23 Musings

A study from PQ Media shows that word-of-mouth marketing has grown by 35.9% in 2006 (to $981m) and is expected to be well over $1B in 2007 (maybe as much as $1.3B). Now, over 90% of word-of-mouth marketing is offline still but that's changing and with the new opportunities for communication and engaging your customers on the web I'd expect the shift from off to online to be pretty dramatic over the next year.

In 2006, word-of-mouth marketing was still the smallest of the main segments of marketing activity, however it grew almost five times faster than the overall marketing services sector, demonstrating that this is a market segment that is maturing rapidly.

I wrote some time ago about the power of word-of-mouth and how it had been rated as the most trusted form of advertising by consumers. Recommendation is highly valuable to any brand and likewise getting the wrong kind of PR from consumers who don't like your product or service can be extremely detrimental to a brand.

The rise and rise of social media and networking on the web is going to help the online medium become the biggest platform for word-of-mouth marketing in my opinion. There are a multitude of ways you can interact with your consumers and they can feedback to others on your behalf. Facebook is proving to be huge for word-of-mouth, getting a strategy to utilise this new exposure is really important for brands right now as if they don't control this themselves to some extent it will happen anyway without their input (which could be bad news for some).

Good news for the viral industry as well! I expect viral to take off in a massive way in 2008 as agencies and marketers work out how to integrate a good viral campaign with platforms such as Facebook and OpenSocial. This will open virals up to a much larger audience and facilitate much larger community conversations about brands.

Brand protection has never been more important so I hope you have your social media monitoring in place?

There's been some interesting stories over the weekend about Yahoo and Google and their social networking ambitions.

First off, Techcrunch is carrying a story about an interesting domain at Yahoo.com mosh.yahoo.com is supposed to be the home of a social network that Yahoo is building in-house. This could finally put to bed the rumours of Bebo/Facebook acquisition.

Then there are rumours (from Mashable) around Google's work on SocialStream. This is a project they are helping a U.S. university with, but the rumours are that it could end up being launched as a social network aggregation tool. Sounds interesting, but aggregating networks is never going to be as popular as building a network which inspires loyalty (therefore no need for an agregator).

It'll be interesting to see what Yahoo Mosh is all about. If they could build a next-gen social network using their exisiting Yahoo 360/Messenger user base they could very rapidly build something very powerful indeed.

Travel related social network WAYN (Where Are You Now) has opened it's doors to all users and removed the access restrictions that were once in place.

This seems to be a trend at the moment. Just the other day there was the news that HotOrNot are doing great now that they've removed their paid access restrictions. There's also a rumour going around that the school reunion website Friends Reunited (which was one of the first social networking environments) is doing so badly that they are considering removing all fees for access.

This has to be a response to Facebooks current exponential growth and the already massive MySpace, neither of which have a paid for model and do extremely well for it.

Paid for sites are never as sticky as a free one because users just don't come back as often and there aren't so many users to get the mass interest a network really needs.

It will be interesting to see how WAYN do with the restrictions removed. They have the potential to be huge if they get it right and have backing from some eminent people in both travel and the online environment. Of course they still have premium accounts you can pay for but you get all the good functionality for nothing now!

News out today that Yahoo have bought Rivals.com the college sports website for an undisclosed amount. Is this an example of them just desperately trying to play catch up by buying anything popular? Or is this a shrewd move given the possibility of MySpace coming into the fold?

Rivals.com would make a nice addition to a social networking feature and would give them access to a huge community of college goers (and sports fans) which is something Facebook have sewn up so far. Maybe Jerry is already having an impact, although this has of course been planned for a while!

There’s a lot of debate online at the moment about vertical communities and whether they are the future of social networking. Vertical, or niche, communities are aimed at particular interest types or centered around some kind of focus or need of the community.

The first question to come to my mind is whether web users really have the inclination to join multiple networks centered around their interests? In my view this is best served through the Facebook groups’ model, using an existing large network of users and allowing them to segment and join mini-networks as they see fit. This need is already filled by the Facebook/MySpace’s of this world.

So is there a place for something more niche to cater for those who don’t want to join the large, established social networks? Yes there is, but it needs to offer more to the user than purely social networking tools.

Vertical web portals are a highly successful business model; I should know I’ve built many and am member of a few. These however are built around the information and services they offer to the community rather than purely on the social network building blocks of connections to friends. Value added services and content are what’s required to make a success of a vertical network, and of course, being first to market will help dramatically!

