Web 2.0 is "web services", which generally include Bloggers, MySpaces, Flikrs, searchers, and other standard (and old), yet "redesigned"-to-be-cooler services that people are now using to interact in greater, more sophisticated ways with marketers and each other. (Other categories include services for B-2-B).
Web 2.0 is also the evolution of the thinking that people are indeed interacting, but this time it's with your brand (not just each other), and in ways the marketer can't control, a complete shock to the "establishment" that's spent billions trying to modify our behavior so we can't interact and just obey. Thus, this cool new "webonics" also happens to encompass the next level of "viral marketing".
What is Viral Marketing - A Historical Overview
Marketers have always regarded "water cooler" banter as buzz, without ever realizing the depth and breadth of this banter. Because they didn't realize this, they were caught off-guard when the internet became one big proverbial water cooler exposing the banter for what it really was - not always endearing to the marketer. But the same challenge persisted - since it wasn't measured, it didn't mean anything.
Since 1998, at least 5 companies were creating and measuring real-time buzz using their own methodologies. (Our firm developed its methodology in 2000). Large marketers barely saw online buzz as a support service for their standard marketing activities, so these companies were relegated to working under the radar with media and entertainment companies. But as consumers increasingly engaged in online socializing (not a phenomenon, just the natural consequence of more people going online), the theories on which buzz marketers built their businesses were proved true; simultaneously, traditional advertising was delivering less bang for more bucks. These twin events lead marketers of all shapes and sizes to seriously explore alternatives to traditional advertising, including online buzz. In 2004 and 2005, at least 5 companies were launched to focus just on this. Recently, one online buzz marketer even received $14 million in venture capital.
Got Half-A-Billion Bucks To Spend? Don't Buy a Social Networking Site
Fascinating thing about MySpace is that the teens who use it aren't supposed to use it. In discussions with teens during an ongoing student behavior study, they tell us that their parents, schools, and other online access points prohibit them from accessing these sort of social networking sites. So, they've learned to by-pass the usual gates by accessing their MySpace accounts via search engines and when they're done, deleting their histories on the browsers they use. This rebelliousness should not be mistaken for a sign of long-term loyalty to the brand, and neither should the amount of time they invest in creating their online profiles and collecting friends.
The history of online socializing goes as far back as viral marketing: after the original AOL Members taught people how to connect online in the late 90s, Friendster, in perpetual "beta" mode, caught on, in the earliest remembered part of the new century. And well after anyone realized that Friendster lost its popularly, (and before they went off beta) Xanga became the new social networking destination. In between, Ryze, LinkedIn, Tribe, Orkut, MeetUp, Facebook, and Classmates popped up to serve specific needs for socializing. And of course relationship sites Match, Lavalife, JDate, and their ilk didn't fail to exploit the ironic loneliness of online socializing, (and for the record, desperately seeking companionship isn't as "fun" as these relationship sites would like us to believe). In six years, mass networking inevitably lead to niche networking with "pic" sites like Flikr and Snapfish, "bookmarking" sites like Wikipedia and del.icio.us, and of course, blog sites, like Blogger and Typepad leading the pack. Not surprisingly, these last few niche sites have and will continue to be bought by big corporations, the real engines behind Web 2.0.
With every new social networking entrant, none of the former sites became irrelevant and they even became adopted by those reliable late-adopters. New social networking site adoption (social-site-hopping or SSH) goes on and on, and now MySpace is the clear "hot" social network, but nowhere near the last. If the historic rate of SSH tells us anything it's that "friends" have become increasingly adept at following the traffic and transferring their entire profiles quickly to avoid interrupting their socializing and any other costs associated with such a transfer. In fact, many members continue to have profiles on multiple sites, despite their inactivity on some of the older ones. According to Nielsen, almost 70% of the U.S.'s population is online, accounting for 23% of the world's online population. That's 203.5 million people. Based on our analysis, there are over 150 million registered users to social networking sites (as of this writing). And we estimate that anywhere between 40%-to-60% of these registered users owns the other 60%-to-40% of the accounts on social networking sites.
Migrating From Web 1.0 to Web 2.0
Make no mistake, there will not be another online gold rush by enterprising pioneers. Large companies have already bought up or drawn in most gold-seekers into their fold. Their research departments are whipping out innovation almost as fast as Google and their presence has kept "irrational exuberance" in financially rational levels.
Consequently, Web 2.0 is
not another honey-pot for every Joe Shmoe with a laptop and a Starbucks
card. It's the application of practical services, the standardization of quality,
and (unless you're a hacker in disguise) the real death-knell for free stuff
online. Web 2.0 will herd traffic through bloggers and text ads to every new
hot network, content, and shopping bargain, and charge them for it. The opportunity
lies not in spending half a billion on something that's worth 10 times less
than that, but right back where it started: recognizing that anyone can generate
buzz. All it takes is your willingness to engage in an actual back-and-forth
banter with a million people around the "water cooler" internet.