The Monster that Web 2.0 Created

By
Real Estate Agent with Fathom Realty West Sound WA State 52404

CLARIFICATION:   This article is simply an observation of the social media webscape in general. It is not intended as a criticism towards the members of ActiveRain in any way, shape, form, suggestion, undertone, or otherwise assumed/implied.

~     o     ~     o     ~     o     ~     o     ~     o     ~

With the advent of Web 2.0, there's been a virtual proliferation of interactive social media websites offering all kinds of really cool features and tools, all for FREE!

At a time when cost containment has quite literally become a way of life and a necessary survival tactic for today's Real Estate Professional, FREE is greatly appreciated! Especially for those of us who are constantly challenged with just covering our basic monthly expenses.

Unfortunately, in this rapidly spawning multiplicity of platforms chalk full of FREE stuff, the results have bred a rather 'spoiled' attitude from among those of us who have benefited greatly from their use. And the minute any hint of monetization rears its ugly head, the masses cry 'Foul!' and start jumping ship, heading off to the next recently-launched latest and greatest Internet FREE fest!

Okay, so maybe users don't necessarily jump ship immediately, but there certainly is a considerable amount of whining and resistance to the possibility of 'charging' a fee for something, even if that 'something' is simply an upgrade or improved version of what historically has been offered for FREE. And it doesn't really matter what the actual upgrade amount is, or whether the added benefits are justified. Anything more than FREE is just too much!

Granted, our community here at ActiveRain is somewhat unique. While I would consider this to be a social network, its application and impact extends well beyond a mere social environment. If offers significant features/benefits that serve to improve or enhance our businesses as well.

Here are some of the common methods currently being implemented for creating self-sustaining revenue on social networks:

1.   Advertisement Support:   Sell advertising space on the network. This is by far the most common, unfortunately ads on most social networks don't have the best track record of click-thru rate.

2.   Subscription Fee:   Require a monthly subscription fee of ALL members. This has been effective for dating sites, but that's about it.

3.   Data Mining:   Selling off membership data to 3rd party groups. Definitely my least favorite of the bunch, and really not an option unless you tell your members up front what your plans are.

4.   Site Sponsorship:   Developing partnerships with key companies to sponsor various network events or sponsor sections of the network.

5.   Affiliate Marketing:   A cooperative venture where a social network sells/promotes another company's products/services on their network, and splits the profits with that company.

My point in all this is not to voice criticism, per se, towards those who tend to complain about monetization or charging fees for certain features. We've all been spoiled to some degree by the rampant availability of FREE stuff. Neither am I condemning those companies who have contributed in unleashing the 'spoiled' monster.

Users/members of social networks need to be reminded that the company behind each social media site is a business, and as such, needs to create and maintain a self-sustaining profit to remain solvent/operational. Otherwise, all those really cool tools and features that you've been enjoying won't be FREE anymore. They'll be GONE!

Social media companies, on the other hand, need to create viable revenue streams that offer reasonable ROI on member investment, and justifies the fees being charged.

If social networks are to successfully survive and grow in today's challenging economy, there needs to be a better recognition/understanding of the truly cooperative/collaborative relationship that is exists between the network management and its vested members.

The first tenet of the ActiveRain Weltanschauung is this:

"We understand that the value of the ActiveRain community rests entirely with its members."

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Rich Jacobson is a District Director for Fathom Realty and a licensed REALTOR®; an avid Crab Hunter, Clam Digger, and Oyster Shucker, He is the Social Media Evangelist for Life on the Kitsap Peninsula & The Western Puget Sound in scenic WA State.

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Deb Brooks 01/13/2009 06:24 AM
  2. Gayle Balaban 01/13/2009 11:42 AM
Topic:
ActiveRain Community
Groups:
Active Rain Newbies
The Lounge at Active Rain
Social Media Marketing
Dedicated Bloggers
Social Networks
Tags:
social networks
social media
activerain community support
revenue stream
monetization

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Rainmaker
85,834
Michelle Tucker ~ Pooler Real Estate
!Daley Real Estate - Pooler, GA
Rincon~Savannah~Richmond Hill
Rich: Well said. Keeping in mind that a fee to be part of such a powerful network will keep those who take advatage of the site :: all those who just create a profile and never do anything, others who post just to post and never give back and the list goes on. Either way, I thinking a fee would be a great return on my investment.
Jan 13, 2009 06:03 PM #78
Anonymous
Kris Wales

Rich, thanks for the response.  It is appreciated.  I'm anxious to view the blogs of those who have upgraded and see first hand the look and "feel" of them.  Hopefully those who have upgraded will write a post or two pointing us their way.

