Milking Social Media for Moola
by Claire Le Grange on 2009/07/09
Debates are raging all over the Internet on how to make money from Social Media, whether free content is a sustainable business model, and just how big a slice of the pie Digital Media will get from total advertising spend.
Forrester Research's Interactive Marketing Forecast estimates that social media marketing will increase by 34% over the next five years to $3.1 billion by 2014. This estimation gets a thorough disection by Patricio Robles on the Econsultancy blog. His conclusion, "Almost all of the $716m Forrester sees being spent on social media this year will be attributable to Facebook and MySpace".
The facts and opinions may contradict or disagree with one another, proving that no one has the solution to monetizing the web. However, it hasn't stopped people from trying to find an answer, even in the face of imperious Social Media giants like MySpace and Facebook.
The latest development is Tweet#ROI - #Return On Influence.
Described by some as a type of affilliate scheme and as a Twitter version of AdWords by others, it has received a mixed welcome. The creators have positioned it as "a recommendation platform where marketers and influentials could meet and exchange financial capital for social capital".
Concerns have been raised that being paid to communicate an opinion degrades the integrity of your voice. There certainly is potential for this. Should a twitterer become a prolific megaphone for advertisers, their reputation may bear the brunt, even as their wallet grows fat.
Notably, developments like this truly highlight the value of your online reputation. As the name of Tweet#ROI suggests, return on influence, your online reputation is the currency that will determine the value of your social capital.
Comments
Brian Carter on 2009/07/10
Thanks for talking about TweetROI, Claire :-) To clarify, TweetROI has an affiliate program, and bidding is advanced like AdWords- you can bid on tweets according to the influence of the tweeters- you pay more for more influential tweeters. As far as reputation goes, I don't know- did Paul Harvey's rep suffer for promoting products? What about the athletes on the Wheaties box?
Claire Le Grange on 2009/07/13
Hi Brian, thanks for leaving a comment. I think it is important to look at the context. Celebrity endorsements are typically seen as advertising. Endorsements through Twitter should not be seen as advertising - it removes from the organic, honest and unscripted nature of the conversations taking place. One of the reasons I signed up for a Twitter account is to stay connected with my friends and colleagues and share information. My reputation is affected by what I communicate. What advice would you give users of TweetROI to ensure they retain a balance between endorsements and their normal Twitter use? In other words, how would you respond to a Twitterer who only tweeted endorsements? If we look at the nature of Twitter, do you feel that they would undermine their reputation in the Twitter community by doing this - and thus be ineffective as a TweetROI member?
My main concern here is how to retain an equitable balance, as the reputation of a Twitterer, the quality of their tweets, and their subsequent value to TweetROI are all fairly interdependent.
Brian Carter on 2009/07/13
Ya, I wouldn't like a Tweeter that only did ads... I would unfollow them, and suggest you do too.
Brian Carter on 2009/07/13
Sorry for the short comment before- had to run into a meeting. I think no more than a few paid tweets per day for a real twitter account- I update 30-50 times per day and I wouldn't want to put out more than a few a day. But it also matters how relevant and useful those tweets are- if I put out an ad for the SES search conference, that's relevant and useful to a lot of my followers, so it's not just me getting paid. It's part of the useful nature of my tweetstream.