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Some of the world’s leading online tourism experts will be speaking at the E Tourism Africa Summit in Johannesburg, which is being sponsored by See more
Some of the world’s leading online tourism experts will be speaking at the E Tourism Africa Summit in Johannesburg, which is being sponsored by Visa and Vodacom Business. Global online giants such as Trip Advisor, Travelport, Expedia and Google will be giving presentations at the two day conference on the 1-2 December, on how Africa’s tourism sector can harness the potential of the web, especially in the lead up to the 2010 FIFA World Cup.
The stellar line up of speakers includes Head of Tourism for Google Andrew Pozniak, Trip Advisor’s Head of Emerging Markets, Maude Larpant and leading Internet innovator Jerome Touze – the co CEO and one of the Founders of WAYN.com – the world’s leading travel social network, which has over 15 million members.
Touze spoke at last year’s E Tourism Southern African Conference and he has since worked with South Africa Tourism on a social media campaign called the “Face of South Africa”, which has been hugely successful, attracting over 5 million views and 20,000 applications for the competition.
“We have achieved some amazing results through social media for South Africa Tourism and I am very pleased to be returning to Johannesburg to speak at the E Tourism Africa Summit. Its great to see much more awareness and understanding from Tourist Boards about the importance of the web and social media as a strong marketing tool”, said WAYN.com co-CEO Jerome Touze.
Damian Cook, the CEO of E Tourism Africa, said that alongside the international speakers at this year’s summit, there will also be an impressive number of Africa based companies and projects presenting new and innovative ways of promoting and selling Africa online.
“Since our first conference in Johannesburg last year, we have seen major changes in the way African tourism companies and destinations are using the web. We have some amazing projects in our line up this year- including South African company – Wild Earth who stream game drives live to the world via vehicle mounted webcams and provide Twitter updates and interactions with viewers as they go”, said Cook.
Uganda Wildlife Authority will also be presenting at the summit. UWA recently made their population of endangered mountain gorillas members of Facebook, through the launch of Friend a Gorilla. The project, supported by a group of Hollywood celebrities, grabbed world headlines and garnered over 12,000 supporters in the first weeks of operation to both promote tourism and conservation in Uganda.
Also presenting at the summit will be ecologist and author Dr. Paula Kahumbu – CEO of Wildlife Direct who have created a blogging platform and social network for conservation projects that has seen donations of almost US $1 Million in recent months- Paula will be discussing how Tourism and Conservation can work together online.
The E-Tourism Africa CEO summed up, “African Travel companies have seen the success of tourist produced online viral videos such as the Battle of Kruger, which has been viewed by over 50 million people, and they are now creating platforms for user generated content, reviews and discussions of their products. More companies are also using Twitter and Facebook to develop strong networks of supporters and consumers. One of our key messages is that the market now looks to their users for advice and content- and a great review or video posted by a user is marketing gold- it’s all in how you make use of that. The web has really made it easy for small players to use technology, creativity and innovation to make a big connection with global markets. And with the world’s spotlight on Africa next year with the 2010 FIFA World Cup™, it is critical that tourism companies in South Africa and across Africa take advantage of online marketing opportunities. The E Tourism Africa Summit will show them how”, said Damian Cook.
The E Tourism Africa Summit will be held in Johannesburg at the Gallagher Convention Centre – Midrand on the 1st-2nd December 2009.
Registration for the E Tourism Africa Summit is open now – www.e-tourismafrica.com
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Cornichon is in New York City this week for French Affairs, an annual confab organized by the French Tourism Development Agency. Last year, in Chicago, when this was still called Maison de la France, the big news was a promotional campaign called "Rendez-Vous in France." This year, they've reorg
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Cornichon is in New York City this week for French Affairs, an annual confab organized by the French Tourism Development Agency. Last year, in Chicago, when this was still called Maison de la France, the big news was a promotional campaign called "Rendez-Vous in France." This year, they've reorganized. The Tourism Ministry no longer reports to Culture but to Finance. (Tourism is France's largest single generator of foreign revenue.) It has a new name: Atout France, which is a bit of a pun: un atout in French is your trump card. (In English, on the other hand, a tout is a pretty unreliable guide.) So what are they thinking? Confusingly, the atoutfrance.com website has nothing to do with the agency; the official site is franceguide.com. It's full of useful tidbits, even includes videos, Twitter and Facebook links, but suffers from information overload: too many destinations, too many ad banners, too many promotions, too many links to tour operators and suppliers. And yet there's much to admire. France was the first country to target a wide variety of niche travel markets: gay & lesbian, Jewish, religious, Hispanic, luxury, first-timers, retirees, French expats. Theme travel, too: culinary, wine, ski, spa, and so on. There's no comparable agency promoting the entire USA; individual companies (airlines, hotel chains, Disneyland destinations) and individual states and cities are expected to do their own marketing campaigns. The Sarkozy government pitched in to help France's embattled hospitality sector by cutting the VAT on restaurant meals by 75 percent, but hotel revenues, in the world's most visited country (77 million foreign tourists a year) are still down 13 percent. You get the feeling, with some 14,000 disparate events scheduled for 2010, that the whole country is scrambling. Fewer Americans are heading to France, even though, in tough times, the preference is for the familiar vacation destination. Trouble is, the greenback is way down, worth only two-thirds of a euro. And the tour operators in attendance here, an older group, reflect the aging American traveler to France: over-50 repeat visitors. "The challenge is generational," says Patrice Doyon, Atout France's deputy director for strategy and research. "We have to make France attractive to younger people and first-tme visitors." Which is why, at 8:30 in the morning, a roomful of mature adults are listening to the 29-year-old founder of WAYN.com (for "Where Are You Now?"), a Frenchman named Jérôme Touze, try to explain how social marketing works...and how it can help the tour operators build new business. Facebook use was up 217 percent last year; Twitter grew by 1,298 percent. It's a train the travel industry needs to ride. One hopes that the country which built an incomparable TGV network (to continue the railroad metaphor for a moment) wouldn't be left standing on the platform. But it's hard to change course when you've got those 77 million reasonably content visitors spendng all that money every year. Atout France needs more than an ace in the hole or a trump card up their sleeve to compete with the global recession and the effect of $100 a barrel oil prices on airlne tickets; they need to lose that French sense of entitlement.
