Dear Monetization News Daily,

I run a fairly popular social media site with 175 million registered users, a large percentage of who visit at least once a day. My users have filled out profiles, so I know who they are, demographically, and what they are interested in. But, I can’t for the life of me figure out how to monetize this site. Any ideas?

FB en masse

Dear FB en masse,
Holy crap. Pardon our Arabic, but if we at Monetization News Daily had 175 million users, we’d be too busy peeing ourselves in delight to worry about much of anything else. But, we appreciate you taking the time to write, and we do have some ideas that might help put a buck or seven in your pocket.

Ads

We have one word for you – ads.

Advertising has been a money-maker for a great many sites over the last few years. If you’re not running ads on your site, you probably should. You may have considered running contextual-based ads, like Google Adsense, but worry that your content is not focused enough to display relevant ads.

If we had 175 million users, we would approach Google and ask if they would set us up in a special “social media” channel that would display the most popular ads from around their network. This sort of channel does not exist today, that we know of, but you have a large user base, and should have enough pull to put something like this together. You need to start thinking like a business, and not like a website.

One thing to avoid is to try to build your own advertising system. For instance, another social media site, Facebook, built their own advertising system where they sell blocks of space to regular Joes trying to make a buck. The trouble with this set up is multi-fold

• a) All ads must be manually approved by a real person. This is extremely inefficient
• b) The space is filled with crappy products that no one wants, and links to crappy sites that no one wants to visit
• c) The ads feel amateurish, because they are, and this makes Facebook seem amateurish
• d) The average Facebook user is hesitant to click on ads from unknown sources. The bulk of Facebook advertisers are unknown sources (not nationally recognized products or brands). This leads to really low click-through, which turns away these advertisers. Result: No one wants to advertise on Facebook, because Facebook users won’t click. Pretty easy formula.

One thing you should realize is that your user base is larger than the average Super Bowl audience. What’s more, your users keep coming back, day after day after day. Your space is worth millions and millions of dollars. I imagine a nice 200 X 600 banner for a product like Swiffer would pull in a few thousand bucks an hour. With the demographic info that you have, with a little bit of elbow grease, you might be able to customize ads for your users and really bump up your numbers.

Bake Sale

If advertising leaves a sour taste in your mouth, why not use your site to raise money for good causes? No, we’re not suggesting you start selling chocolate cakes to your users, but surely someone somewhere in those 175 million has a cause that they feel pretty strongly about supporting. Maybe you could set up a “causes” module and allow your users to create and contribute to these charitable organizations. You could take a small percentage without feeling guilty.

Most non-profit organizations have an advertising budget and would gladly give up a percentage of their donations just to have the attention of so many people at once. And, if you think that non-profit is not about marketing, take a long, hard look at the be-pinked Susan G Komen campaign and ask yourself how they got so many people to get so jazzed about cancer.

Yes, during difficult times such as these, selling charity is tough. When people start cutting things from their budget, charitable contributions usually get cut first, followed closely by summer passes to Six Flags and subscriptions to beer-of-the-month clubs. But, if you can get people thinking about charity now, when things turn around, you should be golden.

Subscriptions

Let’s do some simple math. 175 million users at one dollar a year equates to 175 million dollars a year. We could live on that. If we were a staff of ten, instead of just one guy pretending to be a “we,” we could still live on 17.5 million dollars a year. Now, we’re sure that with that many users, you probably have some data and hardware costs. Also, you probably have a developer or two on staff to work out the bugs and develop new features.

(Although, if you are developing features that your users suggest – stop immediately. They came to your site because they liked it. Why would you change anything about a site that could attract 175 million people? Leave it alone.)

We have no way of estimating your overhead costs per year, but we do know that if it is approaching 75 million dollars, you are doing some horribly inefficient things. But, even if that is the number, this still leaves you with 100 million dollars a year. And, that is at one dollar a year per user – a number we feel few users would hesitate to pay.

Other quasi-social sites like Xanga and LiveJournal charge $25 a year for their “premium” model. Even if only 10% of your users chose to access your premium service – which would not display ads, and include some great features like customized profile pages – you would still have 17.5 million users paying you $25 a year – or 437 million dollars. That’s more money than we made last year, or for the previous 36 years combined.

Research

We hope we’ve offered you some ideas, FB en masse, but to be honest, none of these ideas is especially earth-shattering and could have been researched on Wikipedia during your lunch break. (Except for the “social media” channel on Adwords – that is pure genius.) Further, this list is by no means exhaustive, as there are at least a half-dozen other ways you could monetize your gigantic user base.

If you are serious about monetizing your site, we suggest you type the term “monetization strategies” into Google, and just read the first few results. We think you’ll find that you are sitting on a gold mine, and that if you’d just pull your head out of your backside, you could own a good portion of the Eastern United States, plus Oklahoma.

All our best,

MND