A chief event of life is the day in which we have encountered a mind that startled us.Ralph Waldo Emerson
Yes, barcamp is back. Today I attended Barcamp6 held at MDI Gurgoan. This is my 3rd barcamp and I would like to thank organisers for this well done event.
Reaching MDI was not a problem (as I tought it might would be) as DTC bus droped me just in front gate of MDI. Arrangement was good except that we had very few chairs in hall 1. 100 something people turned up for the event. As always we had assorted audience including blogger, hackers, techies, geeks, educationist, lawyers, invetors, bankers and wannbe entrepreneur.
I attended many sessions. First one was on scaling web application by Directi guys. It was very comprehensive and and useful. Second one was on Open source software development by Mir Azim who is a runing a 8 people startup called iKraft Software from Srinagar. He shared his experience on how to pitch your open source software company to your client. Very useful session. I do attend other sessions but I had to skip part of them to attend other session runing in parallel. I listen to Depeek Shenoy’s views on recessions. He looked very pessimistic about current financial situation.
I got opporttunty to talk with Amit Gupta product manager at Makaan.com a real state classified portal. We talked on possiblities of innovation and delivering complete real state management services to end users.
But what impressed me most was this gal Rashmi Gupta. She is 3rd year ECE engineering student She came from Patiala to attend this event and to get inputs for her startup flyingminds. Full of enthusiasm, passion and energy she shared her startup ideas with us and we had a very interactive session on how she may go about executing her idea. I was companied by Avinash (mind behind Routeguru) who shared his views on same. As I said earlier in my OCC meet post this is a huge change in attitude of indian youth who no longer looking for safe harbours and fat salary and is ready to take calculated risk and exploring his/her own ideas. I wish her good look for her venture.
Social networks are plenty and in past few years they have grown both horizontally from dynamic user groups to platforms and vertically from social networks for gays and lesbians to invitation only groups for social elites.
Social networks are hugely succesful in India too. According to latest data from camScore indian social networks have grown 50 % in the year 2007-08. Moreover majority of web users are now social networkers.
But despite this phenomenal adaptation of SNs idea , social networks are loosing more money then they make for their investors.
This post is my attempt to understand the whole social network monetisation problems and related issues.
Social networks are used as marketing and branding media and make money through advertising same way as TV, Radio, Newspaper does. This way advertisiding drives the form and functions of social networks. Social networks have to cater needs of two different parties, the actual user, who want to use them as they wish to with minimum interference from anyone incling owners and advertiser who pay for runing the show and what users to behave in curtain way. This create a disconnect between interest of parties involved and there a contest going on between user and advertisers where social network trying to balance the needs of both parties.
Social network are new kind of media in advertising industry and do not enjoy same level acceptence and trust among media buyers as enjoyed by TV & newspapers. They are yet to prove their effectiveness and metrics used to evaluate thier effectiveness are evolving.
Other challenges involoved in monetizsing are related to very nature of social network. For exampl most of the network rely on user generated content where social network have very limited freedom to play with content. Most of the user activities are action oriented like writing on wall, poking friends, sending sms and hence provided little space for text/display adversting model. Users are agnostic to any significant changes in social network structure and forms done to suit the needs and requirements of advertisers. Attempts to sell/use user information to third party resulted in backlashs and there is increasing awareness among users about privacy related issues. Many user privacy watchdogs are seeking change in privacy policies of social networks.
Below is more detailed analysis of two major issues related to monetisation of Social networks.
1. Low CPM or Unsuitable metrics – CPM may not be the best indicator of social network analysis
Lookery, an ad network specializing in social media, offers display ads on MySpace, Facebook, and Bebo for only 13 cents per thousand times the ad is served (CPM); Yahoo’s average CPM is estimated at $13. Video ads on MySpace reportedly fetch just $25 per thousand showings; CBS charges $50 on affiliated sites, NBC as much as $75. (Source)
Next question will be is why SN have low CPM . The reason is that most social network reply soley on advertising revenue.
Regardless of the model (CPM, CPC, CPA), advertisers value three key measures: reach, frequency, and targeting. Many social media sites certainly score high on reach and frequency, but how do they fare on targeting? Targeting is key, because it determines the CPM rates advertisers are willing to pay. And CPM rates vary very widely: from $16-20 for TripAdvisor to $0.10 for Facebook and MySpace. See, for example, this media plan. (Source)
There is another dimention to low CPM for social networks which is quite counterintutive.