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What is WAYN?
WAYN is the fastest growing travel and lifestyle social networking community website. WAYN is present in 193 countries and membership has grown from 45,000 users in March 2005 to over 15 million today. WAYN is all about connecting like-minded people and helping them to find each other, to meet, to share dreams and aspirations and to help them enhance their social statu
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What is WAYN?
WAYN is the fastest growing travel and lifestyle social networking community website. WAYN is present in 193 countries and membership has grown from 45,000 users in March 2005 to over 15 million today. WAYN is all about connecting like-minded people and helping them to find each other, to meet, to share dreams and aspirations and to help them enhance their social status. WAYN is not just about travel, it is about meeting people and having fun!
Who are WAYN’s main competitors and how do you differentiate?
It is an interesting one. If you look in travel there are few travel social networks of any significant scale. You have the niche utility sites such as Dopplr, TripIt and TravBuddy. Then you have mass market travel sites such as Expedia and TripAdvisor who recently bought Virtual Tourist (since it was bought it has really capitalised on Trip Advisor’s SEO and driven traffic).
In terms of other types of social networks, we also compete with Facebook (albeit not directly) as this does have the mindshare of people’s time on social networks.
Where we are different is in making new friends – 60% of users on WAYN say they use it to meet new friends and not just to connect with existing ones.
Tell us about your business model – is ‘freemium’ the way forward?
Freemium is definitely the way forward. It just depends on what that means. We came from a subscription background (following the advice of Steve Pankhurst from Friends Reunited) but when the market changed in 2005, we had to change in order to compete. We did not think that our offering was sufficiently differentiated enough to justify people paying subscriptions. At that time our revenues were 70% subscription and 30% advertising based. Jumping to today, advertising is now the bulk – over 70% of our revenue is now from advertising.
Shifting our business model is the best thing that we could have done. It allowed us to go from 1.8m uniques to 7.5m uniques. It was a great way to grow audience. It also forced us to learn about how to monetise using advertising – prior to the change we did not really understand what our clients wanted but now we truly know our client base and deliver real satisfaction. We have great case studies to show companies in the lifestyle, leisure, travel space about how we genuinely drive traffic, improve conversions etc.
Going forwards, it is an interesting one. We do believe that advertising allows scalability and it is a useful platform however we do not believe it is the ultimate answer. We have recently refocused our efforts to create a new type of subscription offering called VIP. This provides a premium extension to our existing service. It provides subscribers with a combination of offline and online benefits such as browsing in secret, sending gifts, reduced entry to nightclubs etc. So far the feedback has been really positive.
We’d love to know how you initially took the concept from a piece of paper to an actual website…
The idea came from Jerome whilst he was on the Pacific Highway 101 in the US with friends. He thought wouldn’t it be cool to be able to know where your mates are and connect with them etc.? I had been doing a summer entrepreneurship course at LBS and when Pete told me the idea I thought it was great and could immediately see the value (unlike others he had told who thought it was a rubbish idea!). Jerome and I had met previously at a social gathering for Accenture, our employer at the time. We immediately brought in our other friend, Mike Lions, who is the tech brain and we started spending weekends and evenings over the next few months working on it.
Our day jobs were definitely not 9-5 so we were desperately trying to scribble notes on the way to work and do support queries in the evenings etc. We used to meet at LBS and put ideas on whiteboards then send them to Mike who turned them into reality for the site.
It was a real grass roots and bootstrapping approach. At times we did question if it was worth it – we spent two years of our time not making any money from it. That was tough. However in year one, we managed to get £10,000 from Steve Pankhurst and in year two we secured another £15,000. It was not until year two that we discovered that Google ad words was the key to getting customers and we managed to get 45,000 customers. In early 2005, we re-launched the site with web 2.0 features and other novel things and it was amazing – the site went from 45,000 to 1m members in six months. Our next challenge was then about sustaining this growth.
What was the toughest thing you faced in the early days? What is the biggest challenge you now face years on?