Jan 13, 2009 10:43 PM #79
Rainmaker
339,762
Ann Cummings
RE/MAX Shoreline - NH and Maine - Portsmouth, NH
Portsmouth NH Real Estate Preferrable Agent

That "Nike Air Force" guy is leaving those comments all over the place, even here on an AR post!

I like Joan's question, and have been wondering the same thing, "I just have a question about how the seo is going to work -- can you explain a bit more about the enhanced outside blog vs. the AR blog"

And this comment from Virginia is too funny; "Even a tech-retarded old fogie like me knows - we got a good thing going here."

Cutlery?  Waffle Irons?

Ann

Jan 13, 2009 11:29 PM #80
Rainmaker
622,160
Morgan Evans
Douglas Elliman Real Estate - Manhattan, NY
LICENSED REAL ESTATE SALESPERSON

Describing these sites as a monster is a great analogy.  When will AR start charging us?  Thats the question that I ask myself, I see that they are starting to make money with Trulia now, making some money off the blogs, whats coming down the pipeline?

Jan 14, 2009 12:20 AM #81
Rainmaker
107,452
Kathleen Garvey
HomeSmart Cherry Creek - Denver - Denver, CO
Denver's Neighborhood Expert - Listings & Sales

Hello Rich!  Great photo of you!  When I see folks complaining from time to time, I have often wondered what it feels like on the corporate end.  Active Rain is a spectacular creation for more reasons than I can count in digits.  Offering additional upgrades is business savvy and when reasonably priced, how can anyone complain?  Google juice is priceless and the more I don't have to overthink/strategize in order to accomplish my reach....the better I like a product!  : )  Good job AR Board!  Regards-Kathleen G

Jan 14, 2009 12:41 AM #82
Anonymous
Anonymous

The term "Web 2.0" is completely meaningless, and the premise of this argument - that "Web 2.0", whatever it is, created the desire for free services over the web - is totally absurd.

Just my two cents.

Jan 14, 2009 02:13 AM #83
Rainmaker
18,537
James Shiner
Yelling Mule - North Andover, MA

Rich I agree 110% - FREE is great, and it works, for a while. But just look at Facebook, Digg, Twitter... all have a great user base, but they're hemorrhaging money. I read somewhere that Digg made $3M last year but it costs $6M a year to operate. Facebook is losing money as well, and Twitter isn't even making money. People will certainly understand why sites need to monetize if those or other Web 2.0 sites all of the sudden shut the doors.

You did leave out another popular business model: Pro accounts. Giving users a free account then the option to upgrade to pro. This model works so long as the pro account is really a major upgrade from the free account. This is probably the best way for most free sites to monetize without scaring away their users.

Jan 14, 2009 02:42 AM #84
Ambassador
580,090
Rich Jacobson
Fathom Realty West Sound - Poulsbo, WA
Your Kitsap County WA Real Estate Broker

Dear Colonel Swindle:    At any point you wish to enter the conversation here on ActiveRain 'legitimately' we would welcome your comments. Until then, keep your anonymous thoughts to yourself.....

Jan 14, 2009 03:58 AM #85
Ambassador
580,090
Rich Jacobson
Fathom Realty West Sound - Poulsbo, WA
Your Kitsap County WA Real Estate Broker

James:   Thanks for 'chiming' in. Exactly, if you're going to charge XXX for the upgraded 'Pro' experience, then related value/ROI needs to be explained/demonstrated.

Jan 14, 2009 08:58 AM #86
Rainmaker
1,507,666
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

Rich, are trying to tell us something?  Something that we can ask the Magic 8 Ball?  Like, as example, will AR start charging us in the future?

