Monetizing Social Media, Oh And Coffee

Sorry for the long absence, I've been trying to balance my time in the last few months given a new job, which requires me to wake up at crazy, unheard of hours (well, for me). To avoid the potential rainfall of scorn, I will abstain from providing details as to what that specific hour may be.

The job is going well, thanks for asking, I'll provide more details in the near future should things work out as expected. But first, a few updates:

• We failed at dodgeball, being unceremoniously kicked out in the first round. C'est la vie! Due to us being lazy we've lost our spot for this season as well. Sad.
• I may be getting back into some midnight ice hockey, which is a great way to both re-live my early 20's, and presumably have my body remind me that those days are long gone.
• I am now on twitter, I have no idea why.
• Pagination (Node) is now at version 1.5

Monetizing Social Media

I wish I saved the link I was looking at a few weeks ago, alas I can't seem to find it. A random tweet brought me to some data on CPM rates for social media sites (in particular, Facebook). The basic summary was that CPM rates were lower on such sites than within "traditional" sites.

While I wouldn't at all consider myself a web advertising guru, I've always been a bit wary of advertising as the sole or primary revenue source. It seems there are many more failures than success stories of products/sites/companies that relied on advertising in their business model.

In regards to lower CPM rates, however, I can't help but think that mindset has a pretty large role in explaining the discrepancy. I'm acutely aware of the whole "the plural of ancedote is not data" meme, but regardless, when I'm wasting time on Facebook, it's for the purpose (well, usually) of keeping up with random friends and contacts. I'm not particularly interested in buying anything, or even thinking of any specific product or service, I'm just looking for the wittiest status message, or a goofy image to comment on.

Furthermore, the whole idea of targeted advertising while I'm catching up with people creeps me out. It's my private time, and I'm not interested in some random ad server trying to sell me on things my friends are doing.

Comparatively, when I'm trolling my usual collection of daily sites, with the intention of learning something new about random technologies and products, I'm pretty open to ads that could be relevant to my current mindset. If I'm searching for optimization tips for Drupal or MySQL (for example), you can bet I'd be interested in proven solutions.

Does that fully explain lower CRM rates for social media sites? Perhaps just for me! I can honestly say I've yet to click on an ad from within Facebook, primarily because, I'm just not in the mindset of searching out that sort of thing.

Fair enough, you say, but what about social media sites that are built around something more specific, such as a band's community, or avid fans of 10 pin bowling? At this point, I think you'll agree with me that the social media aspects of the website are not the main draw, it's merely a tool to support the actual product or service.

Which I guess illustrates two thoughts I had recently regarding this. One being, simplistically, that you still need a strong product or service (hopefully not a surprising conclusion), and two, that perhaps social media is really more of a supporting feature than a primary draw.

I think of it like the little struggle coffee shops were going through a few years ago, when the idea of wireless internet while you enjoyed your daily fix was seen by many as an additional revenue stream. Nowadays (at least in my locale), it seems just about every coffee shop has free wireless internet, and those without are losing out on potential customers. The idea of paying for wireless internet at a coffee shop seems odd, and rightfully so!

Anyhow, it's been interesting to see businesses embrace social media, and seeing the stutters that come with any sort of exploration into a new area. I'll tangentially continue this topic in my next post on Single Sign On, although it'll be more of an excuse to rant against application interoperability...