Facebook, MySpace, et al = Double Bubble?

26 June, 2008

AdViking has good days and bad days when pondering Social Media and sometime this means quitting Facebook and sometimes heavy use of Twitter.  Generally, the main point is that we are in the early iteration of the what and how of Social Media and we’ve got a long way to go before it’s all pervasive and delivering true value to the user.

Recently came across Charlene Li‘s deck on the Future of Social Networks on SlideShare and thought it was worth sharing as some solid consolidation of thoughts flying around the ether.  i.e.:

  • The youth are all ready heavily into this stuff (e.g.:  Club Penguin)
  • Your Universal ID has to be easier to use
  • AOL, Google, Microsoft will be coming hard into this space

Obscene Valuations?

Anyway, onto the main point and that is there’s a lot of debate if the valuations the Social Networks are getting ($15bill Facebook, $1bill LinkedIn, $850mill Bebo, $580 mill MySpace) are just crazy and more proof points that we are on the cusp of bubble2.0 or are just fair indications of value.

There have been some recent work in just this area that is useful to ponder.

First, Andrew Chen had a stab at looking at MySpace versus Facebook: Analysis of both traffic and ad revenue, using Google Trends.

Second, Michael Arrington did some Modeling The Real Market Value Of Social Networks.

The later piece is the real interesting one to digest, mainly as they start from looking at a wider set of networks, use comScore data for the traffic and also the recent PWC ad spend numbers.  And though Arrington is the first to admit there’s some flaws in the model (e.g.:  LinkedIn comes out low but the actual traffic could be considered high value), you can still take it as a starting point based on some data rather than just plain rhetoric.

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AOL Purchases Bebo

17 March, 2008

On the back of the SXSW Mark Zuckerberg interview and the interesting macro movements around the future of social media advertising, it seems that Time Warner provides further validation to these trends and have acquired, considered by many the #3 player, Bebo for AOL.

AdViking’s early take is that by adding the additional platform and traffic to what they have all ready, AOL has some very interesting pieces in play and with their Platform A advertising stable they have a unique opportunity to be at the forefront of what happens next. Especially, if we consider that Zuckerberg considers that the solution to social media advertising isn’t going to be found in the next couple of years but decades.

The coverage has ranged from:


Bad News for Facebook (and MySpace)?

6 March, 2008

The story that Facebook UK lost 5% of users between Dec. 07 and Jan. 08 is a bit of old-rope now but AdViking has been on the road and wanted to come back around to this and also wanted to synch that with a recent report that shows the UK marketing decision makers are reticent to invest in advertising through social media.

Facebook is losing users!

The news that Facebook UK lost 5% of users is interesting for a couple of reasons (including that it’s buried in the coverage that MySpace lost the same amount of users for the same time period) but let’s see if the trend continues through the next couple of months, which is so nicely put by: Alex Burmaster, the Nielsen Online’s European Internet analyst

Just as one swallow doesn’t make a summer, so one month of falling audiences doesn’t spell the decline of Facebook or social networking,

Personally, AdViking would put some bets that the trend could be associated to some of the reasons Fuller mentions in his post about why he was quitting Facebook over on A Fuller View. This was mirrored with some reasons that the quality weekly UK magazine Grazia had to say about why they are bored of Facebook.

NB: I am an active FB user but have changed drastically my usage pattern the platform over the recent months and now use it for lifestyle enhancements (e.g.: Integration with 30 Boxes and Dopplr).

Marketers are saying no to Social Media advertising

More interesting and lost amongst this noise was that a poll published by TNS Media Intelligence/Cymfony shows that senior corporate marketing executives believe that social media in some form will be lasting, but in the UK only 18% of companies believe that by not spending on social media they are likely to fall behind competitors.

The poll, which was taken across France, North America and the UK, used the broad definition for Social Media, including: blogs, forums, social networking and video sites. You can get access to the summary of the findings by going to http://www.socialmediainbusiness.com/.

Some other interesting highlights:

  • 0% thought it would impact purchasing intent
  • 9.9% said they didn’t have sufficient budget to make forays (i.e.: spend isn’t an issue)
  • 38% saw social media sites as a new advertising channel
  • 49.3% believe social media should be monitored at exec level
  • 0% thought social media would have little significance in 5 years

AdViking’s take is that if you narrowed the spectrum to look at just the obvious social networking sites (i.e.: Bebo, Facebook and MySpace) then these numbers would look drastically worse. The thing is today’s senior marketing exec isn’t really going to be savvy to the idea that the potential for this kind of advertising and so will probably be as wrong about Social Media as they were about Search advertising.  You can read AdViking’s nascent views on the importance of this new format in this comment on John Battelle’s Searchblog.