the revenue models associated with online social networks are undefined. i have been involved in the start up of an online community www.capetownalive.co.za – well involved behind the scenes. which actually put me in quite an interesting position, where i was able to view the business as a whole objectively, whilst having direct access to all information and people running the business.it is always a lot easier to look at something from the outside and give ideas, direction & strategic input, than when you are so involved in the day to day running or specifically to online, product development and content management, that more than often you lose sight of the broader vision, and why you are there in the first place.
through continuous observation i came across a couple of things i found left unattended, yet forms the platform of the business as whole. i can understand why this happens, especially in small start ups, where role definitions are unclear and one person is often assigned to several job descriptions.
during the start up of a business i do agree that the most important thing is about getting things done, implementing ideas – but without clear vision, business objectives, short and long term goals, and well defined brand image, how do you make decisions? and without research and market analysis how do you position yourself?, and without involving your consumers to some extent, how do you ensure desirable product development? And of course without systems and processes, even just really basic ones like regular meetings with updated status sheets, project management and timelines, how do you do any of the above?
Perhaps in the first week, everything is in order, but once the ball starts rolling the processes start becoming more difficult to sustain. So what is the solution – basic corporate governance from the start and organizing day to day business like a budget holiday – have fun and enjoy, but make sure everything is well planned,controlled and within budget to avoid getting stuck outside the most beautiful spot on earth with no money to go in:)
Back to online social networks – here it is even more complicated as you have members & clients & high levels of content management, hence the resources and time required to sustain the business is even more tied up. I am no expert, but one thing i have learned in a short period of time, is that with online social networks a clear differentiation needs to be made from the start between clients and consumers, with equal focus on both segments during product development, marketing strategy, brand building and ofcourse – REVENUE MODELS! This basically means that everything is twofold – sales to members, and sales to clients, marketing of product to members, marketing of product to clients and marketing the business/brand as a whole, it is quite a challenging balance to maintain, but without, simply impossible to be successful in operation, not even to mention about delivering a competitive advantage.
Recently i have had a lot of random thoughts about the revenue models associated with online social networks, and my final conclusion is that the only way, or rather one way, of actually making money is to bridge the gap between on and offline. Events ofcourse is one, but beyond that – taking the much loved online brand and delivering offline sustainable products or services under the same brand. I still dont know why i have not been to invited to a facebook fashion show, or own a google gps, or had a quick visit to an online clothing store, or what about a bizcommunity business lounge?? I also dont know why i have not come across an online shopping mall? I have not quite figured it out yet, but i have a feeling i am on the right track…
This post is getting a bit long and random. Oh the inconsistency of it all, the changing colours of the rainbow of life, the brave feeling of letting go and the crystal clear vision of life when you young!