Monetizing Online Communities

Earlier this week MediaPost.com published an article written by Alex. The article talks about how media companies are using social media and monetizing online communities that they’re created around their websites. In the article he talks about VIBE Verses and its partnership with MySpace to promote VIBE Verses 3. Check out the article below or at MediaPost’s Online Media Daily.

Monetizing The Universe Of Niche Communities
By Alex Blum

I have a great deal of admiration for MySpace and Facebook. There’s no doubt that their success has been instrumental in moving social media into the mainstream and changing the ways in which millions of people relate to one another and to media companies. But despite their size and influence, they–and the handful of general-purpose social networks like them–represent just one piece of a larger ecosystem in people’s online lives.

There are scores of niche communities, some of which have been around for years in the form of message boards, built around specific topics and demographics. Due to the nature of these sites, they boast highly engaged audiences and often command premium advertising rates. Spurred by a new generation of robust, affordable social media applications, niche communities are quickly becoming a critical part of the social Web.

Indeed, recent moves by MySpace itself should cause media companies, brands, and advertisers to take note: niche communities represent a large and untapped universe of opportunity for those looking to embrace and monetize this emerging space.

Because of their focus on particular subjects or demographics, niche communities are an effective means of fostering deep, meaningful levels of engagement. Sparking conversations with high-quality editorial content, the best niche communities are pros at consolidating audiences with similar values and interests. This translates to numerous opportunities to monetize these sites through standard display advertising, premium sponsorships and ecommerce.

One of my favorite examples of a well-executed niche-community is VIBE Verses, a site owned by VIBE Media, a leading urban culture brand and publisher of VIBE Magazine. (Full disclosure: my company, KickApps, is the technology provider behind the site.) Launched in May, VIBE Verses is an online community for hip-hop fans with a unique centerpiece: an “American Idol”-type contest for aspiring rappers. Artists upload videos of their performances and are encouraged to market their work on other sites through viral video widgets. Each of these widgets acts as a gateway back into the VIBE Verses community, where fans can view, rate, and comment on their favorite performances. Every few weeks, the rapper with the highest rating gets $10,000 cash and exposure. It’s hardly a groundbreaking idea, but consider the following:

* In a matter of months, the site has attracted more than 80,000 active participants and millions of viewers;
* The project yielded VIBE an 8x return on investment via advertising and sponsorship revenues; and
* VIBE built Verses in under a month using off-the-shelf social media applications. As a testament to the success of the community, VIBE has plans to extend the contest into an ongoing series. For this latest round, VIBE Verses 3, VIBE partnered with the world’s largest social network, MySpace, to deliver a unique contest experience for members of both the VIBE and MySpace communities. Promoted to MySpace’s 72 million plus members, the winner of VIBE Verses 3 was selected by world-famous artist and producer Wyclef Jean, from a group of finalists who were chosen by the community. In addition to the cash prize, the winner won the right to open for Wyclef at his MySpace record release party in Los Angeles.

You may be asking yourself what MySpace stands to gain from a partnership with a niche community like VIBE Verses. Through this relationship, MySpace is able to leverage and associate itself with a premiere brand in a highly sought-after market segment. VIBE, on the other hand, can leverage MySpace’s massive audience to drive exposure of their brand and highly engaging programming. This in turn enables both organizations to package and sell high-value advertising and sponsorship offerings to brands seeking to reach a uniquely engaged audience.

More than ever, media companies and brands are beginning to test the waters of social media to see where it fits into their overall marketing strategies. If the VIBE/MySpace relationship is any indicator, the best brands are recognizing that to leverage both large, general-purpose social networks and highly targeted niche communities in the same campaign maximizes the value we can derive from both.

Online Community Unconference East

A couple of us attended Forum One Communications’ Online Community Unconference East today. When Bill Johnston, the organizer of the unconference, sent me an email to invite us to participate, I have to admit my initial response was, “unconference what?” Having just spent the day at the unconference, all I have to say is, “Unconference is AWESOME!”

For those unacquainted with the unconference (= me 12 hours ago) check out the Wikipedia description here. The 2 second is, everyone gets together, stands up to introduce yourself, an agenda is created on the spot by participants, participants volunteer to facilitate discussions, you choose sessions you want to attend, you contribute, learn and participate. What better way to spend the day talking about online communities with community leaders and managers.

I was able to sit in on two sessions. The first was, “Building Communities: What are the considerations?” This is a topic we’re very passionate about at KickApps. If you haven’t read our white paper on this yet, check it out here. The second was, “Leveraging Facebook and others.” Another topic we’re seeing a lot of momentum around from our clients, check out what VIBE did with MySpace here.

This was probably the first time I’ve been at an event where everyone who attended was so passionate about online communities. People were genuinely interested in learning from and sharing what they’ve learned with others. Even more amazing is the pace in which people are pushing the envelope with social media everyday. I see it everyday with our clients and saw in everywhere I looked today.

As I was leaving I had a brief chat with David of TV Guide Online. We talked about how notable it is that we’re starting to see titles like ‘Community Manager’ and that the unconference was a rare opportunity for community managers to gather as a group. I hope that this is just the beginning.

If you ever get the chance to participate in one of Forum One’s and Bill’s unconferences, DO IT!

A Video Tour of The Affiliate Center

The Affiliate Center is the heart of the KickApps platform. It’s a powerful web-based tool that gives you full control of every aspect of your community and keeps you in the know about everything going on inside of it. From page customization to media management, monetization and more, there’s a lot you can do in the AC, so we put this video together to introduce you to the highlights.