Tuesday, August 12, 2008

Business Models for Social Networking Sites

As a follow up to a previous post (here) on the need for social networking in sustainability communities, and the potential of social networking on a personal / individual level (here), there are some business strategies that may be followed for growth in this space.

Companies such as Viridus, Celsias, Ning groups, and others need to leverage their most important attribute: their network of users. The challenge is how to grow the network and retain & engage members; without alienating them. Facebook, for example, has growth exponentially; has attracted demographic groups beyond that of the college crowd, but still had a revolt on their hands when they reduced the (perceived) privacy of their users with new tracking applets. They are big enough, so that this was a minor bump in their growth; for a start up, that error could be disasterous.

How do we leverage the community? Here are some revenue building initiatives that may apply in the sustainability sector:

  • Provide market research opportunities to outside corporations (allow corporations to test their brand image; new product releases, or to attract new talent via surveys)
  • Allow targeted ads for user pages, profiles, groups, etc
  • Design for internal use on a company's intranet
  • Set up job posting (similar to E-lance and Guru.com) and job searching service
  • Build in knowledge management (i.e. search, knowledge sharing, virtual communities, groups) and license third party access from vendors who may provide specific content and expertise

One area that intrigues me is building an internal site for a corporation; essentially creating a virtual community of sustainability professionals inside the firewall. The social networking company might also provide access to 'federated' data; profiles and groups outside of the firewall, with voluntary 'opt -in' procedures for users. This would minimize / eliminate any privacy concerns, and also motivate specific users groups to join, if they thought there were advantages to do so (job search inside a company, internal networking, specific content they were seeking).

A key challenge for this scenario would be how to integrate into other KM and intranet systems, so that the social networking site was not a siloed application.


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