The assumption is that if users are worth money, then more users are worth more money. Theoretically, an infinite number of users are worth an infinite amount of money. It’s simply not true.
There is a point of diminishing returns in Web advertising. Enormous traffic creates a glut of inventory, which inevitably drives the value of ads down. The most highly valued inventory on the Web is branded, high-quality media content. It’s valuable because the content projects value onto the advertiser. When Target advertises on MTV.com, the brand benefits from MTV’s youth-oriented content, giving the brand a youthful shine. In contrast, utility inventory lacks the compelling context that advertisers need to help build identity and image, and in many cases may include negative images. The result is that advertisers have no cause to align their brands with products like Social Networks. Unlimited inventory and negative brand association is a perfect storm for low CPMs.(Source)
Extra : Here is interesting explanations and maths that is involved in calcauting CPM
2. User behaviour
Both social network & advertsier would like to use datamining techniews to target there advertsing to improve their CPM . But this leds to problems related to privacy fo user information . User behaviour give different challenges to social network. On social networks, people are primarily concerned with communicating with their friends, not looking to buy items or services. Moreover when marketers try to shake things up, users don’t take kindly to major changes. There are issues related to trust and privacy of user infomation and this lack of trust is mutual.
the fundamental problem that social networks face when trying to monetize through an advertising-driven business model is the lack of trust. To be more explicit, while brand advertisers have historically trusted people as consumers, they do not trust them in the new role of producer (e.g. uncontrollable content). Likewise, people who are armed with the power of interactivity are also demonstrating that they are increasingly distrustful of brand advertisers (e.g. ad-skipping).(Source)
I come across few exellent presentations related to subject. Here are two of them
In the next post I will look for solutions that are been tried to resolve problems mentions above and will do some analysis on how successful are they in generating revenue for companies. I would also like to cover indian social networks are trying to resolve monetization conundrum
Its a well known fact that social web and web marketing and played significant role in promoting Obama as a change leader. Taking hint from his campaign success our politician are gearing up to use social media to woo voters and to reach masses with major political parties all set to spending good amount of public money on web.
But was it just new media that helped Obama be a winner ? Will change in media will help if the message itself is stale and unconvincing?
In case of Obama I think is that its was much more then the new media. It was about of telling a very convincing story. It was about selling a convincing vision of a strong and constructive America. It was about hope to bring positive change in american politics. Internet was just another media to reach people and was not the message itself.
Coming back to our politicians I have few quetion to ask to Mr. L.K Advani :
a) Whats your message and how is it different from from what you told last time?
b)Why I trust you?
If its is same boring raath yatra brandished hindutava based politices I doubt social media will help you win my vote.
Meaasge must be tailored as per audience expecations. Citizen of net in india are young, educated and informed people.They will never buy bullshit you soled to naive indian villagers.
So Mr. Advani if you really want my vote tell me something new and different.Tell me something bold, original, positive and progressive. Tell me that you will have 30 % more younger politian in cabinet then opposition had. Tell me that your party will not give tickets to any one with criminal background. Tell me that even if you dont win you behave like a mature opposition party. Tell me that its not about hindu or muslims but about India. Tell me that you will not talk about 19th century crap to 21st century Indian and help us to lok forward. Please tell me that you will give real competition in political ideas and innovation to Congress. Just tell me something convincing.
I dont know. I was listening this very beautiful song from movie Delhi6 on youtube and I find this comment
Prasun joshi stole this song. This is a folk chhattisgarhi song. It was the composition by late Gangaram Shivare and the singer was Bhularam yadav of this folk song. Later on Ramadutt Joshi, Dr. Rekha Joshi and Prabhadutt sang this folk song in 1970. Shame to Parson Joshi and Rehman – you even not thanked the real artists of chhattisgarh.
Commenter had done his homework as has given all the right infomation required to verify his claim.
Song is really cool and if you have some countryside experience you will definitely going to like it. When I listened this song on Meow FM station I immediatly google it to find more about it. For any lyrist to write such lyrics you not only require amazing creativity but also should have deep roots and first hand experience of indian culture. I was quite surprised when I find that songs’s lyrists is Prasoon Joshi ( for composer I guessed it right i.e the one and only A.R rahman). But for lyrist I was expecting Gulzar or Javed. Then I googled for Prasson Joshi ( baal ki khal nikaalney ki purani aadat hai ) I didt get much about his background and I made note to follow more of his work. I was very much impressed.
