Social Networking

Popular social networking sites include facebook and MySpace.

MySpace was bought by News Corporation. A 1/21/07 New York Times article described how News Corp has managed the acquisition, giving the company considerable autonomy while pushing it to expand faster.

Ning is a service that allows people to create their own social networks. According to an article in the May 2008 edition of Fast Company1, Ning grows faster than most networks because it also incorporates a viral component. People who join a network invite their contacts, who invite their contacts and so on. The Fast Company article hypes this as a "viral expansion loop" (journalists are always looking to discover some amazing new thing that will sell magazines).

The idea behind a "viral loop" is that people actively recruit their friends and contacts to join a network they have started. The article argues that this makes Ning more powerful than viral marketing. That's because - while viral messages spread quickly from person to person - they don't create new viral messages. The article says that the Netscape browser "is widely perceived as the first online viral loop" because "its [the browser's] mere existence influenced people to create Web pages. That in turn gave incentive to others to get online, which acted as a catalyst for others to create more Web pages, and so on."

Youtube used viral marketing because it allowed anyone to embed a link to its content into their own blog or web page. Other people who saw the link embedded it onto their own sites, and so on, creating a lot of traffic for YouTube. That's the idea behind "widgets" too.

"Viral networks" are a powerful marketing tool because they reach many people very quickly.

This is really the network effect at work. Some networks grow faster than others though, and the faster the better. As Penenberg explains, Google benefits from a network effect because every site it advertises on (like this one) has a link to its Adsense program, which encourages more people to join, particularly as advertising pays. PayPal benefited from the network effect too.

Penenberg explains that the interesting thing about Ning is that people organize themselves into groups with similar interests, which allows for targeted advertising.

Penenberg refers to the "icons of Web 2.0, including Google, PayPal, YouTube, eBay, Facebook, MySpace, Digg, LinkedIn, Twitter, and Flickr."

3eep (pronounced "threep") is a social networking platform focused on community sports teams.

WSJ 3/12/09: Hulu embraces social networking

Value Proposition

Members of social networking sites can use them to find jobs. Asking your network of friends and contacts allows you to filter information.


Viral videos can spread malicious attacks about companies that demand a rapid response.

Teens not interested in Twitter

According to this article, teens are not interested in Twitter and see online ads as intrusive.

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