The Portalization of Social Media: Notify, Moments, & Discover

Published on Author Eli Fennell

 

Snapchat Discover

 

Social media is now one of the largest, if not the largest, uses for a few billion internet users globally. Over one and a half billion internet users are on Facebook alone, and more and more internet users are on multiple social networks including YouTube, Facebook, Twitter, Google+, Pinterest, Tumblr, and LinkedIn.

The myth of social media is that its value lay in the network effects of getting users to form connections, communities, and other ‘sticky’ social connections that make it less likely they’ll ever leave. To a point this is true, but only if you’re considering the endurance of the network as its sole measure of value.

If longevity were financial value, however, Twitter wouldn’t be facing the stock devaluing challenges they’re currently facing. The financial value of a social network, generally speaking, comes down to its advertising value: once you’ve attracted those audiences to your network, you can start targeting them with advertisements. All of the most highly valued social networks allow targeted native ads (even Google+ integrates with AdWords via +Post Ads).

Unfortunately for investors, no social network can keep showing more and more native ads to the same user base indefinitely; there is some nonzero number of native ads you can display before you’re no longer a social network, you’re just a pushy advertising platform, and no significant user base would ever stick around and use you for very long.

This leaves a social network three options for significantly expanding their advertising value: 1) Grow Their User Base Exponentially, 2) Get Those Same Users to Spend Way More Time On Service, 3) Significantly Improve Their Ad Targeting.

Banking on exponential user growth is fine for a startup in their growth phase, but obviously a Facebook or even a Twitter may not be able to count on this anymore. Improving ad effectiveness, on the other hand, tends to be more of an iterative process of improvement, even though every new advertising feature does promise a quantum leap forward. That basically leaves getting users to spend more Time On Service as the main strategy for revenue growth for mature networks.

The problem is, you can only get the user to do the same sorts of things just so often. Imagine if Google Search tried to get its users to perform as many video related Searches as YouTube users perform. It would be impossible, and Google would have to work very hard to even come close, possibly to the point of annoying users with endless unwanted prompts to Search for yet more video content. But because Google owns both ‘channels’, they can capture both types of traffic without resorting to such tactics.

Facebook has pulled off two similar coups, in the form of acquiring first Instagram and then WhatsApp, two extremely popular channels with their own user bases. The users of these platforms overlap with each other, but a person who uses Facebook and Instagram doesn’t feel like they’re spending all their time on a single channel. Getting them to double their Facebook usage would be almost impossible, but getting them to double their social media usage through additional channels is more attainable.

Unfortunately, such acquisitions can be difficult and very costly when they fail. The more affordable option, in general, is to launch homegrown apps and build them up into separate channels. There has been little success, however, by any social platform in doing so. Facebook Messenger has done well enough for itself, but was originally part of Facebook, and its split while successful still felt unnecessary to many of its users.  Messenger is less a channel of its own than a subchannel.

Poke, Paper, Home, Hello, and countless other Facebook apps have failed, including every app which they’ve launched as a truly separate app (excluding acquisitions). Twitter owns Vine and Periscope, though it doesn’t seem to be moving their numbers meaningfully. LinkedIn launched a dating app called LinkedUp, but it doesn’t seem to be threatening Tinder or eHarmony in any way; if anything, it’s slightly embarrassing to their professional brand.  FourSquare launched Swarm, but it isn’t clear that doing so has been of great benefit for them.

Because of this tendency to fail when ‘going it alone’ outside of the main network, the usual approach social networks take to pursuing new revenue opportunities is to add new features to their platform instead of separate apps, or at least to integrate any new apps deeply within the existing platform. The problem with this approach is that, ultimately, the new feature needs to fit the platform, in much the same way a native ads fits the platform. Users should see new features as a natural fit, or they’ll reject them, if not overtly then through the slow strangulation of non-use.

Social network users should see new features as a natural fit, or they'll reject them.Click To Tweet

When features are grafted onto platforms that don’t fit natively, the platform begins to become something other than what it was, something far more nebulous: a portal. Those who remember the early days of the world wide web, from AOL in the 90’s through to Yahoo! and other web portals of the early 2000’s, will also remember the portalization of the web. Every site wanted to be everything for you: your news source, your calendar, your horoscope, your sports ticker, your stock ticker, your funny quote generator, all of it in one place at one time.

It was conventional wisdom, in fact, that we wanted things to be this way, for the ‘convenience factor’. We didn’t. What we wanted were platforms that knew what they were for and did those things well. Google probably did more to disrupt the portals than any company: their non-portal Search Engine beat the portals of its day through a relentless focus on its core Search Mission. Portals didn’t fit this model, and Google deliberately refused to portalize even as investors demanded it. Today, they’re one of the top brands. Apple’s iOS, and its success in helping mainstream the app market, helped to further destabilize web portals, as it has become harder to fit multiple features into the available screen space.

