The Bankwatch

Tracking the consumer evolution of financial services

Social sites losing popularity with young | FT

As people discuss and debate the business model for social networks, the underlying usage remains volatile at best, suggesting that the determination of the model is a long way off.

Social sites losing popularity with young | FT

“If this trend is true, it would raise questions about the valuation of social networks. It would confirm that on the internet you have to be very agile. One year it is all about search- engine advertising, the next it is about social networking, and something else after that,” said Adam Daum, analyst at Gartner, the IT research group.

Mr Daum suggested that online gaming, which allows people to play remotely with their friends, send messages and chat, may be one of the new areas attracting younger internet users.

Written by Colin Henderson

August 6, 2009 at 01:41

Posted in Uncategorized

2 Responses

Subscribe to comments with RSS.

  1. There needs to be a distinction here. The FT article referenced above is essentially trying to gauge the overall maximum usage of social networks. Let’s not let that obscure the value of social media. It is hard for me to see anyone dismiss the usage levels of social media today. Is Facebook valued too high? Maybe, but that’s beside the point. Social media is a part of the internet fabric, much as blogs like this are an established part of the internet today. There’s no denying it.

    What is more pertinent to this blog and industry are the business ramifications of social media. Can it be used to source customers? Can it help provide better customer service? Should banks tap into social graph-driven marketing? I think the answers to all these questions is an emphatic yes. Just consider this datapoint from the same FT article quoted above:

    “Bebo, a social networking site with a typically younger user profile, saw its UK audience shrink 17 per cent between May 2008 and June 2009, according to figures by Nielsen Online. In the same period, the audience for LinkedIn, a site primarily used for business networking, grew by 63 per cent.”

    Social media like LinkedIn offers corporate executives a valuable, utilitarian tool, not just a handy site for sharing your photos. Business networks — and I would argue, purchasing decisions by consumers guided by what their social networks think — go well beyond the fad-today, gone-tomorrow web app. These are tools that are providing real results today. (We maintain a social network for banking, so we see firsthand the value created by social media-driven information.) Lest you get caught up in the hype over whether Facebook is worth $7 billion or $8 billion, remember that millions of consumers are, and will continue to, use social networking sites in the course of their daily media diet. Ignore this fact at your own risk.

    JJ Hornblass

    August 13, 2009 at 13:32

  2. @JJ .. actually I agree with you. What I meant in reference to the (business) model is that usage by “older” folks brings with it the potential to pay for things, unlike teens who seek free things online (generally). How will 35 year olds and 45 year olds use social, and what will/ might they pay for?

    At the root of my rather brief post here is my nagging doubt about the online advertising model. I continue to believe someone will figure out a wall that allows me/ you/ other users/ to determine if, when and what is marketed to us. Power will shift from blanket marketing to consumers imho.

    Colin Henderson

    August 14, 2009 at 22:39

Comments are closed.

%d bloggers like this: