I need to get off the social media stump soon, but it’s the one topic of conversation I keep having with people and it’s on my mind.
The statistics for the social media market are staggering. Social media sites are attracting visitors like mad with minimal amounts of effort.
Here are some numbers to consider (thanks to Nateonk):
1. Facebook is growing by 600,000 to 700,000 users per DAY. The site has 150 million registered users today and is obviously growing.
2. Twitter has 6 million users. I love this statistic: 11 percent of Internet users are on Twitter.
3. LinkedIn, the professional social-networking site, has over 35 million users.
I have said this a number of times, but there is a whole generation of people who are turning on their computers, opening their social-media application first, leaving it on and living their Internet day in the application. Just last night I was out with a bunch of social-media loving twenty-somethings, PSOGLE and Meadball. Somehow, I ended up arguing against the power of Facebook and Twitter with these young guys. But they were confirming the points I make every day: social media is incredibly relevant as more and more people manage their Internet experience out of these applications. I don’t have the statistics, but I honestly believe no one under the age of 27 has a @yahoo email address or goes to Yahoo! or MSN. They use Facebook and have GMail. They are “doing the Internet” differently than my generation, and it’s all about social media. It seems like my peers are more likely to live on LinkedIn and Twitter.
So, you would think that this would translate into an entirely new paradigm for Internet-revenue generation, but it doesn’t. The revenue generated from these social media sites just does not come close to their popularity. Everyone tells me not to read Valleywag, but I do and do so religiously. Anyway, they had a post on Facebook’s inability to generate revenue commensurate with their enormous number of users. Do the math and you realize social media might be headed for trouble:
1. Facebook is trying desperately to justify the $3.7 billion dollar valuation and failing.
2. Twitter just has to get bought; I can’t see anyway out for them. They’re going with the old-school Web site model — building traffic now and figuring out the rest later. There have been a lot of posts on how Twitter can make money and none have resonated with me.
3. I have hope for LinkedIn, but I am not hearing much about their revenue.
The net-net: I was asked by Steven Woods from Eloqua: Can social media scale? According to him, the market is growing and frankly starting to dominate, but won’t scale without revenue.