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Executive Interviews: Interview with Andrew T Stephen on Social Networking
May 2010
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By Dr. Nagendra V Chowdary
Andrew T Stephen Assistant Professor of Marketing, INSEAD and a winner of Google-WPP Marketing Research Award (2010) 
As a marketing professor, how do
you describe the advent and the
(near) ubiquitous presence of blogs,
social networking sites, like YouTube,
LinkedIn, Orkut, Twitter, etc? What
do these ‘social’ innovations signify at
a very personal level?
The rise of social media and online
social networking sites has happened
over the last 10 years, and has accelerated
more recently. It has happened
largely due to innovative entrepreneurial
startups in the post -‘Internet
bubble’ period which have figured
out that more valuable, engaging, and
compelling websites (and hence,
Internet businesses) let users interact
with each other. This taps into a very
human, very personal desire to be
connected to others and to share information
with others. This is a fundamental
human need that is now
being serviced in part by all these
kinds of websites and social networking
platforms.
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While some argue that they undermine
the social fabric of a society,
many epitomize them as harbingers of
the end of corporate imperialism.
What, according to you, would be the
unintended consequences (both positive,
as well as negative) of these ‘social’
media?
A key unintended positive consequence
is that people are starting to
feel closer and more connected to
people who they are linked to online
and know only a little offline. People
follow each others’ lives through
news feeds, Tweets, blogs, and whatever
else and that’s a nice thing. The
flipside of that, of course, is the negative
consequence of people feeling less private, and more exposed to others.
But, at the end of the day, it
comes down to one deciding what
one wants to share with others online
and being in control of one's own privacy
and exposure.
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How do you look at the ‘social’
media segments – there are various
types of online social media from social
networks of friends and professionals
to microblogging services, to
video sharing sites, with informal
online network of friends (Facebook,
Orkut, QQ), artists (MySpace), visual
junkies (YouTube, Hulu, Vimeo,
Daily Motion for Videos and Flickr,
Picasa and Snapfish for photos) and
professionals (LinkedIn)? Do you
foresee a proliferation and consolidation
(either sequentially or simultaneously)
in social media segments?
Absolutely, there will be a consolidation
of various websites, social media
platforms, etc. The industry cannot
be sustained with the current rate of
proliferation of new websites and applications
that people have to sign up
to. There is definitely an overload of
usernames/passwords that we all
have to remember. Strategically for
businesses which have a social media
website/service, it is a problem being
remembered – the challenge isn’t just
in building up a userbase but also in
retaining them and getting them to
use your service or login to your
website frequently. So the good ideas
out there will either be copied by the
big players or the technology will be
acquired eventually. One force slowing
down this consolidation is
Facebook Connect, which links external
websites/services to Facebook
through a single Facebook login for the user. Twitter’s API allows similar
functionality, as do projects like
OAuth.
With proliferation, what we will continue
to see is new ideas starting to
proliferate. This is currently happening
with what’s being called ‘Lo-So’ or
location-based social networking. Examples
of these sites are: Foursquare,
Loopt, and Gowalla. There is also a
location feature in Google Buzz and
Twitter, and Facebook is apparently
going to switch-on location-tagging for
status updates very soon. The cycle
seems to be that a new idea comes
out, companies work on the idea and
fight for users and then a few end up
surviving and maturing.
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Every country has its cliques,
whether based on education, social
background or spiritual beliefs. In
Spain, Italy and Latin America, as
well as France, business people speak
of the influence of Opus Dei, a conservative
Catholic lay order which supports
a number of business schools.
America has its Ivy League alumni
groups and Rotary Clubs. Chinese
business people often rely on guanxi,
or personal connections. How then
are the (online) social networks different
from the old-style networks?
They are not all that different. Large
online social networks are often used
for groups of people with common
interests to come together and organize
themselves on an online platform.
Even before online networking
sites, like Facebook and MySpace, existed
there were special interest
groups with online discussion forums
and websites – basically online
clubs that brought together people
with common interests. Where online social networks become different
is in their geographic reach and
greater accessibility. In the offline
world, there are physical limits to
who can/cannot reach whom – if you
don’t live nearby or paths don’t cross
in life, then you’re unlikely to connect
despite having a common interest in a
niche topic, for instance. Moving
online obviously changes this and
makes it easier for people to organize
into groups, societies, clubs from all
around the world and from different
walks of life.
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The Financial Times recently
(March 17, 2010) reported that the social
networking website, Facebook,
has capped a year of phenomenal
growth by overtaking Google’s popularity
among US Internet users, with
industry data showing it has scored
more hits than the search engine.
Facebook’s membership has crossed
400 million (430.2million, as per
comScore) in February 2010 (when it
celebrated its sixth birthday). Is it a
sign that the web is becoming more
sociable than searchable?
People are spending more time on
Facebook (about 55 minutes per day
for the average user as of the end of
February 2010, according to some recent
press reports I read). More time
means becoming more ‘expert’ in using
the service and its various features
(which keep expanding). This keeps
people coming back on a regular basis.
This drives the traffic growth. But
it is a different type of traffic than
Google’s. And keep in mind that this
ignores traffic to other Google sites
(i.e., other than Google.com), so it
isn’t really a fair comparison with
Facebook.com (since worldwide
Facebook traffic through a web
browser goes to Facebook.com – there
are no local variants like Facebook.fr
for France, Facebook.co.uk for UK,
etc).
The web is becoming more social,
that’s for sure, but companies like
Google are working very hard to incorporate
social elements into the
search. Facebook content gets indexed
by Google, for instance.
Twitter’s search engine is a powerful
tool that can be used to search what’s
being said on Twitter in real time (this
is very useful for businesses wanting
to see what people are saying about
them ‘right now’). So I would not say
that web usage is trending to socializing
at the expense of search. Rather
usage habits are changing and social
is becoming a big part of daily routine
on the web
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