Advising on the Purchase of Myspace (ouch!) - briefing for financial analysts advising Fox Interactive / NewsCorp

Social Networks are the new malls. 2

But these malls are built by users. Without any rules. • Users are connecting with each other, goofing around, and sounding off 3

People are putting their real lives + personas online. • baring their souls online in exchange for human connections • Movies, Books, Friends – profiles are people’s lives on public display. This is the stuff they pin up inside their lockers. 4

for a long time, consumers have been coming to advertising spaces. 5

but now, advertisers are coming to a consumer-created space 6

how can advertising remain relevant in this space? 7

“The spirit of social computing is the spirit of leaving value in your wake” > Bradley Horowitz, Technical Director - Yahoo 8

Companies who do this will take the prize. 9

let’s see how marketers are using the space 10

Allowing users to play with brand identities: Axe - GameKillers • Make the characters more real by creating custom personas and fictional MySpace profiles for each of them, which users can add as friends • The profiles “auto-approve” your friend requests • Plus video trailers 11

Viral Comedy - Dodge Caliber – Pig and Bear 12

What’s viral? Marketing consumers transport for you. Simple. Why? > It’s unique content or functionality they can’t get elsewhere > Exploits the natural desire to be the first on your block with something cool 13

A user-powered place to play: Fox + X-Men • X-Men: expanding the functionality of the network, empowering users to do things they couldn’t do before they became friends with the X-Men > X-Men MySpace skins > Portable viral movies – add the movie trailer to your page > New functionality – users get 16 “Top friends” instead of a “top 8” if they add the X-men as a > http://myspace.com/xmenthelaststand 14

Fear, Uncertainty, and Doubt • This is about brand-building + loyalty building – NOT direct response. > DM approach is boring for users. • Media and production budgets become messily co-mingled • It’s scary to “open-source” your brand – > to succeed on a social network, you have to allow users to comment on you, to actually control your brand a bit online – this is a scary thing. Anyone can (and will) say anything about you. • Rejection is painful. > Advertisers and marketers are late to the social networking party • The waters move quickly > one misstep and you’ll drown • Horror stories for users of transparency gone wrong / too far • Will people really buy products they see on social networks? • Metrics are pretty soft > Tagworld can do this – will MySpace catch up? 15

The Future / Further Reading • MySpace is just the beginning: > Social networking sites are multiplying rapidly > Users flit between sites > Filling out profiles again and again is a drag > User-owned, merged profiles that can be plugged into any new site will emerge • For more on social networks and emerging media, check out our blog 16

Thank you! Questions? 17

Advising on the Purchase of Myspace (ouch!) - briefing for financial analysts advising Fox Interactive / NewsCorp

by John Manoogian III (jm3)

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