Our first challenge was growth – how do you manage growth? We did not know about VCs or funding, we were just thinking about how do we keep this running? We thought that if we blocked every country except for the UK and US from using the site we could limit usage – we really stifled a lot of growth at that point. Also because we charged that limited a lot more usage and finally we also restricted the site to over 18s. If we had known about the VC industry then and how taking some money would have helped our growth we would have done it very differently. The VC industry is a good thing.
The other challenge we faced was when we saw the market changing and we saw the rise of Facebook. For us, the question was how do we respond? We raised money and de-risked the business by taking some money off the table. We then changed the business model – we essentially ripped the business model in half and had to start again!
Now, our biggest challenge is how we constantly differentiate ourselves and compete in a very competitive market space. Everyone is on Facebook and uses Twitter so we have to constantly redefine what people want. We have to provide people with a reason to use WAYN. We are just focused on helping people to connect, to have fun and to be able to share dreams, aspirations and experiences.
What are the pros and cons of the current market?
The positive is that there is a lot of innovation in the market – people are trying new things and mobile is exploding. Things such as Android have made it easier for developers to make applications etc. The climate is providing a host of opportunities to take advantage of and there is a real buzz in the industry thanks to people like The Up Group and the Drink Tank boys etc.
The downside for start-ups is the fact that it is difficult to raise money. It is only possible if you have a proven monetisation model or you have a business with a great idea that is getting great traction.
How did you find raise initial financing and why did you take the investment that you did?
One of my biggest recommendations is to bootstrap as much as you can in the early stages and don’t give away too much equity too soon. When you don’t have much cash like us in the early days it focuses your mind on what you can do - so you just buy the server, you get a friend to do the graphic design and not an agency etc. Don’t raise Series A too early.
We raised our Series A in November 2006 – it was lead by DFJ Esprit who have been fantastic. Nic Brisbourne is on our board and he is very supportive of the management team and works really collaboratively. Brent Hoberman was our initial Chairman and is also an investor. We now have the befit of Simon Guild at the helm, who has been fantastic since day one. Simon used to run MTV across Europe, Middle East and Africa and achieved great success for MTV. We are very happy to now have him on board. David Soskin and Hugo Burge from HOWZAT Media (also Cheapflights) are also investors as are the co-founders of Active Hotels, Adrian Critchlow and Andy Phillipps. Finally, we also have Constant Tedder on our board, the co-founder and managing director of Jagex Ltd, which runs RuneScape, the UK’s largest online multi-player game.
The board are fantastic and all very relevant to the online, travel, gaming and entertainment space.
Steve Pankhurst of Friends Reunited was an original investor however he had to relinquish his shares due to the sale of Friends Reunited to ITV.
Did the fact that you were both young first-time entrepreneurs mean it was even more difficult to get funding?
No I don’t think it did. I think it helped that we had work experience from a credible organisation like Accenture and it helped that we had grown our small investment to a £2m business already. I think people take the view that the proof is in the pudding.
Brent had had unique experiences himself so I think he related. As long as you show that you have the ability and that you are working on something novel and that there is a real opportunity then the VCs don’t care how old you are.
What is the biggest mistake you have made as a CEO?
On of our biggest mistakes was trying to keep up with the Jones’s. We naturally tried to emulate what players like Facebook were doing and apply it to WAYN. We were trying to compete with something much bigger than we were and we were never going to win. We tried to do too many things reasonably well. We are learning from that now. Focus is key.
What do you think are the main ingredients of building the best team?
Attitude. It is all about finding people who compliment your strengths. Get the right people on the bus early. Don’t be a lone ranger. You have to be smart about who you hire and you have to put people through the mill – we try and create near to reality scenarios and see what people would really do. When you find good people then look after them and incentivise them to do well. We now have teams aboard and managing remotely is tough but you have to get the balance right with autonomy and empowerment – communication is the key.
What is hot in the start-up world right now?
I don’t have the time to scour TechCrunch and Twitter to see what new online start-ups are launching as otherwise I would not get any work done! There are so many ideas but unfortunately many do not happen. In the UK and Europe we should try and get behind start-ups like they do in the US more.
Spotify has created great traction and I wish them the best in capitalising on that momentum and just hope they can before the money could run out!
TweetDeck is another great idea and run by a great guy – it was a smart move to get PROfounders on board.
I also very much rate the Huddle guys (Andy McLoughlin and Ali Mitchell) and there are some exceptional young entrepreneurs coming through the pack – too many to mention!
However, apart from that, nothing springs to mind that makes me really go “Wow – that’s going to be the next Google” at the moment in terms of new start-ups but I really do admire some of the more established start-ups that have managed to scale. Seatwave is a great example – Joe Cohen has created real scale there. Lovefilm also.
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This year’s Take Heart Ball will be taking place at Kensington’s Roof Gardens in London tonight, 1 October. The jungle fever themed fundraiser will again attract over 600 young socialites, including royalty, celebrities and budding entrepreneurs.
Guests at last year’s event included Princess Beatrice, See more
This year’s Take Heart Ball will be taking place at Kensington’s Roof Gardens in London tonight, 1 October. The jungle fever themed fundraiser will again attract over 600 young socialites, including royalty, celebrities and budding entrepreneurs.
