The big social networks like Facebook struggle to monetize their membership base. Their biggest problems their size and maintenance cost as opposed to advertising revenue.
What is the reason behind that? After all a big and active community is a big marketing resource. Big networks like Facebook are very general albeit there are interest groups within them. There are attempts to target those groups but the old banner ads aren't doing a good job. In order to monetize those interest groups businesses have to sell directly to them. But the companies running social networks don't sell.
Even worse is the fact that they don't let other marketers sell to their members too. It's easy to understand why - by allowing others to sell, they don't gain much and there are other issues such as privacy.
The size is a good thing but it proposes challenges. On the other hand a very targeted small community is easy to maintain and its commercial intent can even be bigger. There are so many more ways to monetize a small community once the technical problems are solved.
Think of how much would Facebook be worth if it had paid membership. Of course, no-one would pay for something general like Facebook, but imagine a small community of certain interest. The ideas a very targeted group share are worth every penny for subscription. What about paid classifieds and business directory. Not to mention the obvious affiliate promotions and selling your own products.
The essential factor in social marketing is finding a niche where there's no community but the crowd is hungry for it. The Internet is a big place and there are hundreds of thousands such niches, targeting them can be very profitable from square one, unlike targeting general audience with no goal whatsoever. Remember the old adage - try to please everyone and you will not please anyone.
What is the reason behind that? After all a big and active community is a big marketing resource. Big networks like Facebook are very general albeit there are interest groups within them. There are attempts to target those groups but the old banner ads aren't doing a good job. In order to monetize those interest groups businesses have to sell directly to them. But the companies running social networks don't sell.
Even worse is the fact that they don't let other marketers sell to their members too. It's easy to understand why - by allowing others to sell, they don't gain much and there are other issues such as privacy.
The size is a good thing but it proposes challenges. On the other hand a very targeted small community is easy to maintain and its commercial intent can even be bigger. There are so many more ways to monetize a small community once the technical problems are solved.
Think of how much would Facebook be worth if it had paid membership. Of course, no-one would pay for something general like Facebook, but imagine a small community of certain interest. The ideas a very targeted group share are worth every penny for subscription. What about paid classifieds and business directory. Not to mention the obvious affiliate promotions and selling your own products.
The essential factor in social marketing is finding a niche where there's no community but the crowd is hungry for it. The Internet is a big place and there are hundreds of thousands such niches, targeting them can be very profitable from square one, unlike targeting general audience with no goal whatsoever. Remember the old adage - try to please everyone and you will not please anyone.
About the Author:
If you're interested in creating your own social networks and monetizing them, see Niche Socializer by Steven Lee Jones and Andrew X.
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