The Power of Social Media

Social Networking is something of a ‘buzz–phrase’ at the moment. Just about everyone has heard of it one way or another – Twitter, Facebook, MySpace and LinkedIn.

From an end–user’s perspective – the attraction in social networking is clear. As the web has matured, its users have grown to expect a more interactive experience. Long–gone are the days of Static HTML web pages where an ‘Animated GIF’ or two was about as exciting as it got! The modern web user expects to be able to interact with a website and other users of that websites – hence the rise in popularity of social networking.

Social Networks not only offer the end–user an ever–changing community to which they belong but the interaction with other people that the human nature strives for.

The web community isn’t a new concept, from the beginnings of the rise in web popularity there were chat rooms, discussion boards and forums – all of which were bustling with loyal followers and we’re in effect mini communities to which the modern social networks partly owe their existence to.

So what about the developers? The multi–millionaires behind the popular social networks. How did they make their millions?

Evolution
The common theme in the rise of many social networks is that they started with a specific goal – but evolved to be something else. While the developers aided this evolution, the change was largely natural. As in the definition of ‘community’, it is very hard to manufacture this – but you can lay the foundations.

By developing the tools that allow users to interact with one another, contribute to the website and ultimately form a community – you are laying the foundations of a successful social network.

Patience and Determination
Facebook is now the UK’s most popular social network and lays claim to over 200 million active users worldwide. Facebook was founded by four students in 2004, who wanted to create a network for fellow students at their university. The potential was quickly spotted and Facebook received investments totaling over US$41 million – however at the end of 2005 it still had a net loss of US$3.63 millon. Jump forward to 2009 and Facebook has over 700 staff worldwide and an estimated revenue of US$300 million.

The message is clear – investment, solid development & planning, patience and determination are key. Facebook didn’t gain 200 million users overnight. However, knowing the potential the platform had they spent their money on developing the tools to help the social network grow organically. When you have 200 million world–wide users, finding advertising revenue to pay for that development suddenly becomes much easier!

Commercial Potential
The commercial potential of social networks is relatively simple. The social network has a target user group – whether it be music (MySpace), students (Facebook) or business people (LinkedIn). These user groups are all prime targets for advertisers. Advertisers are further aided in that the nature of social networking encourages users to divulge in their interests – thus making it easier for the advertisers to collect information about these users fine–tune their targeted advertisements (behavioral targeting).

MySpace was arguably the first major social network to gain mainstream popularity in this country. Originally started as a place for unsigned bands to promote their music – MySpace quickly evolved first into a community of music lovers and then general internet users – and was subsequently snapped up by Fox Interactive Media for $580 million in July 2005. Fox saw the advertising potential in MySpace and the company relies totally on advertising revenue (i.e there are no ‘paid for’ features on the website).

“I still want to develop a social network”
If you have a strong concept and a well-developed plan for your social network, and you are prepared to invest your time, money and patience – then we can help turn your idea into reality…

As the development team behind Champions365.com we’ve seen it go from strength to strength under our development team, attracting sports fans, investors and advertisors alike since it’s intial launch in August 2008. The Champions365.com features the latest Sports News, Fixtures and Results, Blogging Facilities, Media Sharing (such as Video) in addition to common social network tools such as Messaging, Linking Friends and Sharing Content.