Guests at last year’s event included Princess Beatrice, Peaches Geldof and Sam Branson, son of Sir Richard Branson, who is also a key member of the Take Heart Charity Committee. This year the Roof Gardens will be transformed into an urban jungle: affluent Tarzans and glamorous Janes partying into the wee hours, the flash of wild animal print passing through the dark jungle foliage, off to claim their prey at the nearest bar.
Charity Director and event organizer, Lucian Tarnowski, describes Take Heart as “a youth-focused, young charity that has a loyal supporters group of future business leaders.” Take Heart, a purely voluntary charity, directs 100% of its proceeds into providing valuable I.T. training to blind students in rural India, enabling them to get jobs and support themselves, without having to beg. Money made from previous balls has helped build a school, which has now helped several thousand able-bodied students and hundreds of blind students gain a job for life with their new found IT skills. Again, all proceeds from this year’s Ball will go into the next stage of the school’s development.
The Take Heart Committee chaired by Lucian Tarnowski, also includes Simon Ambrose, winner of BBC 1’s The Apprentice, as well as Pete Ward and Jerome Touze, Founders of global social network Wayn.com. The Committee has organized an auction as the main money-making focus on the night with lots being donated by Richard Branson, Virgin Airlines, Swarovski, Breitling, L’Oréal and Aura Ibiza, to name a few.
Founded by Count Arthur Tarnowski in 1963, Take Heart is a visionary charity that has provided aid and rehabilitation to the physically handicapped people of rural India. Wheelchair-bound from his late twenties, Arthur Tarnowski visited India on a two year assessment of the plight of those people with disabilities. There he set up Take Heart with the legendary Baba Amte in partnership with Anandwan and the institution, Maharogi Sewa Samiti. Since then Take Heart has established a working future for thousands of people in rural India. Costing just £37 to provide a six month IT and English language training course per student, this can secure a job for life.
Take Heart holds dear to its principles of actually helping people to help themselves through education and skill training, rather than just giving them money. The Take Heart parent institution has the close support of His Holiness the Dalai Lama.
For more info, visit www.takeheartindia.org.
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Users of Facebook et al resent ads and expect a free service. So how will these sites ever turn a profit?
To some, they are the undisputed darlings of web 2.0, spearheading a virtual revolution that will replace the net as we know it with a connected world where status, street cred and even employability are determined not by the old credos of class, geography and education but by the number and quality of nodes on your personal global network. T
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Users of Facebook et al resent ads and expect a free service. So how will these sites ever turn a profit?
To some, they are the undisputed darlings of web 2.0, spearheading a virtual revolution that will replace the net as we know it with a connected world where status, street cred and even employability are determined not by the old credos of class, geography and education but by the number and quality of nodes on your personal global network. To others, social networks such as Facebook and Twitter are the last word in navel-gazing - online platforms for the swapping of trivial opinions by the terminally self-obsessed.
Whichever side of the fence you prefer to be on, if the grand vision promised by the boosters is to stand a chance of coming even halfway true, the big social networks will have to start doing something that they have so far singularly failed to do - making decent, sustainable profits. The question being asked with growing urgency out in the real world, where the wheels of commerce have yet to become frictionless and still need greasing with plenty of moolah, is: can they ever do so?
Some veterans of the dot.com bubble of the late '90s have their doubts. Michael Wolff, American author of Burn Rate, the most compelling first-hand account of life in Silicon Valley in that frenzied period of boom and bust, is one. 'Social media is based on the internet model, and we are right to be alarmed by that model. It creates moments of intense enthusiasm, but they do not - cannot - last.'
Enthusiasm is the word. Facebook has signed up a mindboggling 300 million users in just three years. That's a fifth as many followers as the world's largest religion, Christianity, has accrued over two millennia, and it's still growing fast - five million new users a week.
Founder Mark Zuckerberg's ambition is also of biblical proportions. He wants to get to a billion users in a year or two, and - having turned down at least one billion-dollar offer, from Yahoo! - shows no inclination to sell out. Facebook has attracted a zealous following from the investment community - the purchase of a 5% stake by Microsoft in 2007 valued the company at $15bn, although more recent share sales suggest $5bn is closer.
And yet in its more established territories, Facebook is already old hat. How long can it find new markets where punters still think it is cool, to make up for those where it has passed into the ranks of the web establishment?
Blake Chandlee, commercial director EMEA for Facebook, is ex-Yahoo! and was Facebook's first international employee, way back in 2007. He is confident the firm has what it takes to stay at the top for a while yet. 'How do you avoid being blindsided by the next big thing? I asked Mark (Zuckerberg) exactly the same question when I went for the job,' he says. 'He really wants to connect users, to make Facebook more of a utility than a content-driven thing, like some other social sites.
'Facebook is about nodes and edges - it enables you to keep in touch much more effectively with people at the edges of your network, people you might know only superficially, than you can in any other way. That has real global appeal, more so than content plays.'
At least Facebook has viable revenue streams - it makes money from advertising on the site, and is exploring other sources of income, such as stored credit, which users can spend on the site, and a new VOIP telephony service to compete with Google and Skype.
Last month, Zuckerberg announced that Facebook will be cashflow-positive this year, which means that it will earn more in revenues than it spends on capex - a vital turning-point for any start-up.