Jan 14, 2009 11:42 AM #87
Ambassador
580,090
Rich Jacobson
Fathom Realty West Sound - Poulsbo, WA
Your Kitsap County WA Real Estate Broker

Lyn:   My intention here wasn't to tell anyone anything. Simply an observation of the social media landscape in general.

Jan 14, 2009 12:07 PM #89
Ambassador
282,400
Scott Leaf Personal Real Estate Corporation
Keller Williams Elite Realty, Port Coquitlam, BC - Port Coquitlam, BC
Scott Leaf & Associates Real Estate Team

Weltanschauung!  round these parts those is fighting words! :)

Jan 14, 2009 12:12 PM #90
Rainmaker
241,072
SacramentoCommercialLoans Bank Turn downs welcomed
Sacramento commercial loans - Sacramento, CA
Quick closings 916-847-7212

Rich I have been thinking about doing the outside blog. I think $19 bucks is not bad if the blog has more juice than my own website. As long as the product delivers that same way the free site does I think it is a bargain. 

 

PS how is the weather sounds like the rain and snow are causing some real headaches.

Jan 14, 2009 01:56 PM #91
Ambassador
1,090,153
Celeste "SALLY" Cheeseman
Liberty Homes - Mililani, HI
(RA) AHWD CRS ePRO OAHU HAWAII REAL ESTATE

I appreciate what I do have....:) :)   Per our conversation last week...I'll do just fine :)

Jan 14, 2009 03:53 PM #92
Rainmaker
18,537
James Shiner
Yelling Mule - North Andover, MA

Rich - Exactly. Just like the upgraded blogs on AR clearly state what you'll be getting and why they're better.

Jan 15, 2009 03:09 AM #93
Rainmaker
449,852
Vickie McCartney
Maverick Realty - Owensboro, KY
Broker, Real Estate Agent Owensboro KY

Hi Rich~  You have bought up some points I really had not thought about, and some I have thought about.  I really enjoy activerain and the many benefits, both monetary and non monetary.  The genius's behind it need to be commended!  I have no intention of leaving here.   

Jan 16, 2009 11:17 AM #94
Rainer
69,154
Roberta Lee
Century 21 Olde Tyme - Norco, CA
Norco Corona Riversid Homes For Sale

Rich,

OK I've been absent for way too long.  Personal story here and I won't go into it now.  But..... if there is a monthly charge just let me know so I can pay it.  I have been gone for 6 or 7 months so all of this is new.  I have sure missed AR and it is good to be back I think???? :)

This was such a good blog. There are those that are really hanging on financially by a thin hair. Although $20.00 to a lot of individuals isn't worth thinking about, to them it might mean a meal or two.  Money for markieting just to stay alive in this market is difficult to come by.  These aren't bad or marginal Realtors just ones that have gotten caught in the Nations nightmare along with several million others.  I think timing is everything even in the business of the net.

Good to read you again. Thank you for all the time and effort you put in for so many others.

Roberta Lee

 

Cowgirl

Jan 18, 2009 07:28 AM #95
Ambassador
580,090
Rich Jacobson
Fathom Realty West Sound - Poulsbo, WA
Your Kitsap County WA Real Estate Broker

Roberta:   Nice to see your lasso pop up here! You've been missed. Do tell your story sometime!.....

Jan 18, 2009 07:32 AM #96
Rainer
69,154
Roberta Lee
Century 21 Olde Tyme - Norco, CA
Norco Corona Riversid Homes For Sale

Rich,

I will tell my story in a blog this week, but not for a "poor me story," just a different  perspective from someone that is seeing what is happening from the inside out.  Thanks for remembering me.  I love your blogs and I'm getting reacquainted with AR again....so many new things in just 6 months.....busy people....I love it.

Cowgirl

Jan 19, 2009 05:43 AM #97
Rainmaker
797,359
Troy Erickson AZ Realtor (602) 295-6807
Good Company Real Estate www.ChandlerRealEstate.weebly.com - Chandler, AZ
Your Chandler, Ahwatukee, and East Valley Realtor

People and business that are started as web 2.0 need to continue to find creative ways to keep costs down for it's users, while still providing a good resource for communicating and generating business.  Those business that are the most creative in this platform will be the ones that will continue to thrive.

Jan 20, 2009 08:21 AM #98
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