Snip/Shot by Toddy Mladenov

Will Google Take Over the Half of the Social Networking Market with Google+?

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Yesterday Jason posted an interesting article on the Launch side called Why Google+ Will Take Half of the Social Networking Market from Facebook, in which he points out six reasons why he thinks Google will be successful with G+. While I agree with some and disagree with others, I thought it would be nice to get my view of the future.

Google Will Take Over the Whole Social Networking Market

How about this? Google has the potential to take over the whole Social Networking Market! Yes, this is absolutely possible! We have already seen this happen with MySpace and Facebook ($35M vs. $80B). And we have seen it Google doing it at the beginning of the century. But the keyword here is “potential”! Whether this will happen or not only time will show, but here is what makes me say that they have the “potential”:

• For the past 10 years Google has dominated the Web with their search and services. Although the prediction is that search will plateau soon it is still growing and Google has the lion share of it. More searches means more users, and more users means more potential.
• Google knows how to get users on their platform. Take for example AdSense, or Gmail, or Google Docs, or Analytics. All those services had tremendous success, and continue to do so. Although they had some failures lately with Waves, Orkut and Buzz they still have the potential to create good service.
• Last but not least, Google has the money to compete. With $30B in revenue and $8.5B in net income in 2010 they are ~15 times bigger than Facebook (with their estimated $2B in revenue and $600M in net profit – see Facebook 2010 profit? Try $600 million on MSNBC). What this means is that they have the luxury to try-and-fail much more than Facebook.

 

What Does Google Need to Take Over the Social Networking Market?

Yesterday when I logged into Google+ my first reaction was: “It looks exactly like Facebook!”. The UI, the wall, the profile – absolutely the same. Then I discovered the circles: “Yeah, this is useful!”. But couple of new features, few UI improvements (honestly Facebook drives me crazy with their UI) and better control of personal data will not drive adoption of Google+. Things that will though are:

• Get rid of the invites. People read all over the web that Google is releasing their “new” social network, and are excited to see it but if the only thing they see is “Check back later” they will either forget about it or will be VERY disappointed to see that it is “just like Facebook”. This worked well for Gmail but there was an significant advantage over other web based e-mail services  - it was offering tons of space FOR FREE. The same with Google Docs and Analytics – it was offering the same functionality FOR FREE. Facebook is already FREE, and this cannot be differentiator in this case. Keeping it closed will not increase the desire (like the Gmail case) but may fade out the curiosity.
• Add additional value to my social graph. People are already sharing links, pictures, and videos. Nobody needs one more service for that (although from Google). What else can Google+ offer the users that Facebook doesn’t offer yet, and that will make them switch (or at least use both)? Hangouts? Not bad! But is that all? I am not giving suggestions but I am sure there are tons of things that can be done here.
• Integrate with the other social networking services. I am sorry Google, but even Facebook integrates with Twitter and LinkedIn (and doesn’t just have links to those in my profile)! I know it is hard to overcome the feeling that Facebook will “own” your data but if you want users you better do it. We live in an interconnected world, and keeping my data for yourself (i.e. living in your own box) may not be the right strategy. If I am willing to share it with you I will be willing to share it with others too or not share it at all.
• Make it easy integrate Google+ on third party web sites. Some people will say that this is following Facebook (and Twitter), and my answer is: “Yes! You are already a follower! Get it out ASAP! You know already how to do it!” Google+ buttons started appearing on the web sites but if Google doesn’t allow developers to build on their social platform (think Zynga and their contribution to Facebook success), and if they keep it closed to Google properties only their “success” will be limited. If Google puts G+ in users’ faces on every web site then they will start using it (somebody remember AdSense?).
• Roll it out on every mobile platform. Don’t tell me that Google+ will be available only on Android phones! There will be two more years before I buy my next phone, and you are very optimistic if you think this will be an Android phone. And this is the case with… lot of users around the world. Even if IDC predictions are correct there will be still 56% of mobile users who won’t use Android in 2015. Are you willing to give up this market?
• Improve my experience on the web. This is the area where I think Google can go the extra mile. With billions of users who search the web every day, Google is the best positioned to make a difference what content users consume, and eventually how do they consume it. But wait! I know what you are thinking – you can use my Google+ data to improve the search results on the web. Do that but for MY OWN search results. PLEASE, don’t use my Google+ data to improve the search results for other people (even my own friends) – I really don’t fit into the statistically representative sample, and this will totally screw their results.

