Myspace.com is a pioneer in the social networking website space, but we are seeing it slowly move out of this space especially with the huge competition from Facebook in the past 2 – 3years. I was wondering how could a website which had a market share of over 80% in US just lose traffic, there has to be some basic learning which we should take out of the Taylor curve( Not exactly taylor yet) of this social networking site to understand this transition of the website.
The strategy adopted by most of the social networking sites have been like Mark Zuckerberg says– “Growth is primary, revenue is secondary” The model has been working for facebook from a growth point of view where Facebook is doing great but its high time that they start looking into the revenue bit, its really unbelievable that a company with over 200 million customers is not generating profits. But in the case of Myspace the issue has not only been from a revenue point of view but also from growth point of view especially considering the fact that they have not been able to leverage the first mover advantage in this space.
Problems Myspace had/has
- User Design – There is a very nice post on the problems with Myspace design http://carsonified.com/blog/features/design/the-myspace-problem/
- Lack of stickiness factor
- Unable to crack any new models for advertisers unlike FB which keeps innovating( though not all work) but the fact that the company is doing things to keep the community engaged in its portal has been the key
- Architecture of FB applications has been a killer and myspace was a slow mover in terms of releasing API’s for external websites to connect up. FB connect is now more far reaching in that aspect
- Differentiating itself in the social network era
What are they doing?
- Myspace Music – Its one of the most wanted properties in Myspace now, especially because of the tie-ups with some good records
- Entry into Music is a great opportunity for Myspace to tap into a Niche of Social Music Community, which can be a potential growth multiplier
Now what about Monetising? Here is an interesting snippet on Myspace :
Numbers also show it clearly that the key is to crack the monetization for these networks. Innovative Ad models always seem to be the way ahead, but a transaction i.e. social commerce led model will definitely be something to look out for.
So, How do you think they will be get out of the crisis or have they already cracked a way to get out? Is Music going to lead it? Or something else?