But it's very cagey on exact figures. Even mundane facts such as employee numbers are not 'officially' public (it's around 1,000 people, by the way) and revenues and expenditure details are closely guarded secrets. 'Leaked' estimates suggest annual revenues of around $500m and climbing fast, prompting sceptics to wonder why getting cashflow-positive has taken Facebook so long, and whether it can sustain such a frenetic pace of growth and technological diversification without burning out.
Twitter, meanwhile, the uber-fashionable new kid on the block, has much less in the way of visible means of support. The micro-blogging site was founded in 2006 but didn't really get going until last year. It now has 45 million users, of which nearly three-quarters joined in the first five months of this year, according to data from Twitter research specialist (yes, such firms do exist) Sysomos.
Endorsed by celebs such as Stephen Fry and 'Mr Demi Moore' Ashton Kutcher, it has attracted more than $100m of funding. That includes $35m raised at a valuation of $250m earlier this year, and $50m or so raised last month at an eyewatering $1bn valuation. All for a company with no clear source of income.
The unprecedented - and to some inexplicable - mass appeal of posting short (140 character) messages on any subject at all in real time on the Twitter site seems to have taken even founders Jack Dorsey, Biz Stone and Ev Williams by surprise. They neglected to work out a business model before they got started - a source of embarrassment now that they've hit the big time. Having maintained since very early days that it would never look to advertising on the site to make money, Twitter recently changed its terms and conditions to allow it to do so - in theory, at least.
In July, it was reported that Twitter had spent $15m getting to 30 million users, so, compared with those profligate '90s dot.coms, it is prudently managed and should have plenty in the kitty. So why the need for this latest round of funding? Sceptics suggest that the founders are keen to extract as much cash from the VCs as possible before the true scale of Twitter's 'monetisation problem' becomes a deal-breaker.
The question of whether to go for growth or profit is a classic social-media dilemma, says Nic Brisbourne, partner in venture capital firm DFJ Esprit. 'Does profit matter? Yes, in the long run it matters tremendously. Any business is only worth the sum of its future net cashflow, and without profit you haven't got any of that. But the key phrase is "in the long run". The revenue potential of a business like Twitter or Facebook is theoretically proportional to its user base, so providing you have the capital to cover your losses, it make sense to grow the user base. That's adding more value. But you have to transition to thinking about profit.'
He believes that Facebook has passed this financial rubicon, but that Twitter is not yet in a position to. 'Facebook is clearly in revenue mode - there's definitely a viable business there. The question is: will it be a Google, or will it be an AOL? But Twitter is right at the beginning of the cycle - it doesn't have the revenue to go for profit, even if it wanted to.'
The question bothering investors in social media must be: how long will it last? It is the pace with which these bursts of fame and fan-dom succeed one another, says Wolff, that makes the social networking business model suspect. Dominant players can rise and fall so quickly that they never have time to earn investors their money back.
Look at what happened to MySpace, the first social network to make it really big, he says. 'There's a company that pretty much created the market, had a potential valuation of some $20bn at one point; now it's the sick man of social media.'
MySpace collected 50 million users in two years, a number that looks less impressive today than it did then only because of the extraordinary numbers subsequently posted by Facebook. But it rapidly lost its mojo in the face of its sharp-elbowed new rival. It has now made 30% of its workforce redundant and is bleeding ad revenue at the rate of 15% per annum. Being acquired by Rupert Murdoch's News Corp - whose lamentable record in the online arena is well known - didn't help.
Even Zuckerberg and his all-conquering chums may not get much more than an hour or two in the sun. Peter Cook once said of arch-rival David Frost that he 'has risen without trace'. The same could be said of Twitter, which, revenue or no, is now clearly way cooler than dreary old Facebook, at least for the opinion-formers of the online community.
In such a world, where both technology and user behaviour are transient, little can be taken for granted. 'It's a Facebook game now, but what happens next?' asks Wolff. 'Will Twitter upend Facebook? Will Facebook acquire Twitter? Suddenly, we're talking about a strategic defence of a business that hasn't even defined what it is. What are they preparing to defend exactly? We don't know.'
The UK has its own, smaller, cautionary tale in Friends Reunited. Bought by ITV for £120m in 2005, when it had 15 million members and solid revenues from advertising and paid subscriptions, its model was undermined by the arrival of Facebook - yes, them again - which offered better functionality for free, as well as a much bigger hype machine. Although profitable in 2007, it rapidly went into reverse, and when ITV disposed of what remained of Friends Reunited earlier this year for a paltry £25m, it made a thumping loss of £95m.
But it's easy - and often unproductive - to knock new ideas before they've had a chance to prove themselves. Let's retreat from all this naysaying and take a rational look at what is going on. Are social networks really inherently hard to monetise, or is the conspicuous lack of profit from some players simply a natural part of early-stage business life?
It's the latter, argues Facebook's Chandlee. 'Where we are at is consistent with business trends for the last 100 years. It amazes me that people so often say we are not monetising; I think we're doing a pretty good job. The pace of change here is like nothing I have ever seen. We're clearly building a robust and commercially viable business.'