Entice users through a combination of timely and relevant content with services that are relevant and useful and you will (if executed correctly) have a ready made audience who will be prepared to network. Making the network/portal sticky is key, your users aren’t going to keep coming back purely for the social networking aspects as they have access to much better facilities with other websites.

Of course there are also the advertising and monetization factors to take into consideration (as I assume you wouldn’t be doing this just for the love, although I do know of some who are). A niche user group is extremely attractive to advertisers and can lead to much more lucrative partnership deals than the large networks where the community is much broader. You’re niche network platform could be just the audience that a large advertiser needs to tap into, so ensure you optimise the site to allow for future partnership and sponsorship opportunities.

So if you’re thinking about creating (or already running) a niche social network, bear this in mind. Build in all the social networking tools but focus on the content and value added services. Get that right and you’ll find your network will build organically as the users find likeminded people to connect to and share ideas and opportunities.

There’s plenty of room for more niche networks if they are well thought out and executed!

It seems that the fogies are finding their feet in the web 2.0 world of social networks. Facebook is reporting a huge influx of members over the age of 25 and MySpace etc are becoming platforms for presidential candidates. Parents everywhere are hopping on the social network bandwagon and the kids don't like it one little bit!

I'm delighted at this news! As a 32 year old web user who's been involved in social sites for 11 years (that's when I built my first community based portal) I've been dying for more people of my age group to join sites such as Facebook. I've been a member since it opened up and have had huge difficulty finding people I really want to add as friends.

Needless to say, I've joined the Facebook group "Unlike 99.99 per cent of the Facebook population, I was born in the 70's".

Read more on this at the Telegraph.

TripAdvisor, the hugely successful travel review community site has launched some new features which take it into the realms of the social network and moves it further away from simply being a site made up of forum posts and reviews (although the e-commerce aspect is also strong).

They've released a feature allowing you to import a network of travellers from all the major email services (Gmail, Hotmail, AOL, Yahoo and Outlook contacts import). This allows you to create a network of travellers who can help you plan your trips with advice and reviews, link up with people you are travelling with or who may be going to your destination and prioritises content from your network in your search results.

This could be really powerful! Especially since they have launched the travel map application for Facebook, perhaps the next step is to allow you to connect automatically across the TripAdvisor and Facebook networks, create Facebook groups and import TripAdvisor content??

After the intial rush to dive into Second Life and try to establish brand presence in the virtual world, marketers are now reigning in their ambitions as they find it a tough task understanding the world and leveraging it's potential. Even worse, the locals (regular users of Second Life) are taking a dislike to many marketers as they are adding no value to the community and purely using it as an advertising platform to further their brand.

Disregarding the community is a fatal error. Marketers risk total failure of a venture in Second Life if they ignore the locals and fail to give something back. The same happens at MySpace as brands which launch profiles that are purely adverts find they get very little value from the venture.

The community is key. Engage them, entertain them, add value, give them a reason to interact with your brand and you'll win. Establish a need amongst the community and give them something they will want to take part in. Fail to do any of this and you have definitely wasted your money (except perhaps a bit of launch PR).

In Second Life some shops set up by brands are all but abandoned as the marketers involved fail to work out how to make it work to their advantage. 70 percent of the locals say they are disappointed with the presence that marketers have established.

It's a risky venture (unless you have big pockets) and one to research properly and plan a strategy for before you begin. Get it right and you could be laughing, get it wrong and you can generate a lot of the wrong type of PR.

In these days of social networks and community based web sites it's no surprise to learn that employers are wising up to the wealth of information that prospective employees are posting about themselves online. Most web users have signed up to at least one social network or community, many using their own names or posting identifying details. Some of these sites are good self PR (Linkedin, Xing, Soflow etc), while others can be sources of rather less positive PR (MySpace, Bebo, Faceparty etc). With the pervasiveness of these websites and the growing profile, is it now time people got a bit more cautious about what they post?

According to a report from business social network, Viadeo these social networks can have a significant effect when applying for a job. According to the research, one in five employers finds information about candidates on the internet and 59 per cent of those said it influences recruitment decisions. A quarter of HR decision-makers said they had rejected candidates based on personal information found online. Examples of information that has proved to create a negative impression of candidates include MySpace or Faceparty sites which expose excessive drinking or a general disrespect for work. Ethical issues which prospects post about on blogs and social sites can also put a stop to a job application before it gets off the ground.

The moral? Careful what you post, you never know who's reading your blog/profile... Self PR is something you can control through sensible use of blogs and social networks, you can even improve your employability through strategic use of the positive networks or blogging about issues relating to your chosen field. This could become a really good way to increase your profile with employers and to impress before you even get to interview.