A buddy of mine pitched me on a business idea recently, it wasn’t a bad idea but it really made be wonder about the types of internet startups people are launching today. His idea revolved around a plug-in that he felt would add value to the social world. These types of ideas seem to be rampant lately, everywhere you look, a new product is launching based on some API. Facebook started this, then came Twitter and Yelp, these days it seems like API’s are everywhere with Citysearch, Foursquare, Gowalla joining the mix. Think about this, how many sites have you come across recently with a domain name that incorporates the word “Tweet”? But, when everyone is leveraging off the same content, doesn’t it then become all about differentiation? And if your product isn't viral once launched, how much of a marketing budget will you need to achieve differentiation?
As I mentioned earlier, I liked my buddy’s idea but I told him that I thought achieving significant traction would be the challenging part. His reply was “I don’t think so. I think it’ll take off fairly quickly.” That told me all I needed to know. In my head, the guy’s thinking “set up a Fanpage, pump out a couple of tweets and we’re off to the races.” The sad truth is that this scenario rarely ever happens unless you have a powerful network. Even if you have 1,000s of so-called friends on Facebook, try selling them a product and see what percentage convert to your fans. With regard to Twitter and harnessing its power, unless you’re an established player like TC, goodluck getting RTs on a consistent level. You’ll first have to invest a lot of time building your social capital which means retweeting other people’s content. It’s only after you’ve built your capital that the social influencers may begin to reciprocate. In fact, I’m starting to question if there are any real consumers on Twitter. From my recent observations, it seems like the majority of people on Twitter are pedaling/marketing something. Outside big brands, celebrities and bloggers, I think the rest of the community is comprised of ex-Myspace spammers. For them Twitter is the perfect platform for their activities. So if I spend my time on Twitter trying to push a product on someone who’s trying to do the same to me, is anything really being accomplished?
The point is, having an idea is great, but you need more than that. In fact good SEO may be easier and more beneficial than social media marketing. With so many social networks out there, people are starting to become jaded. In reality, the best ideas have some barrier to entry, if not, you’ll need a good market plan. Your marketing plan becomes your business plan, and will determine if you’re successful or not. With regard to marketing, will you hire a PR firm and how much will it cost? Do you have an overall advertising budget? How good is your network? What’s your customer acquisition cost? These are the factors you’ll have to seriously consider if you plan on leveraging an existing platform.