networking success is Netlog.com - one of the most
popular Social networks in Europe). Of course there is almost no market without
competition (I doubt there is big market in Zimbabwe where people do not have
electricity, not speaking about computers and internet), so it is good to analyze
the market first.
If we look at the social networks list we can clearly see another interesting
criteria - the interest based social networking. That’s the main competitor of big
social networks, as they cannot provide the interface for every interest. All they
can do is allowing third party widgets to be installed making the profile and
management of the personal space messy and troublesome (look at the MySpace
profiles). The interest based social network can be international; therefore it can
be easily tested on some local markets first and then launched internationally.
That makes management of investment easier and more effective.
What can be the main interests of people to be transferred to virtual space in the
shape of social network with friends ties, status updates, blogging, picture, video
exchange, bookmarking features, groups and chats etc.? Classmates, dating,
blogging, job search are the main ones attracting huge amount of people, but still
there are some other areas.
Let’s review it personally. I have a Russian Blue cat so I participate in such
social network for cat lovers as UnitedCats.com (by local country, of course). If I
would like to leave this network I would choose a brand new CuteAsHell social
network for pets in general. Why I like this social network instead of Facebook
Russian Blue Cats Group with almost 300 members? Because it has very nice features
for cat lovers such as virtual gifts (all kinds of kitty toys and equipment what
makes this gift feature unique), photo voting is called “Pat the cat”, blog can be
written on behalf a cat or owner which make really interesting to read. Also I know
that some of the participants of this community are professional cat breeders which
can really give me help if my cat gets sick or I do not understand her character.
Neither Facebook or MySpace cannot give me that.
I travel a little, therefore I participate in travelers social network WYAN.com
where people share their reviews about countries, tours, day trips and of course
shares pictures of the places of interest. I can easily make decision where to go
and what to see. I always can share my plans and can even make some friends in that
country to meet them once I arrive and hear another story about the country rather
than tour guides tell. Probably I will have lots of troubles looking for similar
information in Facebook and Myspace.
As a professional I have my profile in LinkedIn and participate in local
professionals discussions as well as global ones. Here I can share my
professionalism, participate in discussions about specific work related issues.
Here I can find another job, or find the entrepreneurs for my business plan. Have
you ever seen people who are hosting their resumes and CV in Facebook or MySpace? I
have not.
As you can see the interest social networks are very good for sharing the personal
interests and setting the communication among people with similar interest. In
Facebook I always see my friends speaking about the things I am not interested or
even do not understand (hear programmers speaking - if you are not in IT market
their language will be like gibberish). In the interest social network I will
always understand what my peers are talking about.
Investor should think if there are any interests which are covered quite poorly.
For example pet social network market is quite saturated as some serious people
made some investment. But maybe bikers’ social network still would make a nice ROI?
There are always some profitable markets uniting golfers, cooking lovers,
photographs, poker players etc. which must be investigated and some competitive
social networks with unique tools created. Technologically it is not very difficult
as there are so many open source systems with huge social networking add-ons
collections.
Another important feature of new social media should be a flexibility to adopt new
trends in case some phenomena like Twitter emerges in next couple of years. Status
updates are so popular (like SMS in Mobile world), that every social network must
have this feature and in some cases it must be better developed to fit the needs of
specific interest. For example poker players community enjoy the icons of cards
speaking about their hands, however Twitter cannot have any icons. So maybe poker
related Twitter clone FTsweat could provide such feature? Very big attention must
be paid for internal messaging system as it may become very powerful communication
and marketing tool. Look at the MySpace example. They have 125 million of active
internal messaging system users and once they will build a webmail service they
will automatically become 3rd largest email provider in the World. Interest based
social network may never do better email service as Yahoo or Gmail, but some handy
features can keep some members using internal mail outside the social network
space.
Creating social network is not enough. Every social network should have additional
applications for third party websites - widgets and apps for iPhones and G-phones
and all the rest new type of mobile devices allowing not to use computer for
communication. Without them every social network is doomed sooner or later. But
let’s leave this topic for future.
Summing up. If you are an investor, please consider creating local or quite narrow
interest based social network in order to kick Facebook’s and MySpace’s ass. That’s
not impossible. That’s better than wasting money creating one more Facebook or
MySpace.
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