Furthermore, it's simply not true that social networks can't turn a profit. Many do, typically the niche players whose backers don't have quite such deep pockets and whose businesses were built from the start with ROI in mind - firms such as LinkedIn, a network for professionals which has inevitably attracted the moniker 'The Facebook of business'. Since it declared itself profitable in 2007, it's arguably more successful than its bigger and better-known rival. But, like Facebook, it also plays its financial cards close to its chest: revenue and profit figures are not revealed.
The quantity of its membership may not be in the premier league - 43 million - but their quality is outstanding, says Christina Hoole, marketing director for Europe. 'Eighty-one per cent are university-educated, the average age is 41 and the average income is £75,000.'
Those are the kind of numbers to make any advertiser drool. And, in a sector where the pedestrian reality of making money can often look like an afterthought, its business model is copper-bottomed. 'Our revenue model is mixed - roughly one-third each advertising, subscriptions and corporate solutions,' says Hoole.
Ironically, sales to corporates have been particularly strong during the downturn, because using LinkedIn as a recruitment tool helps clients to do their own headhunting - at a fraction of the price charged by specialist recruitment firms. 'You can seek out both active candidates - those looking for a new job - and passive ones. These are the people who aren't looking but might move for the right offer.'
Adds Hoole: 'We're in a privileged position, because people's professional networks last for life; they take them from job to job.'
It's also easy to forget that social networking is a young sector, and that people are still feeling their way in it. There's a lot more value to come, says Peter Ward, co-founder of another niche player, UK-based social network for travellers Wayn.com. Wayn may have 'only' 15 million members, but it has been profitable almost from the start, he says. 'There's this idea that all social networks are the same. They are not. We can do more specialist, focused things on Wayn that they couldn't do on Facebook.
'Social media has plenty of untapped value, but a lot of people who claim to understand social media don't. Success depends on using the power of the medium and understanding the psychology of your users.'
Twitter's lack of obvious revenue streams has led to speculation that the firm's best hope for the future is to get up the noses of bigger rivals in order to encourage them to buy it out - something it has managed with considerable aplomb. Rumour has it that at least one such approach has been rebuffed by Twitter's top team. Did they not want to sell, or was the price too low? Only time will tell.
Internet veteran Brent Hoberman, the co-founder of Lastminute.com who now heads up the PROfounders investment fund, thinks a sale could be on the cards for Twitter. It certainly worked well for his investment partner Michael Birch, who sold the social network he founded, Bebo, to AOL for $850m last year.
'Microsoft, Google, Facebook - they'd all like to buy it,' he says. 'The question is, would a sale kill it?' In other words, how many users would desert a corporate-owned Twitter on a point of principle? Hoberman doesn't think it would amount to many. 'Maybe the techies who were on there first would stop, but in the mass market I don't think many users would care very much who owned it.'
Facebook's Chandlee points to another advantage enjoyed by social media that should certainly please the traditionalists. 'We are fiscally very conservative, we keep our employee base low. Plenty of people here went through the dot.com crash; they know what that felt like and they don't want it to happen again. Comscore says we're the third most popular website in the world, and we've done that on less than 1,000 employees - fewer even than Google.'
So will social networking ever pay? Almost certainly, yes. You may not share the desire to broadcast your entire personal life to the world on Facebook, or share your every waking thought with the Twitterati, but a lot of people do - these are some of the fastest-growing businesses on the planet. 'I'm optimistic that sites with mass scale, and well-differentiated niche sites, will do well,' says Hoberman. 'The middle market will struggle.'
After all, as Michael Wolff admits: 'You have to say that if it's not possible for someone to make money out of the intense engagement of all the millions of people who use social network sites, we might as well all give up.'
Good point. Someone should Tweet it.
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ADS, DATA AND APPS - Where the money comes from
For a medium that prides itself on novelty, the lion's share of revenue generated by social networks still comes from a traditional source - advertising. Despite the hunt for alternative sources of income, this won't change quickly. 'For the foreseeable future,' says Facebook's Blake Chandlee, 'advertising will remain the dominant revenue stream.'
The received wisdom is that if people in social networking mode are less receptive to ads than those merely browsing, but social networks know a great deal about the habits and proclivities of their users. That kind of data should allow them to identify precisely targeted audiences, something the internet has long promised but never quite delivered. Hence the ongoing battle over who can do what with all the personal data that users type into social network pages. 'So far, a lot of online advertising has not really added much to what can be achieved in a magazine,' says DFJ Esprit's Nic Brisbourne. 'That will change.'
So expect to see a raft of more sophisticated techniques, from product placement via interactive ads to the 'engagement' model, which tries to make ads more palatable by encouraging feedback from users. Some professional-interest sites have better data than mass-market rivals.
There should also be a good business in selling data on what people are saying about brands to corporate clients - 'analytics'. 'It comes down to whether you can influence people's buying behaviour without upsetting them. I think the answer is yes,' says PROfounders' Brent Hoberman.
The other possibility is in the topsy-turvy world of apps - small pieces of software designed to run on top of a social network and to do something users find fun or useful: Tweetdeck on Twitter, for example, or Facebook Connect.
Developers don't get charged for using the underlying platform to sell their app. So although Twitter itself makes no money, several developers are doing very nicely off the back of it. Will Twitter use some of its war chest to snap up the most successful apps?
