The numbers are amazing. MySpace’s membership has ballooned from 20 million people in 2005 to 225 million today, an average annual growth rate of 513 percent. Rival Facebook grew at 550 percent a year during the same period. LinkedIn’s rate was 182 percent.

Yet one social networking metric is distinctly underwhelming: the one with a dollar sign. Lookery, an ad network specializing in social media, offers display ads on MySpace, Facebook, and Bebo for only 13 cents per thousand times the ad is served (CPM); Yahoo’s average CPM is estimated at $13. Video ads on MySpace reportedly fetch just $25 per thousand showings; CBS charges $50 on affiliated sites, NBC as much as $75.

Social networking was supposed to be the Net’s next rocket to riches. But many social sites are having trouble capitalizing on their audiences, and it’s looking like the convivial atmosphere that promised to boost the value of commercial messages may actually diminish it. Even the big brains at Google are stumped. The search king, which pays a special rate to place ads on MySpace, has suggested that it may be paying too much. “I don’t think we have the killer best way to advertise and monetize the social networks yet,” Sergey Brin admitted during a January conference call with analysts.

Some smaller competitors are doing better. LinkedIn, for example, has a CPM as high as $75. The difference: The site caters to professionals, making it easier to target ads. (It helps that the company also charges for premium features and job listings.)

For sites with broader audiences, the key may be to give advertising a social dimension. Facebook tried to do just that with Beacon and Social Ads. These formats send users an alert or display ad when one of their pals patronizes an advertiser. But Facebook has yet to gauge the effectiveness of these programs because online privacy watchdogs pounced, and the site moved quickly to let members opt out.

Still, the idea that ads can be a social experience is the industry’s best hope. Social Vibe encourages members to choose brands to endorse on their pages. AdRoll shares ads across related niche sites, turning a blogroll into an ad network. But it may take time to work out the business ramifications of online friendship. The first site to meld commercial messaging gracefully into these new group dynamics will have advertisers poking them to be friends.

Article source -http://www.wired.com/techbiz/it/magazine/16-04/bz_socialnetworks

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Here’s a collection of several strategic methods you can use to deal with competitors within your niche. Do note that they should be implemented within a framework which tracks and measures your performance in relation to specific competitors.

1.       Focus on Building a Reputation. While products can easily be replicated, a strong reputation or brand is nearly impossible to appropriate without much effort. Brand your website consistently and focus on satisfying your customers or site visitors by generously offering support and free information.

2.       Increase Your Product Value. This two step process involves either improving the quality of your product and selling it at the competitor’s price or reducing the price of your product while keeping it at the same quality level. This can be used to counter surges in popularity for specific competitor products.

3.       Develop Retention Equity. Retaining first-time and regular customers is very important for market-share growth. The best way to do this is to make it difficult for customers to switch to a competitor. This can be achieved by offering specific unique features or benefits that your competitors do not offer. Loyalty-programs with attractive advantages can be implemented alongside your product or service offerings.

4.       Target a Sub-Niche. When your niche is overrun by strong competitors, it might be easier to target a sub-niche exclusively to capture a larger share of a targeted market. By breaking your flagship site into several sub-niches, you are deepening your brand’s reach within the overall field.

5.       Establish a Community. One way to build customer loyalty is to encourage interaction between customers through an open community. This can take the form of a forum, blog or social network. Communities are a public front for your community and can address customer or visitor concerns. Communities help your business develop excellent visibility on search engines as well.

6.       Optimize Your Product Launches. Product or site launches are a great opportunity to distinguish your website or product from a competitor. Make your pricing cheaper or similar to your competitor and aim to secure first time customers with an attractive initial promotional package. You can also seek objective reviews to demonstrate how it is different or superior to a competitor’s product.

7.       Celebrate Your Competitors. Create an industry-specific ranking or awards list to attract attention to your own brand or product. Two specific examples come to mind: Scott And’s list of Top 150 Marketing blogs, which evolved from a personal list to one jointly hosted by Advertising Age, a respected marketing/advertising publication.

Another example is SEOMoz’s Web 2.0 Awards, which has brought a lot of publicity to their business brand. The awards also received over 100K in backlinks and continue to bring them a fair amount of targeted search traffic. While the companies listed aren’t competitors, this example demonstrates how an awards list can be used for branding purposes.

8.       Perform On-going Competitor Analysis. Understanding the strengths and weaknesses of your competitor helps you to measure your own performance and success. You can learn a lot from how competitors operate and apply these techniques to your businesses in other industries or niches as well.

On-going competitor analysis simply means keeping conceptual and metric-based tabs on your competitor’s business and website. What are they planning for next month? How did their new product perform in the market?

9.       Collaborate on Joint Projects. Competitors can become allies when you seek to dominate a specific industry. Large scale project collaborations can grow your business or website considerably because they allow you to combine marketing resources and brand power.

A loyal customer of your competitor isn’t likely to purchase your product but a collaboration of some sort will encourage support for joint projects that will pull in new customers for both businesses. A simpler form of collaboration between webmasters can take the form of a basic banner exchange.

