Money: The Social Media killer

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by Jack Buckley Account Executive, [email protected]

 

Tinder, MySpace and YouTube are all examples of monetising services ‘gone wrong’. Whilst two of the three remain major players in the Social Media circuit, the change garnered a significant amount of negative publicity, and caused a user-exodus.

Whilst Tinder has yet to be replaced, Vimeo now outclasses YouTube in terms of usability. MySpace does not exist as a major player and has been replaced by Spotify. What’s the common denominator in their fall from grace? Poor monetisation.

The key for any social network to remain a viable business is a simple one: identify why people use your site, and maintain it. It’s said that ‘the man who chases two rabbits catches neither’, and that’s something that should be kept in mind – nobody uses social media to be ‘sold’ to. Find that one thing your brand does well, and focus on that. You can diversify later, but only once you have a strong core presence.
So far, Snapchat is the only company that has successfully implemented advertising into its structure. The way they have done this is by completely separating the two elements of their business, paid and free. By protecting the user experience, the advertisements have meshed seamlessly – so while Snapchat now make money through their ‘discovery’ option, it in no way detracts from the user experience.

Visit MySpace today and you will find nothing special. The music service, acquired by Tim Vanderhook and Justin Timberlake in 2011, was exceptionally good at providing music to users, but by diversifying too far, too fast and providing inconsistent, irrelevant advertising, they pushed their entire user base over to Facebook. What was once the leading social media site in the world, now sits at a global rank of 1,974. It occupies a strange space between Spotify and YouTube, with the usability and reach of neither.

Social media networks live and die on (what else?) just how social they are. It becomes easy to see users as statistics, but any business that forgets why their customers use their services will soon face business-ending issues.

Making money from your business is a secondary concern. Primarily, focus needs to be put on the product that is provided, and the overall user experience.