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We sat with Jerome Touze of WAYN at the Microsoft BizSpark Summit to get the latest development since we last met.
He shares the insights and challenges facing a mature social media company. Liste
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We sat with Jerome Touze of WAYN at the Microsoft BizSpark Summit to get the latest development since we last met.
He shares the insights and challenges facing a mature social media company. Listen for insights on how to take your sales team in-house after long term outsourcing to agencies, why taking feedback from ‘your elders and your betters’ is worthwhile and how to tailor ad engagements to generate strong participation from your community and value for your advertisers.
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Munich/London, WAYN, the world's leading lifestyle and travel social network, has teamed up with global camera network earthTV. WAYN users can now plan even more life enhancing trips or share their meeting memories with real-time plug-ins to the hot cityscapes, chill out beaches and even the majestic mountains captured by earthTV.
earthTV is all about connecting people and video from its cameras and already reaches over 2 billion TV peopl
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Munich/London, WAYN, the world's leading lifestyle and travel social network, has teamed up with global camera network earthTV. WAYN users can now plan even more life enhancing trips or share their meeting memories with real-time plug-ins to the hot cityscapes, chill out beaches and even the majestic mountains captured by earthTV.
earthTV is all about connecting people and video from its cameras and already reaches over 2 billion TV people worldwide through earthTV's global broadcasting clients. This, the biggest TV audience reach achieved by any European television company, is augmented by earthTV.com, the company's 24/7 online channels and its revolutionary earthTV-webTV Player which gives direct access to cool destinations, weather reports, shopping guides and great accommodation - everything that globe-hopping WAYN users need to plan their perfect reunion or meet up with the new friends they make on the WAYN site.
Thomas Hohenacker, CEO and founder of earthTV and its mother company Telcast GmbH in Munich, comments; 'WAYN, with its commitment to bringing people and friends together and building a worldwide community, is a perfect partner for earthTV which is built on universal amity and cultural insight. earthTV's global camera network is of quality one in the world and our new Player with its contemporary regional, national and international video on demand (VOD) is an ideal tool for WAYN users looking to hook up or virtually research some of the most exciting destinations our planet has to offer.'
WAYN has signed up to earthTV's LIVE streaming, best of clips and last 48 hours - all features that illustrate earthTV's Player ability to meet the ever changing needs of WAYN's vibrant networkers.
Peter Ward, WAYN's co-founder and co-CEO says; "WAYN is all about helping its members to gain inspiration for future trips and experiences with friends or people they meet on the site. By showcasing some of the world's leading destinations through earthTV's real-time camera views over captivating horizon's, we aim to inspire our members to visit these places and share their own travelling experiences with others"
To view the player go to Travel Guide and check out the destination pages.
About WAYN
WAYN (Where Are You Now?) is the world's largest lifestyle and travel social networking community with over 15 million members worldwide. WAYN helps like-minded people plan, find, meet and share dreams, aspirations and experiences with others.
www.wayn.com/waynsplash.html
Contacts Marta Datkiewicz, Marketing and PR Manager, Where Are You Now? Ltd
About earthTV
earthTV is the most successful daily LIVE programme out of Europe, reaching over 2 billion Television viewers in 200 countries and regions - available in any language and station design, delivered LIVE every hour, 24 times per day. earthTV’s spectacular 90 seconds LIVE programming airs on more than 60 TV channels around the world, including CenterTV (Russia), CWTV (China), Al Arabiya (Middle East), France2 (France), Sky Travel (UK), N24 (Germany), SBS (Australia), The Weather Channel (USA) and NDTV (India). earthTV content is also available on selected mobile and 3G platforms, and on airport media. In January 2007 earthTV launched its new online platform www.earthTV.com.
Contacts Evelyn Dathe, PR & Marketing Manager, TELCAST Media Group GmbH, T +49 89 208 06 770, F +49 89 208 06 606, evelyn.dathe@telcast-group.tv or Stephen Roberts at Roberts Laurence, T: + 44 (0) 1780 460777, email robertslaurence@mac.com
Marta Datkiewicz Marketing and PR Manager Where Are You Now Ltd [WAYN] T + 44 (0) 7336 8088 , email marta@wayn.com
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The Tourism Authority of Thailand (TAT) announced the Ultimate Thailand Explorers campaign www.ultimatethailandexplorers.com, an online marketing activity targeted at foreigners who have been invited to send original video auditions to become one of five teams to compete in the Ultimate Thailand Explorers competition.
Each of the five teams of
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The Tourism Authority of Thailand (TAT) announced the Ultimate Thailand Explorers campaign www.ultimatethailandexplorers.com, an online marketing activity targeted at foreigners who have been invited to send original video auditions to become one of five teams to compete in the Ultimate Thailand Explorers competition.
Each of the five teams of finalists will have six days and five nights in one of five chosen locations - Bangkok, Phuket, Chiang Mai, Samui, and Pattaya - in order to explore and fulfill given assignments: the task for each team is to explore the attractions and activities and then upload pictures, write blogs, and upload videos via numerous sources of online social media. The winning team, the one that gets the most online votes, will receive a cash prize, holiday package, and other prizes worth US$15,000 in total. More importantly, the purpose of the event is to inspire international travelers to set their feet on Thai soil.
