Delicious for sale?
Yahoo!-owned Delicious will possibly be sold to interested investors, as Yahoo! thinks that Delicious is “not a strategic fit at Yahoo!” One thing for sure, shutting down Delicious is not a path Yahoo! will take.
The social media bubble burst?
In my opinion, that official statement should read, “Delicious is not making money and too resource-intensive for Yahoo! Therefore it should be sold to others, rather than shut it down and make Yahoo! no money at all.”
Nothing wrong with the business divestment decision – it’s just an indication that even the big guys are tightening their budget and very closely monitoring their spending.
Yahoo! is not only the one thinking about letting go social media-related assets. Other big guys do so, too. One prominent and related example of this is the deceased Propeller, another top social bookmarking site, as of October 1, 2010.
Top social bookmarking sites are tumbling one by one. The most probable cause is that they are resource consuming, while only making a little, even not a dime, for the owner.
News / stories / links moderation is a major headache due to the huge number of spams – so does any other sites with user-generated and user-submitted content, such as forums and directories. Moreover, web hosting-related costs can be expensive for high trafficked sites, such as Delicious. One more thing – site maintenance and operations are resource consuming, as such sites are facing attack threats from crackers and hackers.
Making money via social bookmarking sites is, in my opinion, notoriously difficult, although not impossible.
Placing click-based ads, such as Google AdSense returns a very poor income, considering the typically-high social bookmarking site traffic. Impression-based ads? Not much CPM value, I suppose.
Other advertising methods? Who would be interested placing an ad to a high traffic social bookmarking site, which visitors are largely Internet Marketers, webmasters and spammers. Internet marketers and webmasters are long known as ad blind (their eyes and brains are “trained” to ignore ads.) Spammers? They have no other interest than submitting their links as many as they can and care nothing about quality (let alone reading news tips or viewing ads.)
I understand Yahoo! decision because I used to own a couple of small social bookmarking sites. I sold them cheap, simply because it’s difficult to make something out of the sites and it’s a real work cleaning up spams from the sites and thwarting site management problems.
With the pressure of uncertain economic situation, businesses of all sizes are letting go their unproductive assets, in order to keep their productive ones – it’s just logical and common-sense, I suppose.
Maybe, just maybe, this is an opportunity for brave entrepreneurs and investors to grab the undervalued assets? Businesses – in the right hands – can perform differently; this could be the case of Delicious.
Please share what you think about this recent development by commenting on this article.
Ivan Widjaya
On social media bubble burst and online business divesting
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I think that many people are using social bookmarking sites as it can definitely boost their SEO efforts. Sometimes, when you do a search for a certain keyword string, the link to the social bookmarking site where your content was submitted is pulled up in the top 1-3 pages. I wonder what will happen to Delicious once it got sold, like will it change name or something like that?
Garious,
I don’t think it will change name – the domain name worth a lot and it carries great branding. The service is great, but unfortunately, it isn’t making enough money for Yahoo!
Hi, Ivan …
Your article, “The Social Media Bubble Burst: Yahoo! will sell Delicious?”, caught my attention (I’ve bookmarked it) because I use Delicious a lot to find sites people like that aren’t readily visible in the search engines. I would surely be sorry to see Delicious descend to the social-media scrapheap like Propeller.
I do appreciate the enormity of the monetization problem, though. I double-checked Delicious just now, and there’s not a single ad in sight!
Maybe that’s why it’s so peaceful in there!
By contrast, Facebook has recently biggered-up its ads in the right-hand sidebar and smallered-down the font size of your posts in the middle so much that you practically have to get out a magnifying glass to read them. Not only that, images that used to display singly are now scrunched up and indented with your text to the point where it’s not very attractive at all.
I hear through the grapevine that a marketer can get good results with Facebook advertising because it’s so “targeted,” but I’m obliged to say that I find ad targeting that’s based on personal data like age or geo-local region or educational background to be sort of “phoney” … it’s not at all like the ads based on “relevancy” that the search engines offer.
And now it seems that corporations and celebrities and “popular” people on Twitter can buy their way into a position in front of you on your home page. This smacks to me of the old Overture model, where the only entities that got to be at the top were those with “deep pockets”. One of the reasons I like Google’s AdWords so much is it levels the playing field so well. The most “relevant” ad wins!
Interestingly, Google Bookmarks is as ad-less as Delicious. And I don’t see any ads on ClipMarks, either. The only two of the five social sites I’m using right now that do have ads are Facebook and Twitter … and they’re my least favorite of the bunch!
Of all the Google ads, the ones I like best are what I call the “little words” ads … the ones that are just two words and that come in a horizontal string and look a lot like navigation tabs. You have some at the top of your site, and also at the bottom, beneath your picture, like so:
Ads by Google Business Ideas New Business MLM Business Money Blogging
I would have no objection at all to ads of this type being positioned in the vicinity of my bookmarks or clipmarks, especially as they would be relevant to the content at hand.
Is there some reason you know of why social sites like Delicious and ClipMarks don’t avail themselves of this monetization method?
Happy New Year!
Elizabeth
:-)
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Elizabeth,
Great insight!
Regarding ad-less social bookmarking sites (and any other “monetizable” sites) I do have some insights from some of the owners: They want to focus on growing the business, in such a way that it is attractive to the big guys to grab it. FeedBurner has no ad when it was acquired by Google for millions of dollar. On smaller scale, Retweet.com was acquired at 5-figure price tag without a single ad on it.
One point of view I tend to believe is that placing ads on the site would ruin the overall value of the site. The site will no longer hold intangible value, as you can approximate the price tag of the site – for example, a site making $1000/month could be priced at $10,000 to $20,000, depending on the potential of the site. What if Delicious is only making $1000/month? (which is possible as social bookmarking sites tend to be difficult to be monetized with PPC ads, like Google AdSense.) With no ad, Delicious could worth the world to investors.
And yes, no-ad sites has their own appeal :)
Thanks and happy New Year!