 

Will Google+ Really Take Over Half of the Social Networking Market?

I doubt! 20% – yes! 30% – maybe! 50% – I don’t think so! Why? Here a few reasons:

• Company size – Google is to big and too slow to compete with Facebook. Why it happens all over again and again? Microsoft did it 20 years ago with IBM; Google did it with Microsoft 10 years ago; guess what? Facebook will do it with Google now. It is always some small company that takes over and rules for a decade until it grows so big that politics and talent attrition start eating it from inside.
• User perception – Google brand is not associated with social networking. With the rest of the web – yes, but not with social networking. Here are my associations:
  • Enterprise == IBM || Microsoft || Oracle || SAP
  • Desktop == Microsoft
  • Web == Google (think search, services etc.)
  • Social Networking == Facebook
    
    Somehow anyone of those companies fails to move into any of the other areas. I am not saying it is not possible (think how Microsoft entered the Enterprise space) but I guess you get my point.
• Age – Google is too old to understand the new world. Companies are like people – the older they get the less risk they want to take and the slower they move and think. It is harder to get an older person out of their comfort zone, and this is happening with Google employees – those are people who lived through the Web ages; they understand the Web, and know how to control it but they don’t understand the Social Networks and don’t know how to control it (or how to let it loose).
• Too many things on their plate – self-driven cars, anyone? Google is trying to do too many things that are 1.) not in their competence and 2.) distracting them from the market.

 

It is all predictions; the range is from 0 to ∞ (infinity) and Google has its fair chance to take over as much as it can. As an early adopter I will be using G+ but if I don’t see additional value soon I may as well forget about it.

Do you believe your Klout score?

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Last week I had the chance to participate in the #smmeasure Twitter chat about How to Measure Influence with special guest @meganberry from Klout. I have looked at Klout a while back, didn’t spend too much time at it but this chat made me curious again. Ok! It seems my Klout score is the holly grail in the Twittersphere; the thing that determines how influential I am on Twitter (or is it my overall online influence as Klout claims?); and the thing that everybody on the chat claimed is the ultimate measure for influence.

 

Of course all the talk about the Klout score touched on my selfishness, and I loaded the site to see what my score is. And as you can imagine it was low - to be exact it was 9 (nine). My first thought was to compare myself to people like @joelcomm and @guykawasaki (I didn’t remember the twitter name of that guy... what was his name?... aaah, Ashton somebody :P to check his score). If @joelcomm has score of 44 and @guykawasaki 87 then I am proud with my 9. Just continue tweeting and soon I will be 10.

 

In general I don’t like numbers that I don’t know how to get to, and looking around the site didn’t help me understand how my nine is made up. I almost left the site when I noticed something interesting. A friend of mine (@laerjael) who I used to tweet a lot to 2 years ago had Klout score of 12. That really made me jealous. Why? Because I am bad person, and I hate her? No, really! Because her last tweet is more than a year old, because she has 47 followers (I am one of them) compared to my 800 at the time, and because... yeah! because she has higher score than mine. How come? At this point of time this became a matter of dignity. I had to find out why my score is lower than hers.

 

 

 

Although reluctant (I didn’t want to allow yet another site to be authorized to read my Twitter streams) I signed in, and started digging into how the score is calculated. The description provided on the Klout web site had no explanation how from the 25 metrics they use one can calculate my score. Nothing bad with that - they have their secret formula, and one day they may become Coca Cola. But the next thing I discovered was that my Klout score is calculated ONLY if I implicitly request it to be calculated (read, you need to push a button); if you don’t do that it is some bogus number.

 

Here are few of the questions going through my mind:

• My first thought was: Can I use my Klout score to compare myself to the other Twitterers? I don’t think so. If people need to go and manually push a button to get a number, the odds are that only small fraction from the 145M Twitter users have done that. Hence if you want to compare yourself to somebody else, how do you know that his or her score is fresh? You are comparing something in the present with something in the past without taking into account any changes that happened in between.
• Second: What the number actually means? It is clear that higher number is better (as always:)) but is this a percentage or something that I can relate to? As it came out the answer on the last question is NO. Having a Klout score of 65 doesn’t mean that you are more influential than 65% of the people on Twitter, or that you can influence 65% of the people online. Then what is the point? Why the score is between 0 and 100? Why not between 3 and 65? Or between -17.3 and 12.5? Absolutely no idea! It is some number that I don’t know how to interpret.
• Klout claims that the score they give you is the “measurement of your overall online influence” - What does “measurement of your overall online influence” mean? Does that mean that X% of my followers will take action on my tweets? Or that I can influence only X% (or just X) of the population online? And how they get the “overall online influence” if they only collect data from Twitter? How about blogs, or Facebook (that one they may actually do if you add your Facebook account), or MySpace, LinkedIn and all the other thousands of social networks available around the world?
• Last but not least: Why a person with True Reach = N/A, Amplification = 0 and Network = 0 has score of 12? I really have no answer on this one except that maybe the Klout score is just a random number that you get assigned in order to feel better or worse about your twitting. By my standards, if somebody is not tweeting for more than a year he or she should have automatically score 0 (sorry @laerjael!)