It is always important to note that your most powerful competitor might be the limitations posed by your own product, website or brand. Be sure to keep an eye on your target market’s needs/interests and focus on effectively communicating the value of your business.

The customer trust and reputation you’ve acquired is a necessary foundation you need to successfully compete in any niche.

Article source - http://www.doshdosh.com/how-to-deal-with-your-niche-competitors-guide-for-businesses-and-webmasters/

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Trust is a key usability issue when it comes to running a successful online business. Most people automatically view web businesses with a bias against them compared to their brick and mortar counterparts. Your ability to convince your visitors that yours is a trustworthy business is one of the key components to getting visitors to convert into customers.

Creating a website that conveys trust can be tricky. There are rarely any answers that are always “right” for every visitor. There are, however, several factors that have universal appeal to the weary shopper.

Company info

Provide your visitors information about your company and its primary owners and operators. Treat your shoppers with a company history and links to frequently asked questions, policies and physical location. The more information you provide the better satisfied any concerned shopper will tend to be.

Prompt responses

Shoppers want to know that they can rely on a company to meet their needs and concerns quickly once contacted. Be sure to respond promptly and professionally to all customer inquiries. Don’t let email or phone messages go unanswered for more than a couple of hours, especially if requests are urgent.

Feedback options

Create ways for visitors to provide user feedback regarding your products or services and encourage them to do so. Be sure to follow up with feedback and use it to better your services.

Transaction security

Emphasize that online transactions will be handled securely and that privacy is a top priority. Using secure logos and links to privacy policies page is a must.

Offer discounts

Sometimes discounts can be a negative, making you appear desperate. However when implemented properly and professionally, percent-off discounts and coupons can be effective and giving visitors an added desire to move forward.

Delivery options

Be sure to provide low cost and/or varied delivery options. Having more options available allow visitors to select the delivery method they prefer and trust the most, which will then lend additional trust to you.

Brand and product quality

If you sell brand-name products, be sure to emphasis this as your customers will be more likely to purchase a product brand they recognize. If you don’t have brand name products, create a brand and emphasize that. An unknown brand name product is still better than a no-name brand product.

Off-line retailer comparison

Provide your visitors compelling reasons why they should purchase products from you rather than an offline competitor. Highlight free shipping, lower prices, easy access customer support, etc.

Return policy

Adding a no-hassle return policy can clinch a sale. Be sure to have return policy information easily available and spell out exactly what is required to return a product and/or get a refund.

Minimal / clearly distinguishable ads

Don’t clutter up your space with ads. Keep your visitors focused on purchasing your products. If you have ads in informational areas of the site keep them to a minimum and make sure they don’t overpower your own information.
In an anonymous world where customers cannot examine a product or meet with company reps face to face, trust is much harder to come by. Online businesses have many more hurdles than offline businesses when it comes to establishing trust with their customer base. This means that as an online business, you have to do more than just create a compelling reason to convince people “why you” rather than a competitor.

Establishing trust is the key. Your shoppers need to believe without a doubt that, as a business, you’re not just in it for yourself, but that you care and will take care of the customer. Without having established any sort of trust there really is no sale.

Article source - http://www.searchengineguide.com/stoney-degeyter/10-ways-to-help-your-visitors-trust-you.php

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Yahoo is still fighting off Microsoft’s marriage proposal. But it’s open to making more friends.

On March 25, Yahoo, the largest online destination, teamed up with two other Web titans—search goliath Google and leading social network MySpace—to form the OpenSocial Foundation. The not-for-profit, which is scheduled to launch within the next 90 days, is dedicated to preserving open source programming codes that allow Web developers to build applications that work across all major Web sites. “We believe common sets of specifications are beneficial to the developer community at large and enrich the experience of the Web both on and off Yahoo,” said Wade Chambers, Yahoo’s VP of Platforms, in a media conference call.

Google launched the OpenSocial platform in October in hopes of solving two problems created by the increasingly social Web. The first issue concerned developers. Facebook’s May decision to open up its popular real estate to applications from third parties spurred thousands of developers to create programs for the social networking site. The enthusiastic response of Facebook users to the new programs encouraged other social networks to follow suit. Soon most sites were allowing outsiders to create programs for them.

All the opening up, however, presented developers with a dilemma: who to program for? Most social networks had unique codes that demanded developers build programs specifically to work on their site. Most development teams, however, had staffs composed of only a handful of programmers capable of creating just a few such specific applications at a time.

If developers didn’t make their programs work across sites, they risked losing out on valuable audiences who might use their program only if they could get it to work on their favorite Web destination. Worse, developers risked their program failing to get virally distribution because a user’s friends were not all on the same site.

The developers’ dilemma presented a problem for Web site owners as well. If developers had to choose one or two sites to program for, and your site wasn’t on the short list, you could miss out on the hot new program. Web surfers wanting to use a particular widget—such as Slide’s popular photo sharing widget or iLike’s music sharing and discovery service—would potentially ignore your site if that particular application wasn’t available.

