Making money
(by a guest writer)
There are a two main ways of harnessing social media to profit.
1. Earning money off a traditional site - via contextual ads,
affiliate programs, sale of goods etc. and using social media sites to
a) generate traffic directly to your site and
b) enhance your position in search engines.
2. Earning directly off your involvement in the social media
sites themselves:
a) "ethical" methods from using your Amazon affiliate link in your
Squidoo lens to competing for prizes at youtube video competitions
b) less "ethical" methods such as selling your myspace or propeller
account after amassing lots of friends.
Before I come to the two routes to profits I really must put the
clout of the social media sites into context. The web's 800 pound gorilla of
traffic generation is undoubtedly Google, right? With Yahoo and
Microsoft trying to wrestle market share from Google but Google
increasing it to 66% the game is lost, right? Wrong, wrong, and wrong
again.
Less than 5% of people reach their destination via a
search engine. Seriously, less than 5%! That makes Google's share
less than 3 in a 100.
But Google is still the single largest source, right? Maybe not.
Click on this graph for a bigger picture:
The graph shows how Google.com compares with three large social media
sites: youtube, myspace and wikipedia. Notice that they are all within a
whisker of the mighty Google. What's even more amazing is their growth
trend. If each of those sites commands the same traffic rank as Google,
all the social media sites put together could so overwhelm you with
traffic you'll be on your knees pleading for mercy. Heck, if they got
together to send traffic to Google one day, they'd probably take the big
G's servers down! :)
 Look at compete.com's graph for
2007 below. The combined unique visitors from youtube, myspace and
facebook together dwarfs Google's
and makes Yahoo's and Microsoft's fade into insignificance:
.
Do you know how many million that is? 1,861 million for the year 2007.
My calculator ran out of numbers working that out. That's from just
three social networking sites. Almost 2 billion people!
Bear in mind that these aren't page views. They are unique visitors.
I've dwelled too much on traffic but I hope I've managed to
demonstrate just how big social media is.
And, folk, it's growing.
Earning from traditional models
From the above, and what you may know about the
Digg effect,
Slashdot effect
etc., there's no doubt about the traffic you can get. Do they convert?
Not initially, they don't. Users from places like Digg are visiting
because someone suggested yours may be a good page. They are rarely in a
buying frame of mind. However, they are more likely to buy online
when they do make a purchase. Further, they spend 25% of their
disposable incomes online as opposed to only 17% for the rest of the
online population. Contrary to popular opinion, many of them are older
people with very large disposable incomes. So, yes, visitors from social
media sites are welcome to any site of mine.
It is also a fact that people from these sites are more likely to be
webmasters and have blogs and more likely to send second generation
traffic.
Enhancing your position in search engine results: Have a lot of blogs
talk about you, a squidoo lens, ezine article and hubpage featured page
linking back to you, lots of people bookmarking your site at del.icio.us
and Stumbleupon and Sphinn, and SEs start figuring that you really are the
definitive site for that search term. There's a double bonus to be had -
the direct traffic from the social sites and floods from the SEs
too.
Earning directly off the social media sites
There are a lot of different ways to make
money from Social networking and bookmarking and we are going to
explore some of them in the coming pages.
Some Rules for using the Social Networking sites
1. They are a valuable source of market research and include feedback
that sometimes is too candid to make it into regular surveys. Use that
to your advantage.
2. Don't think like a marketer, think like a social animal wanting to
be part of the community. These places are tribal and don't like
outsiders. You need to be part of the tribe.
3. Build your reputation with other users of that network. Digg their
stories, write on their "walls", comment on their bookmarks, join their
groups and answer questions that you have specialised knowledge on. All
for free! The payback comes later.
4. Appreciate the power of word of mouth and be aware that bad news
travels even faster in the social networks.
5. Don't SPAM. Users of social networks are very anti-spam. You might
think you have a valuable message for them; be aware that their opinion
could be vastly different. Use pull rather than push, let them find you
rather than you pushing to them.
6. Target your efforts. Being deeply involved in a few targeted
groups/networks is better than spending a little time in a large number
of them.
7. Be consistent and be prepared to play long term to get best
results.
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