Popular social media sites like MySpace, Facebook and YouTube are appearing everywhere over the Internet, buzzing with people who want to make personal connections, business connections and political connections. The direction of Web 2.0 is accelerating quickly towards social media and the phenomenal impact that it has on media relations and business.
Social networking sites are striving daily to become well-respected members of the media world and in many ways they are, although a few isolated incidents can give them a bad name. For example, social stalkers on sites like FaceBook and MySpace can discourage people from becoming members and exploring other business-related opportunities that the site can offer. In addition, the never fail multitudes of get-rich-quick schemes that clutter the average business person’s mailbox is also enough to make them (possibly) not want to sign up with sites like Sphinn and Marktd. If the average online entrepreneur doesn’t persevere and muddle through the distractions, they cannot see how much their business can benefit from social marketing and networking sites.
Twitter, an extremely popular and fast growing social networking site, in a news interview decided that they would not concentrate on monetizing their site. Instead, the owner, Biz Stone, decided that it would be in the best interest of the company to continue providing exceptional service to the micro-blogging community and worry about site monetization later.
“At this point, given that we have plenty of money in the bank, it makes a lot more sense not to distract ourselves with trying to put the finishing touches on a revenue plan,” says the 34-year-old Stone, who founded Twitter with Jack Dorsey and Evan Williams in 2006.” Full Story
Popular sites like Twitter need a business model and a revenue plan, don’t they? Are businesses going to start cropping up across the Internet with no public plan of action, no business model, no advertisers, no revenue model and no foreseeable way to continue doing business on the Internet? These questions have many bloggers baffled because in the world of blogging and content creation, there must be a way to sustain the business and that’s generally tied to a revenue stream. Advertising, product sales or course tutorials are some of the strategies that sites use to bring in revenue and keep their sites alive. Twitter currently does not do any (blatant) advertising, doesn’t charge members or participants, they don’t ask “sign-up” fees or referral links and the only way you hear about them is word-of-mouth. Yet, they are one (if not only) of the most powerful forms of social networking available today. The site is quite addictive (perhaps their strategy) an d easy to use because the platform only allows 140 characters maximum per blog entry. Links also count as part of the 140 characters so there is limited space to say what needs to be said. That’s the beauty of the system. You can deliver a business blurb, marketing link or re-direct people to your site in brief, succinct communications and make a profound impact. But in a business sense, it just makes sense to make money from something that is 1) growing, 2) widely used, 3) popular and 4) in demand. If Mr. Stone is not interested in Twitter making money, what is his goal?
Everyday, online companies strive towards achieving the type of traffic and following that Twitter has garnered. If they could secure half or even a fourth of the organic traffic that Twitter reigns in, do you think companies would pay for that opportunity?
Twitter provides a weekly statistical data on their current usage and member information. As of this date (August 4, 2008), Twitter shows that it has over 200,000 users and sees over 2,000,000 tweets per week. (Statistics)
After reading more about Biz Stone and the premise of Twitter, I can only speculate that perhaps Mr. Stone will present to the Twitter community at a much later date a business model and plan that will be so impactful and powerful that we cannot resist partaking in it, whatever that will be. Will we be charged for its use later? Will large organizations “sign-up” to allow their tweets to go out to the masses, touting their product or service? Will the average entrepreneur be able to have a twitter-page where they can showcase their wares while paying Twitter a small fee for the honor? Who knows what will happen. One thing for sure though is that Twitter has definitely developed an interesting way of doing business. If this future plan is well-developed and presented effectively, I would imagine that Twitter could invariably double or even triple its size in traffic and growth. Businesses will start to flock to the Twitter band-wagon to enjoy its successes. In the end, Twitter will have firmly been established in the social media circle and become a pattern for other sites to follow.
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