Why MySpace Will Lose.

When Dave was searching for our next Webinar topic, I suggested MySpace, since I knew I was having a call with a MySpace ad rep coming up, and I was excited because I had searched through their new media kit, and found their "communities" feature. Our PageStarter program is all about building communities on popular social networks for companies, and its the one network that has mystified us the most. A long time ago, we did a profile for the Green Acres Mall that was deleted over and over again, and we eventually gave up, since it seemed like a place where people connect, and businesses simply advertise. So, when I saw the communities feature on Myspace, I immediately stalked them so that I could discuss.

Well, it turns out that my original thoughts about MySpace were correct. 150K is the minimum ad spend to have a "community" on MySpace. A "community" like Konami Music, whose last comment was on January 26th, and has a total of 886 friends (that is, if you include Tom) .

*Note: According to the Press Release, there is a self service Community Builder feature, which I cannot find and was not mentioned to me by the MySpace rep-- pretty clear that 150K was the minimum..

Small or Mid-Size businesses can set up "individual profiles", as if the business is a person. The most troubling part of my conversation was when I was told that they are "no longer police-ing as hard to pull down businesses that aren't advertisers." Immediately, thoughts of Green Acres, an amazing organization that was ahead of its time in wanting to build a community on MySpace, passed in front of my eyes. Did MySpace actually pull down the profile because they weren't an advertiser? Is that possible?

I was told that all ads are cost per impression and can target by zip and demo only, but I seem to have found an area where there is PPC on MySpace with social targeting.

In any event, I have come to the conclusion that this is not a good place for businesses to interact with their customers. We at theKbuzz always quote the Cone Study on Social Media which states that, of the 184,000,000 Americans using social media, 93% expect to see their brands on social media sites, and a large portion of those expect to interact with their favorite brands on these networks. I'm not sure how MySpace can ignore that fact in an attempt to garner the ad dollars.

Short term, it's working. MySpace beat out Facebook this year in terms of ad revenues. But this model won't sustain itself for long. Facebook's genius move to encourage businesses to be more social not only works for the business but works for the END USER. Do a search on Facebook for Brooklyn Pizza, and see what you get. This will only CONTINUE as more businesses get on Facebook. Here's the REALLY big deal. These businesses will ADVERTISE. And they'll advertise using SOCIAL ADS. Based on SEARCH. Facebook is the google of social media, and their advertising model will be the google adwords.

Maybe it's the difference between a social networking site that is owned by a media company and a social media site that is owned by a bunch of really smart kids that stumbled upon something great...or the difference between being ad focused versus community focused....whatever it is, the trend of hyperlocalization and rejection of interupption advertising makes Facebook the winner.

I think I need to change the topic of my upcoming webinar. If anyone has had amazing experiences on MySpace, please comment here and let me know.

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