Why you don’t see ads on Biznik
Last April, we began a three-month-long experiment with advertising on Biznik. Our thinking: Why not give the 95 percent of free members an opportunity to help us keep the lights on?
The experiment didn’t work. Ad clickthrough rates were so low, that two of the advertisers demanded their money back (and we gave it to them). Intuit, which was a pleasure to work with and did NOT demand their money back, decided wisely not to renew their sponsorship after just one month. Intuit surveyed members both before and after the experiment, and learned they actually LOST a tiny fraction of brand recognition and credibility as a result of their experiment on Biznik (although the difference was within the survey’s margin of error).
Lesson: advertising on Biznik doesn’t work. So we dropped it and haven’t looked back. Instead, we’re focused on what does work - providing good value to free members, and EXTRAORDINARY value to paid members.
It turns out that we aren’t the only social network to discover that traditional advertising doesn’t cut it. Here’s what marketing guru Seth Godin had to say today about advertising on social networks:
“Big companies are asking precisely the wrong question. They are asking, “how can we use these new tools to leverage our existing businesses?” They want to use the thing they have (money) to get the thing they need (attention) and are basically trying to force ads onto a medium that just doesn’t want them.”
Seth goes on: “Traditional advertising is inherently selfish. It interrupts in order to generate money (part of which pays for more interruptions). That approach doesn’t work at a cocktail party, or at a funeral or in a social network.”
One of the things I love about running a business is making mistakes … and learning from them. As I look around at the number of social networks attempting to make ends meet with advertising, I’ve at times been tempted to think, “man, they must know something I don’t.” After reading Seth’s post, I’m having a different thought. Why are they trying to force an old business model based on scarcity onto a new medium that’s based on trust?
January 13th, 2009 at 7:36 am
[...] at using the internet to deepen human connections. In a recent post to… Read More at http Why you don’t see ads on Biznik - blog.biznik.com 01/12/2009 Last April, we began a three-month-long experiment with advertising on [...]
January 13th, 2009 at 10:23 am
Dan… Thank you for your vision and initiative to build the Biznik network in your way. I personally favor Biznik over all the others and I’m sure this is one of the reasons. I constantly encourage people to become supporting members so we can keep Biznik as Ad Free as possible.
I really like your statement “…providing good value to free members, and EXTRAORDINARY value to paid members. ”
I will do my best to help Biznik by providing beneficial and good value events. …Howard