Recently, Wal-Mart has launched a site called "The Hub" which targets teens and encourages them to "express their individuality" by adding a song, pictures and a fashion quiz to their profile. While seemingly allowing teens to create their digital self, the social aspects of the site are non-existent, relying on teens' love for shopping (hmm) at Wal-Mart to be the primary lure for signing up.

MTV, a much cooler brand, will launch a site called "Flux" in conjunction with a new MTV UK channel which will allow community members to choose the music videos shown on the channel, upload their own videos, send text messages from their mobile phones to be shown on-screen, and communicate with each other.

While users will be able to communicate with one another, it remains to be seen as to whether it will actually be a social networking site, as the concept of "network" has yet to be mentioned with regards to the service.

Additionally, new software packages and services, such as KickApps, are arising that allow companies to offer their own SNS almost as easily as creating a Myspace profile. As KickApps CEO Eric Alterman told the Online Reporter, the goal is "to provide Web sites with a solution so they have 'nearly a 0% barrier to entry' into the social networking and video sharing market." And while the addition of an SNS to a company's website, with little to no cost to implement, is certainly worthy of a press release, in many cases it misses the point of social networking altogether.

What is social networking?
Quite simply, there are two parts: the social part and the network part. The site has to be social; that is, people sign up, create profiles, and engage aspects of the SNS in order to socially interact with other members on the site. Regardless of the love they may have for the product or brand, it is the social interaction that is sought. This may seem painfully obvious, but the folks at Wal-Mart missed it when creating "The Hub" - a so-called social network site that does not allow messaging or interaction between members.

The second part regards the networks that are created by connecting members to one another. The reason Myspace is number one in traffic is that so many people spend a significant amount of time browsing through the many pages Myspace has to offer. Specifically, they browse to the profiles of their connected friends and then through their friends' networks. The ability to view one's own network and the networks of others keeps the user in the Myspace domain. Without the "friends" on Myspace or "connections" on the business networking site LinkedIn, these sites would merely be profile pages or "cookie-cutter" websites for individuals.

Metcalfe's Law
Another way in which brand-specific social networking sites miss the point is that much of the recent success of Myspace has been due to the large number of people that are currently members. At this point, so many are on-board that many teens just assume that their classmates are members; "What is your Myspace?" has in many cases replaced "What is your phone number?" In fact, Metcalfe's Law is particularly relevant. The law, which pertains to telecommunications networks, states that the value of the system is proportionate to the number of the users of the system (i.e. "friends") squared. With Myspace currently showing more than 97 million member accounts, no brand-specific SNS can hope to even scratch the value of the Myspace network. Although it is not necessary to compete with Myspace to create a successful SNS, it will be quite difficult to attain a number of members significant enough to give the site any value.

While Wal-Mart's Hub and MTV's Flux (though it remains to be seen) may not qualify as social networking sites, NHL.com has also announced plans to offer social networking through their site. Similar to other SN sites, the site will allow NHL fans to create profiles, interact with others in the NHL community, post comments, photos, podcasts, video casts, and create links to friends or colleagues. But the sites value remains to be seen:

• It must first engage a critical mass of members in order to give the site any value;
• The question remains as to whether sports fans desire this level of interaction and communication in such a niche group; and
• Users must see the value in choosing the niche SNS over the more general, where more of their friends and colleagues are already gathered, for discussing hockey.

While adding SNS capabilities to a company's website is relatively easy and inexpensive, it seems that there is more value in working with the existing and popular social sites. While SNS will likely generate more page views among a small group of users - which is no doubt valuable - the value of the network for marketing purposes exists in exploiting the ties between the millions of members; this is fundamental to viral marketing. It may therefore be better to invest in the relationships of those that are most loyal to the brand, and let the ideas spread throughout their connections.

On the other hand, any company that is starved for press attention can capitalize on this year's hot button: social networking.

Related Links:
Wal-Mart - http://adage.com/article?article_id=110520
MTV - http://www.pcmag.com/article2/0,1895,1993533,00.asp
NHL.com - http://biz.yahoo.com/prnews/060712/sfw074.html?.v=58
Sparkpeople.com - http://biz.yahoo.com/prnews/060712/nyw030.html?.v=66

A PDF version of this article can be downloaded here.

About the Author
Dale Gilliam is Director of Primary Research of The Diffusion Group. He works closely with primary research in fielding and data analysis, and supervises the development of TDG's syndicated consumer-research offerings (Consumer Snapshots).