Smart Web to follow Web 2.0 for better engagement?
While 2007 was a year of enormous strides in social media, the industry is beginning to realise that the dream of monetising these popular consumer destinations is not going to be as easy as had been hoped.
As marketers consider what to focus on next, the enterprise social networking solutions firm Neighborhood America has made four rather bold predictions on where the industry is likely to go, and how that will impact business in 2008:
- Is Web 2.0 on its way out? Neighborhood America suggests that the next evolution of the internet is not simply an extension of today's technology, nor a new version waiting to be tagged with a trivial "3.0" label. Instead, the company predicts that it will be a whole new way of doing business, and "Web 2.0" will be replaced by the "Smart Web" as businesses learn that wasting resources in an effort to superficially befriend consumers isn't providing a good return on their investment. Instead there will be greater realisation that smart businesses engage consumers through strategic communities.
- Advertising to become measurable he advertising model will transition away from simple impression counts to a more valuable, measurable, experience model. That loop - or the advertiser's goal to engage consumers in a way that creates an experience and promotes measurable action - will begin to close as marketers increasingly look for more effective ways to maximise budgets under greater scrutiny and accountability.
- Enterprise Social Networks rise up The company foresees that many organisations will begin to view enterprise social networks as a valued business asset. Greater adoption of the concept will become evident as organisations move beyond the 'cool factor' and realise that high value communities can drive results throughout virtually every aspect of the organisation. There will be greater realisation that the value of many can impact multiple disciplines throughout an organisation. A community that may have initially developed from a marketing campaign, for example, will feed the business intelligence needed for product research and development, change management, customer retention and loyalty programmes, and stronger partner networks.
- Capital markets will be more demanding of all things 'social'. The market has become saturated with social networking companies, most of which deliver fun to consumers, but little in the way of successful business models so far. Venture capital and private equity funds will absorb the failures and the capital markets will quickly begin to realise that valuations based on impression counts are on the way out. Look for internet-native Software as a Service (SaaS) models to emerge as the preferred delivery business model.
"For businesses, the evolution of the social web was a good milestone, but not the destination," explained Kim Patrick Kobza, president and CEO for Neighborhood America. "While many continue to philosophise over when, if ever, businesses will begin to capitalise on social networks, many innovative companies have already achieved superior consumer engagement and revenue streams by adopting more enterprise-appropriate strategies. We expect to see phenomenal growth in this area during 2008 as the business world increasingly recognises that enterprise social networks, when used correctly, can be leveraged to deliver far more than social relationships."