It is now commonly accepted that social media and in particular social networking sites such as Facebook and other popular sites in the social media ecosystem can generate significant user traffic and engagement. Popular YouTube videos can draw millions of hits in a single day and popular Facebook Pages can draw large comment volumes for each content nugget they post. It is not surprising that most major corporations are ramping up activity in evaluating and trying out the various social networking options.

Given that events that appear on a user’s wall typically have a longevity of a few days, coupled with the fact that recent estimates put average daily usage at up to 4.5 hours per day and between 25-30% of online internet time on Facebook (depending on country), it is no surprise that this phenomenon is of interest and presents a significant opportunity to companies, marketers and advertisers.

The Facebook platform is also deceptively easy to develop for. Almost overnight, every single web development house with a little Javascript / XML and Flash experience has hung up a shingle claiming they can build Facebook apps.

Unfortunately, the ease of building entertainment-oriented applications (e.g., flash-based games and surveys and virtual gifting campaigns) and the popularity of these applications when properly done, is leading many companies who are new to the social media game to witness temporary spikes in user interest and to think that they have cracked the code in social networking.

The questions remain:

1. Can these entertainment-oriented applications sustain user engagement?
2. What is the most cost-effective manner to leverage these applications over time?

Can these entertainment-oriented applications sustain user engagement?

As user profiles get increasing cluttered with multiple brands and companies vying for their attention, social networking is already starting to show similar tendencies as more established media such as web, TV and print. Explosive growth in sites such as Facebook and the geometric mesh of interconnections where items / events are cross-posted to “Friends” profiles is only exacerbating this clutter.

There is no doubt that entertainment-oriented applications can assist a company to build their presence on their chose social networking sites, and a sequence of these overt time can help to maintain user engagement, but as clutter increases with more and more companies jumping on the social networking band wagon, it is going to become increasingly difficult to achieve cut through. So unfortunately, it is likely that the answer to the question is NO.

However, knowing that, savvy companies with long-term planning horizons are starting to consider what else to offer though social networking which will add long-term value to their customers and keep them coming back.

The increasing time that users are spending online within the chosen social networking sites also has significant implications on the relative importance of corporate websites as opposed to corporate pages in the social networking sites. This makes getting their social networking strategy and the channel mix right even more critical over time.

Just as internet banking transformed the banking value chain, or internet flight booking transformed the travel industry value chain, social networking is also going to transform how these now relatively mature corporate internet presences will need to operate to maintain user traffic.

If people are spending more and more time on Facebook, and coupled with user preference for a single, “home” portal to avoid having to remember a dozen or so passwords to your cell phone service providers website, your bank, your frequent flyer site, your various household utility sites, your superannuation / 401k sites, and so forth, it is a no brainer that in the not too distant future, it makes sense that companies will need to shift (at least in part) their transactional functionality to the social networking domain. Why would you want to log in to your cell phone service provider website to activate a SIM card or to top-up your prepaid credit with a different set of login credentials, if you were on Facebook anyway, and the functionality was available through a branded service-provider application within your Facebook profile, with the same single log-in. Why log into eBay if eBay is embedded into Facebook, and so forth.

Providing this value added transactions in the social networking domain, will actually enhance customer utility and convenience and hence, induce them to repeatedly visit a company’s page.

As such, customers will seek out the company’s pages rather than company having to push their pages to their customers, and customers will regularly return without prompting as they need to continue to transact with the given company, e.g., to regularly top-up their prepaid cell phone credit. Of course, once these utility / transactional applications generate a user traffic flow to the page, there are the usual advertising / marketing opportunities.

The bad news for many companies is that social networking is about to induce a whole new round of capital expenditure to migrate transactional functionality to the social networking domain and there will be organisational challenges as channel-cannibalisation issues are addressed – however, whether they want to or not, the social networking domain is where the users are going. Companies have no choice but to adapt to this changing customer behaviour.

What is the most cost-effective manner to leverage these applications over time?