Many sites, including Google, found themselves quickly faced with the flipside of the developers’ dilemma. Facebook was already on most developers’ short lists, thanks to the early release of its APIs and its global audience, which now reaches more than 70 million people. Without common codes, MySpace, Yahoo, Google’s Orkut social network, AOL, and myriad other sites would find themselves competing for the remaining slots on individual developers’ lists.

It’s no wonder then that Google, whose own Orkut social network lagged behind MySpace and Facebook in the US, chose to create a common set of codes for developers. It’s also no wonder why MySpace, which opened up comparatively late, quickly signed on.

Despite already being the most popular site on the Web, Yahoo has a lot to gain by joining. The company suffers from a lack of innovation. Several of its social properties, such as Yahoo 360, have failed to take off. Moreover, it has lost some mindshare among young people—those most likely to pass around many developers’ applications — to hotter social networking properties. By joining OpenSocial Yahoo ensures it doesn’t miss out on some developers’ next great creation. It also gets an opportunity to increase adoption of its own properties such as photo-sharing site Flickr by enabling developers to more easily create programs that spread Yahoo’s offerings onto other popular sites.

Getting on the OpenSocial bandwagon now is particularly important because of where the Web is going. Joe Kraus, Google’s director of product management, sees a future where social applications will live on nearly every site and audiences will take their favorite programs and content wherever they wish. In that world, making sure your content is easily distributable and that your site can support a variety of different programs is key.

Moreover, cute little widgets are quickly evolving into full-fledged programs. It may not seem so bad if your site doesn’t support an application allowing people to turn each other into vampires. But it could be terrible, say, if everyone began using a widget notifying them of important business emails and they couldn’t see alerts when on your site. “In the future we see applications for OpenSocial and the MySpace developer platform moving beyond toys and widgets and becoming real features,” said Steve Pearman, MySpace’s SVP of Product Strategy.

OpenSocial is far from perfect. Developers often still have a lot of work to do to customize their applications so they truly work across all the sites that have signed up. Also, like any open source standard, there is some worry that competing developers will be able to easily copy existing applications built upon the APIs.
The other problem with OpenSocial is that it is still far from comprehensive. Microsoft has, notably, not signed on. But, even Yahoo says it would welcome the tech giant’s friendship in this respect. “I think any large platform should be able to participate and we would welcome anyone to participate,” said Chambers.

Article Source - http://www.businessweek.com/the_thread/techbeat/archives/2008/03/yahoo_myspace_a.html

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Yahoo agreed to join rival Google’s OpenSocial platform, which aims at building an infrastructure for the social web, as Google described it. Through the OpenSocial, platform, developers will be able to create applications for social-networking sites. The platform was launched last November, and MySpace is already a member.

“OpenSocial has been a community-driven specification from the beginning,” said Joe Krauss, Director of Product Management with Google. “The formation of this foundation will ensure that it remains so in perpetuity. Developers and websites should feel secure that OpenSocial will be forever free and open,” Krauss added.

This association appeared as a surprise considering the known rivalry between Google and Yahoo, but, together with MySpace, the three said they were planning to ensure neutrality and longevity for OpenSocial and as founding members to offer developers the potential to connect with over 500 million people worldwide.

“Yahoo! believes in supporting community-driven industry specifications and expects that OpenSocial will fuel innovation and make the web more relevant and more enjoyable to millions of users,” said Wade Chambers, Vice President Yahoo! Platforms. “Our support builds on similar efforts with the OpenID community and will expand the opportunity for developers and publishers to benefit from an open and increasingly social web.”

MySpace also welcomed Yahoo! as an important addition to the OpenSocial network, stating that this alliance will provide developers with the necessary tools to make the Internet faster and ‘foster more innovation and creativity.” The organization will be created within the next three months.

With the help of OpenSocial, developers will be able to create applications to access social networks and update feeds, and with the help of a common API, they will also be able to make them available to users. This movement looks as a response to Facebook’s own open system that allows developers to create applications on the Web.

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by James “Dela” Delahunty

Digg founder Kevin Rose says that Apple’s 3G version of the iPhone will have video chat capabilities. His past predictions about the first generation iPhone turned out to be largely false but he is citing different sources for this information. In a recent “Diggnation” podcast, Rose told viewers that Apple is restricting third parties from authoring applications that run in both the foreground and background partly because it doesn’t want rivals to its own upcoming iChat software.

He claims the newer iPhone will have two digital cameras; one on the back of the handset and one behind the transparent touch-screen. The camera will allow video-conferencing over high-speed 3G data networks and according to Rose, users will be able to chat with iChat users on other iPhones or using software on their computer.

While Rose did get a lot of details wrong before the iPhone was released (reported a slide-out keyboard and CDMA support), he has made many good predictions in the past; the most relevant to this article being his last minute report of an iPod Nano before it was unveiled in 2005.

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