Nothing Lasts Forever
The news this week is that ITV will shortly sell Friends Reunited and with a couple of interested bidders, there are expectations that it could be yours for around £40m. Not bad in this time of economic recession.
Or is it? I’m no city financier, but given that ITV paid a reported £175m for the site and brand when they bought it just four years ago, maybe all of a sudden it doesn’t look like quite such a good deal.
Perceptions are everything online as many people found out to their cost in the first dot com boom and bust. Companies received astronomical valuations and then proceeded to implode gloriously.
In hindsight we can look back a little disdainfully and a trifle smugly at what went on. Personally I don’t believe a lot of what was said at the time was actually wrong; the visionaries were just about 10-15 years ahead of the game. But that’s what visionaries do.
Everyone’s scrabbling for the next big thing, whether that’s the new Facebook, Amazon or Google. In 2006 Mark Zuckerberg turned down $1bn from Yahoo for his Facebook site. At the time many people thought he was mad (I still do in some ways), but the brand has gone from strength to strength and the only potential issue might be the fact that the revenue generation is still nowhere near the projected valuation.
Time will tell. And that brings us back to Friends Reunited. Once it really did enjoy the same kind of status of Facebook, albeit for a smaller number of people. Many of whom possibly had slight stalker tendencies (I guess some things don’t change).
Brands are built on relationships and relationships are a two-way thing. In the ‘real’ world (and I’m starting to struggle to work out which is which), many brands rely on a financial investment to generate that relationship. You give them your money and they give you their products and services. It builds loyalty – most of the time we all like to think a little about who gets our money after all.
The challenge for these sites is to create that investment in other ways, and this is typically time. The more time you spend updating your profile online, adding content, pictures, joining clubs and groups, the harder it is to walk away.
Like any organisation on or offline, brand loyalty is what marketeers strive for and that’s the investment that Facebook has got us to make far more effectively than Friends Reunited ever did. The more time and effort we spend the less likely we’ll be to move on.
Longevity is the holy grail of online brands and just like any long-term relationship it works best when both sides put a bit of effort it.
Whether Facebook will stand the test of time, who knows? It will be interesting to see where Friends Reunited goes and whether it will be able to reinvent itself.
Perhaps I’ll head off and set up ‘Websites that were going to change the world Reunited’ and see if I can get it to join up?