The nightmare of web portals has begun to repeat itself with social media, as the major networks begin to yield to investor demand to generate new revenue streams. The promise of social media being ‘The Next Big Thing’ that would exceed everything before it by leaps and bounds, has been held out on for over a decade at least, yet the ‘old things’ (i.e. Search Advertising) continue to generate more revenue, so the old cycle is repeating, with networks trying to justify their own valuations.

The nightmare of web portals has begun to repeat itself with social media.Click To Tweet

Three recent examples best illustrate this process, and why it probably won’t work any more than previous portalization efforts.

 

Facebook Notify

Facebook Notify provides publishers a means to get readers to subscribe to… well, notifications. Lockscreen notifications, specifically. Unlike Instant Articles, which simply aim to improve the News Feed experience on mobile, Notify is something else, something separate. Even if Facebook uses their site and app to promote or integrate it, it’s probably a safe assumption that these sorts of Notifications will never be allowed to completely overtake the traditional Facebook Notification mechanism, the one that reminds users Likes, Comments, Groups, Events, and more.

Notify moves away from Facebook’s native social platform, to try to become a social layer on top of your phone’s Notification system, a ‘Facebook for Notifications’. This is, perhaps, a look at the kind of Notification Center a Facebook Home might eventually have promoted had it not failed. But Home did fail, because it was a bridge too far: no one wanted a Facebook Phone. It didn’t fit. Facebook employees may have lived their entire existences in the Facebook app, but average users didn’t. There was literally no demand for it outside of Facebook’s investors, as there is literally no demand for Facebook to own the Notification Center of our phones.

Notify doesn’t “belong” in the Facebook News Feed paradigm, so to become a significant new revenue source for Facebook it will have to succeed virtually from scratch, banking on the idea that enough people will adopt it to virtually recreate the network effects of Facebook itself. And even though Notify will certainly put Facebook Sharing and Commenting front-and-center at some point, if not from Day 1, this does not make it a part of the parent platform. It will succeed or fail on its own.

Notify doesn't 'belong' in the Facebook News Feed paradigm.Click To Tweet

 

Twitter Moments

I’ve already written about Twitter Moments elsewhere, so I’ll keep this brief: Moments is a visually beautiful Twitter-powered media experience… but it doesn’t fit as part of the Twitter Stream much better than Facebook Notify seems likely to fit the News Feed.

The very interaction paradigm switches between the two: the main Twitter Stream is like a character limited, real time Facebook News Feed with just a hint of algorithmic filtering, while Moments is a Twitter-powered ‘micro-interaction’ social news reader, almost a ‘Tinder’ of social news readers oriented around swipes and big beautiful visuals. Moments should be a separate app, and both are being underserved by Frankensteining them together.

As a possible confirmation of my viewpoint, Twitter has begun to aggressively reposition the Moments Tab next to the Home Tab on their app and website, in a position previously occupied by Notifications.

This could be evidence that the feature is producing desired results, but repositioning Tabs in this manner is more often an attempted ‘growth hack’, giving it custody of highly trafficked screen real estate in hopes the user habit will persist despite the change. Unfortunately, such attempts more often distract from the social purpose of the service than advance a new product successfully.

 

Snapchat Discover

An unintended forerunner of Moments and Notify, Snapchat’s Discover helps users experience a ‘Snapchat Flavored’ media experience from their content partners, with 15 channels including CNN and BuzzFeed. These channels simply don’t fit with the way users discover and share content on the network, not even remotely, and as a result the network seems highly overvalued.

Ironically, they would have been way better off letting Facebook buy them, and Facebook meanwhile would have bought themselves an overvalued lemon, a social network with absolutely no native advertising platform, and in fact no obviously plausible platform for effective ads using the standard sharing and discovery tools the users themselves gravitate towards.

Let’s cut the nonsense: it’s a network based on sharing short, self-destructing messages, favored mostly by teens and young adults almost precisely for its obscurity. It is not a place where people are especially amenable to any traditional form of advertising or marketing that would lend itself to capturing a large portion of ad spending in the corporate world.  Only the hype around social obscures this obvious fact.

 

The Portal as Unicorn

Despite all the good reasons to be skeptical of portalization, overly optimistic investors will continue to believe that the day is inevitable when we will all go to a single channel for all of our consumption, be that an ISP, Web Directory, Search Engine, or Social Network. They will continue to believe that, where an audience exists, any product displayed to that audience can succeed beyond the dreams of avarice, and any new features added can become a revolution.

Yet, like the Unicorn, the successful web portal is a creature of legend. From AOL to Yahoo! to iGoogle to the ‘Big Blue Facebook App’, the portals have died or fractured, and it isn’t a coincidence: the portalization process itself heralds the desperation of a business model to justify a valuation it has gained on the power of hype rather than solid business foundations.

When all hopes for the growth of a company’s valuation are based around grafting incompatible products and business models onto their core products in a ‘spaghetti on the wall’ orgy of experimentation, it may be time for the crafty investor to place their money elsewhere. Social media has a place in the internet advertising landscape, but it may not be the Holy Grail, after all.

I love technology and how it changes our lives. There's something almost spiritual about how new technologies connect and empower us. And it's really cool, too.

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