Can the network be the product?
That’s the question I ask in my latest ClickZ article, “Can Closed-Door Exclusive Social Networks Make Money?“
Here’s the premise: while social media might be great as a promotional tool, can it be a product? If you’ve got something unique, shouldn’t you be able to charge for it? Why should celebrity twitter stars such as Justin Bieber and Lady GaGa give away free access to their lives? Yes, it builds a fan base, but once you’ve got those fans hooked, don’t you think that they might pay for more “exclusive” access? I bet they would.
But you don’t have to be on the A-list to possibly monitize your social networking. Couldn’t agencies make access to an exclusive social network (and exclusive marketing/creative advice) a benefit of being a client? Couldn’t conferences use exclusive attendee/presenter social networks as a value-add and an incentive to sign up? Couldn’t service providers like plumbers, electricians, and even doctors provide (for a fee) access to a network where their customers/patients get personalized help and exclusive assistance?
It’s not that odd of a concept. After all, we’ve got “membership” retail establishments like Sam’s Club and BJ’s. There are a growing number of “boutique” medical practices that don’t take insurance but offer highly-personalized services. And heck, private clubs have been with us for eons.
Some may say (and have, in the comments section at ClickZ) that this “destroys the idea of social media.” Others have argued that this approach is akin to paywalls on newspaper sites (an approach which seems to fail in most cases). Others simply object on the basis of “information wants to be free.”
I don’t disagree with any of those points. Why should I? We’re not even arguing the same thing.
Destroying social media? I’m not saying that ALL social media should go to a pay model. Far from it.
People don’t want to pay for information? Not even the same argument. The reason that people don’t want to pay for news is that for the most part it’s become a commodity that anyone can get for free. And it’s not true that all newspaper paywalls have failed: the Wall Street Journal continues crankin’ along pretty well with a pay model. Why? Because they have exclusive and unique content. You can’t get it anywhere else. If you want it, pay for it. That’s a lot different than paying for a slightly edited version of a wire service story you can get thousands of other places online.
As for the “information wants to be free” argument, I think I’ve written enough (here and other places) to make a case that I agree. Information is difficult to contain…just ask the Pentagon and WikiLeaks. But what we’re really talking about here isn’t information as much as a service: access to an expert or access to a network that can’t be digitally duplicated.
And maybe that’s the bigger lesson to learn from this idea: if something can be digitally duplicated so that the copy is indistinguishable from the original then it’s very difficult (if not impossible) to monitize it over the long run without adding value in some way (ease of use, customer-friendliness, the good feeling that you bought something rather than stole it). On the other hand, if something can’t be copied–access to an expert, physical objects, access to a network, trust, goodwill, etc.– than it is possible to make money from it.
It all comes down to one of the basic principles of economics: things that are abundant are worth less than things that are scarce. And we certainly ain’t got no shortage of social media right now. Making yourself more scarce, putting up the virtual velvet rope, might be the way to monitize what you’re giving away for free right now.