Two items I came across today were interesting to me because I have been thinking along the same lines. While I am a true fan of both Second Life and Twitter and think the potential for business is unquestionably there, I have been taking time to consider what has been going on. It is not limited to these two examples, but they serve up the points well.
First, this article from WIRED on How Madison Avenue Is Wasting Millions on a Deserted Second Life. While it did not reveal anything drastic or new, it looked at the situation with a somewhat sobering viewpoint.
Then, there was this post titled Stupid Question: When *WILL* Having A Business Plan Matter? from Tony Hung over at Deep Jive Interests. Tony raises a great point about the lack of an underlying business plan to generate profit.
If we take anything from the above examples, it is that we can’t get caught inside the irrational-exuberance storm all over again. Yes, we get that Second Life is not about reach and that experimentation is the cornerstone of tomorrow’s success. We understand Twitter is an addictive little platform, connecting people in new ways and attracting loyal followers by the thousands. Both are representative of a the giant leap forward in how we think about where the internet is reshaping our lives and businesses.
In my mind they are strong catalysts for marketers to image new ways of communicating and developing new core audiences for their brands. But are these two properties themselves the next big thing, or are they the forerunners of what could be? Twitter and Second Life (along with others in the space) are getting a lot of attention and buzz with Fortune 500 companies and new sources of capital getting on board. While that may seem great, one must remain concerned that without solid foundations, structures tend to collapse.
Ultimately, I fear a scenario where those brands or investors who have not realized immediate success from these areas simply bail out. The phenomenon they hoped to be a part of is unrealized in the ways they expected or were promised. They lose patience and depart, fast and furious. In doing so, they cause others to follow them and speak of the experience in unflattering ways.
To a certain extent, a cull is necessary. But within that culling process there is certain potential to breed a new kind of chatter or hype. Hype about how new media and virtual worlds etc. were all just hype in the first place. Such talk would devalue what we know is really going on here.
When malcontents talk of ineffectiveness in Web 2.0 as they chase trends without strategic underpinnings, industry growth risks being stunted and true potential will be left sitting on the table while a few well-heeled folks make out like bandits. The big implication if sentiment swings the wrong way is that marketers and brands in this space will fight an uphill battle for legitimacy all over again. Hello 2000 A.D.
The unfortunate part is that those who have already delivered in the digital space are most likely to take a hit. In other words, those of us who have benefited from applying the proper fundamentals in digital channels may get caught up in a downside we cannot control. This is not unlike how everyone has to get out of the pool when just one kid pisses in it. No fun. (Remember Bill Murray in Caddyshack cleaning the pool?)
Or, maybe that is the difference today in 2007. Maybe we should not worry about digital losing its groove again. We’ve come too far for that to happen all over again.
I say all this because, for those not paying attention, we still live in a capitalist world where (for the most part) businesses are grown on their ability to take great ideas (or even not so great ideas) and turn them into reliable profit streams. I know I may sound like an old economy fart who is kicking back smoking a corncob pipe when I say we need caution and “steady as she goes” navigation as Web 2.0 businesses either prove themselves, or don’t.
At this stage of the game, fundamentals need to be way more important then they have been or seem to be. Otherwise, it might take an awfully long time and a bumpy road ahead to show where the true value lies.