What's happening with the social networking space, as advertising numbers are projected to fall short of expectations for 2008, and overall growth starting to plateau; especially with market leaders MySpace (NYSE:NWS-A) and Facebook?
The answer is the new world we live in of focused interests. I've mentioned for a long time on thealphamarketer that the fragmented market is going to continue to trend far into the future, and anybody that develops any type of Web site that draws a mass audience will eventually have to face the reality of fragmentation.
That's what is beginning to happen with the big, general social networks, and it won't matter how hard they try to combat or hype it, they will continue to slow down in usage.
If it wasn't for international growth, there wouldn't be any growth on the general social networking sites, and that will eventually fragment as well once the new wears off.
The reason why this happens is people only consume or interact with a limited amount of general news, topics, people or information. Once they get their fill of that, they gravitate toward that which personally interests them. That's just another way of saying "niche."
Om Malik said Friday, "The way I see it, the market has shifted its focus onto niche social networks." He's right. It will always happen that way no matter what someone does on the Internet, or in any area of business. The Web portals like Yahoo and AOL have already experienced this, and no amount of behavioral targeting will change that.
What behavioral targeting attempts to do, and wrongly thinks, is if they find out more about those visiting the general site, they can beat or bypass the general information on the site and treat visitors like they're on a niche site. People don't think that way.
It doesn't mean it won't work to some degree, and people won't show some interest, but on a niche site behavioral targeting is for the most part irrelevant, because the niche itself is the marketing tool, and those visiting are already targeted by their interest in the specific content.
I also agree with Malik's conclusion that in the social networking space, people are already moving toward niche social networks, and that isn't going to ever change. The only reason it probably isn't happening internationally yet is because it's just getting market penetration, and the variety of social networks that will emerge from that have yet to be created.
If you're in a country where social networking is just emerging, keep in mind that people will eventually migrate to a social network that interests them, and spend much more time there than on a general information network.
To give you some good insight into the power of building a niche market, a couple years ago I developed a series of blog post on the power of niche marketing. I've included links to the the entire series below for you ease of use. I would highly recommend you take advantage of the information, and learn why it's going to continue to be the wave of the future.
Free Niche Marketing Course:
An In-depth Look at Niche Marketing - 1
An In-depth Look at Niche Marketing - 2
An In-depth Look at Niche Marketing - 3
An In-depth Look at Niche Marketing - 4
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