And today I read this comment. I am not sure how true this comment is but I am just wondering what if Prasson turn out to be yet another Anu Malik.
On this valentine’s day I dedicate this song to my my sweet , cute n lovely dreamgal ….for making everyday of my life a valentine’s day.
My funny Valentine
Sweet comic Valentine
You make me smile with my heart
Your looks are laughable
Unphotographable,
Yet you’re my favorite work of art
Is your figure less than Greek?
Is your mouth a little weak?
When you open it to speak, are you baby, are you smart?
Don’t change your hair for me,
Not if you care for me
Stay little Valentine, stay
Each day is Valentine’s Day
Baby, don’t change your hair for me
Is your figure less than greek?
Is your mouth a little weak?
When you open it to speak, are you…Baby, are you smart?
Don’t change your hair for me
Not if you care for me
Stay little Valentine, why don’t you stay?
Each day is Valentine’s day
(scat) doo wee day
Every day is…
Every night is….
Every day..ooh ooh…
And this song is dedicated to you, myfriends and Myself
I never tried drugs but I doubt they if they could be as intoxicating as talking with a bunch of passionate wannepreneurs ( wannabee entrepreneurs) and hackers on a lazy Saturday evening.
Ok, may be that was a little hyperbolic analogy , but I think it very well sumup experience I had in OCC meet last Saturday, where I joined 7 other wannepreneurs to talk on topics ranging from busines model in startups to startup ecosystem in India.
First thing that draw my attention was the confidence and enthusiasm displayed by first year undergraduate students (Akhshay and Apoorv). I was impressed with their strong understanding of web and passionate interest in startups ( doing own stuff , own way) . There is a revolutionary change in the attitude of young graduates. At my time the only objective of graduating candidate was to work as hard as possible to get straight A’ ( a honors degree to be precise) and then hunt for highest paying ‘MNC’ job. At that time nobody even talk about doing startups. And here is these guys talking RoR and startups in the very first year of ther graduation.
Another thing that I find rather unique and interesting was their agnostic attitude toward ‘business’ part of startup. They were representing first crop of true indian hacker who love coding amd creating cool programs and who are least bothered about job or money. This herald a sea change in Indian startup ecosystem in next couple of years.
We were join by an veteran entrepeur from Nepal , Ujwal Thapa, who is managing his web business in Nepal from past 7 years. He is looking for partners to expand is bussines in Delhi. Talking like a sage he kept conversation grounded and shared some really inspiration stuff on entrepreneurs and entrepreneurship.
There were three guys who left there secured job this month (yeah you wanted to know if this is the right time to start a venture. Now you know, it is ) to start their venture. Ajay and two of his friends are all set to start a new venture in real estate domain. Atul is looking forward to do a startup in education domain.
Quotable quotes:
“Entrepreneur are crazy people. We do not do stuff just for money. We do startups becoz it is the only thing we understand and love doing. Nobody understand this including our family and friends.”
Ujwal Thapa
“Life is short and we live once so lets do things we love. ”
Ujwal Thapa
“In internet business we first build product and then build business around this. This is how facebook got created “
Apoorv Khatreja
“Business main thoda baoot compromise to chalta hai.”
Atul kumar Bucha
“Indian startup community is growing at very fast rate specially in banglore. If you have right idea and right team you can get angel and VC money”
Ajay Yadav.
“You can start a business with passion and idea. Money may not come into mind as motivator. But when you have 100 people working for you and who depend on you and your startup ’s survival, ‘business’ part of startup kicks in”
Manish Malik
“Why you are so much into money and business. lets create stuff we like. Business will come later”
Akshay Gupta
Venue : CCD (in front of sindhia house) ,Connaught place Delhi
Date & Time : 31 Jan 4.30 – 7.30 PM
Agenda : Indian startup community, Web (business +models)
) I didt get much about his background and I made note to follow more of his work. I was very much impressed.
) to start their venture. Ajay and two of his friends are all set to start a new venture in real estate domain. Atul is looking forward to do a startup in education domain.