Suraphon Svetasreni, Deputy Governor for Policy and Planning, said: “This campaign will improve the perception [of] Thailand as contestants will see by their own eyes what it is like during their stay; therefore, it promotes an improved understanding amongst international press, especially those of great influence like bloggers, who travelers are more likely to believe. The ultimate goal of this campaign is to encourage and expand Thailand’s virtue and to rebuild confidence in international travelers.
"We have [been] publiciz[ing] via online media since September 1, 2009, launching a website, stirring interest by means of social media, and social networking such as youtube, Facebook, Myspace, and Twitter. We made a direct marketing approach to travelers through the most reputable traveler websites such as WAYN (Where Are You Now). Strikingly, this campaign has captured the attention of digital travelers because even though only two weeks has passed, there have been 52,871 visitors and 16,770 views of the video campaign. These figures are considered the highest numbers since TAT’s first online campaign resulting in approximately 155 teams of applicants to date.”
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Travel and Mobile Leaders Discuss Vision of Mobile’s Power, Challenges for Travel Industry
London – September 22, 2009 -- DataArt, a high-end software development company headquartered in New York with R&D centers in Eastern Europe, will host an executive panel on emerging mobile technology strategies for the travel industry on October 15 from 16.00 to 18.30 in central London. The panel is the first in a planned series of such events to b
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Travel and Mobile Leaders Discuss Vision of Mobile’s Power, Challenges for Travel Industry
London – September 22, 2009 -- DataArt, a high-end software development company headquartered in New York with R&D centers in Eastern Europe, will host an executive panel on emerging mobile technology strategies for the travel industry on October 15 from 16.00 to 18.30 in central London. The panel is the first in a planned series of such events to be hosted by DataArt, and will feature candid discussion between leading travel and mobile industry leaders, including:
• Graham Leslie, president, IXeo and VisitAfrica.com, and former CEO of Serena Hotels and SVP of Kempinski Hotels.
• Jerome Touze, co-Founder and co-CEO, WAYN - Where Are You Now? Ltd
• Lynda Bott, director, Hyatt.com
The evening’s session will be moderated by Graham McKenzie from TravelMole, who will lead the discussion around how mobile technologies are reshaping the way consumers plan, book and consume travel services. The discussion will further explore how the increasing consumer demand for such mobile applications is causing travel companies to revolutionize existing global IT operations strategies to make their services more mobile-friendly.
“As mobile technologies continue to grow at a tremendous pace, the travel industry is quickly proving to be a hot point for showcasing just how ubiquitous and versatile mobile apps are becoming,” said Marina Kolesnik, head of travel and hospitality practice at DataArt. “However, with such ubiquity, complexity and dynamism comes real challenges about how to effectively incorporate mobile technology into new IT operations plans, and make accessing such services easier for customers. With this panel, attendees will get to hear from both sides of the equation about how this evolution is taking shape and the potential it carries.”
To secure your spot at this leading-edge industry panel event, please contact Anna Grevtseva at anna.grevtseva@dataart.com.
About DataArt:
DataArt is a high-end software outsourcing company with industry-specific expertise in financial technology, online travel, telecom and media sectors. The company specializes in enterprise application development, system integration and business automation tools. In 2006-2009, DataArt has been named one of the world's top emerging outsourcing providers by BusinessWeek, Global Services 100 and by International Association of Outsourcing Professionals. Headquartered in New York City, DataArt runs four R&D centers in Russia and the Ukraine, and maintains offices in London, UK.
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WAYN co-founder Peter Ward on why he loves La Cucina, an Italian restaurant in central London. We like to take important clients to La Cucina, an Italian restaurant on Cowcross Street, nestled between Farringdon and Barbican in central London. It's got the combination of style, good value for money, ambience and an attentive staff. Because we spend so much time there, we can recommend favourite dishes to our guests. The pastas are outstanding and
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WAYN co-founder Peter Ward on why he loves La Cucina, an Italian restaurant in central London. We like to take important clients to La Cucina, an Italian restaurant on Cowcross Street, nestled between Farringdon and Barbican in central London. It's got the combination of style, good value for money, ambience and an attentive staff. Because we spend so much time there, we can recommend favourite dishes to our guests. The pastas are outstanding and the staff are very accommodating - they'll incorporate extra chilli and other ingredients into the dishes if asked. One of the dishes, quadroni di magro, comprising fresh pasta filled with spinach and ricotta, wild mushrooms, asparagus and tomato sauce, is so good I frequently order a portion and a half.
Unusually, this restaurant is also celebrated for its traditional English dishes: fegato - calf's liver, bacon and onions - is one of La Cucina's most popular main courses.
La Cucina has a bit of a retro feel to it. The walls are adorned with pictures of traditional Italian brands and people who were famous in Italy. I know that whoever I take there will feel welcome immediately. There's a guy waiting outside who always says hello and opens his arms wide. He's very Italian - proud and passionate. Combined with the excellent food and service and our knowledge of the menu, it's a winning combination.
We've taken a range of people to La Cucina, from staff to key strategic clients - and, recently, Simon Guild, who is now our chairman.
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