 

I have to admit - I clicked on the refresh button, and my score jumped from 9 to 25. That made me feel much better but I am still confused how to use this number. I checked again few days ago and the number was still 25. I was wondering whether I should refresh it again or whether this will happen automatically once it is kicked. Being in the software business I was pretty sure that this feature didn’t make it, and I looked more thoroughly for the refresh button. Took me a while to find it but the reward was well deserved - now my Klout score 36. I didn’t do something really different in the past week - I continued tweeting the same way as before. Yes I got few more followers but still... My Klout score sounds me as the useless KPIs that I see quite often on the score cards. Yes, we got the number but what is the action that this number triggered?

 

Twitter's Business Model - My Take

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For a while I was hearing people say: “Twitter has no business model!”, or “Twitter cannot monetize their service!” but it seems that something changed lately. All started with the rumors that Google will buy Twitter few months ago; then talks that Microsoft tries to estimate the value of Twitter; and now – Twitter is trying to get into the search business.

 

Surprise! Twitter tries to make money by himself. Jackie Huba posted Twitter & advertizing, part 2 almost two months ago and her post is inline with what I was thinking about Twitter and how they can make their service profitable. The part that I don’t like too much is that every online business (including myself with this blog:)) tries to make money from advertisement. There is nothing tangible behind the advertisement! There is no value for the user, or customer who sees the ad! Unless… the ad is relevant to what the user is doing at the moment.

 

In all the cases Twitter can monetize their service. Even with the old technique called “buy me because I am cool”. We’ve seen big companies doing that a lot while the economy was booming. Soon this time will come back and Twitter will be in good position.

 

Until then I bet that Twitter is going to follow the ads model with their recent investment in search but here are my advises for them.

• If Twitter goes with the ad model then I would like to have the ads non-intrusive and relevant to what I tweet about. Also, their ads should follow the tweets model – no more than 140 chars (or even less), and no more than 1 ad per tweet. If this will be the way to keep the service free I think lot of people will be fine with it.
• This one though I like more: Twitter has the power of information – news, trends, opinions… everything you can imagine is discussed there. This is what Jackie means in her post above. But there is more to it!
  
  What about surveys? Right now the influencers run free surveys among their followers. Twitter’s own account has more than 1 million followers – this is much bigger representative sample than most of the surveys done by the research companies.
  
  Trends is another one. Products and companies are always discussed offline and online, and Twitter is one place where this happens a lot. If companies plan to run for example marketing campaign they can partner with Twitter and monitor the reaction from the beginning till the end – what people’s perception is? Do they accept it? Do they reject it? Etc.
  
  News. Great example is Mike Wilson who tweeted during Continental Airlines crash in Denver (for some reason US news sites are not among the tope ten results for this search:)). Twitter can be the new CNN – they can create news channel (and of course serve adds there:)) and serve the news before everybody else. Also, keep in mind that more and more news are created and recorded by normal people and not journalists (9/11 video recording, Concorde crash etc.)
  
  Product reviews. If Twitter is able to get a sense for the sentiment for particular product they can provide this information back to companies or create review channels people can subscribe to.

I can go on and on with even more ideas but you get my point. Information is powerful – you just need to find good way to deal with it. Google became successful because they found a way to index the information on the Web. Right now Twitter is big bucket where everybody throws information and the first one who finds a way to organize it will become profitable.

 

But Twitter needs to be also careful. Twitter is great platform that allows third parties to build on top of it. Whatever monetization model they build they need to make sure it propagates to those third party applications – else, what’s the point? How many of you go and update your status from Web? And how many from TweetDeck?

 

P.S. And if Twitter takes one of my ideas above I hope they will remember where they read about it :)