In the interest of getting campaigns and associated applications launched, and to minimise the costs of individual campaigns, the majority of applications are being developed as single-use / single-purpose.

However, given the short shelf-life of most entertainment-based applications, if the intent of a company’s foray into social networking is to generate sustained engagement, the company is going to need to develop a pipeline of campaigns and applications to keep users coming back.

The issue is that taking short cuts on any individual application, while likely rational in isolation, is actually going to cost the given company much more in the long term.

If the intent is to generate a series of attractive application-based campaigns over time, then creating single-use applications is simply not consistent with good software development practice.

The global and local software development industries have existed for as long as computers have existed. The industry has defined processes, tools and techniques borne of decades of commercial experience surrounding what works and what does not. These processes and techniques are well documented, embedded into student training curricula and supports a global industry of standards compliance and training accreditation.

It is unclear why in the Web 2.0 world, and in particular, social networking world, that all these best practices are frequently if almost always tossed out the window. Of course, there are arguments about putting more emphasis on look and feel of a given entertainment-based application (the “creative” side) and not to worry so much about how the IT in the back-end actually works as the end users don’t care.  It can also be argued that if the application is relatively inexpensive and so you can simply ignore good software development processes to keep it simple.

Could it be, however, it is an issue of not knowing what you don’t know. As previously mentioned, many web development firms have expanded into application development. Due to the concerted efforts of the major social networking sites to make it very easy to develop basic applications, the proliferation of developers has been significant – but so is therefore the noise in the marketplace. However, just like in any trade, there is a significant difference between experienced and inexperienced developers. Both can turn out an application that most likely fulfils the basic brief, but only more experienced developers consider the operational aspects of an application like maintainability, robustness, scalablity and component reusability.

Properly done, a company can accumulate a social networking toolkit (consider them building blocks) of application components which they can reuse and reassemble in a number of ways to create that pipeline of applications to maintain user engagement – this saves time and more importantly, money for subsequent campaigns so taking short cuts and not worrying about this “IT stuff” is simply a false economy.

In the software world, the equivalent buzzword is SOA or Service Oriented Architecture – essentially, the building of complex applications (e.g., games or virtual gifting campaigns or surveys) out of simpler building blocks. To lay people, this is known as “common sense”.

As such, when auditioning potential developers to assist in a campaign, attention must be paid to whether they are essentially creative artists extending into basic application development or are they true application developers. Would you let an interior designer carry out the structural engineering work in a house build? Would the interior designer even know what question to ask the structural engineer? Maybe..probably not.

If a company intends to take an extended swim in the social networking pool rather than dipping a toe momentarily, the company must really take into consideration these concepts of reusability and maintainability. Resuabillity reduces long-term costs to an organisation and reduces time-to-market and project risk, while maintainability allows the application to be up and operational 24×7.

Facebook, while highly successful in user acquisition, and also provides arguably the best developer support of any social networking platform, the platform is still very young and is constantly evolving.

For example, one issue facing companies who have long-duration applications / campaigns is that Facebook can and regularly makes changes to their Application Programmer Interfaces (APIs). Facebook recently (mid year 09) changed the way the APIs worked for posting on user walls – in part to address certain privacy law / regulation changes in some of the countries Facebook operates. This was communicated reasonably well in the Facebook developer forums, but the vast majority of the world was oblivious to these back-end changes. The problem was that posting on walls is one of the most common Facebook functions that developers use as part of their applications. In a short period of time, a large number of applications that used that functionality stopped working properly and companies had to invest time and money to recode their applications to use the new APIs. If you didn’t know this was going to happen and you didn’t plan for it, you could very well be surprised to wake up one day to find that that application that you invested in and which is still running as an active campaign suddenly stopped working – with all the poor user experience and PR related issues that follow. Unfortunately, Facebook application development is simply not a “fire-and-forget” activity, at least not yet.

Monitoring such changes is easy and is pretty standard practice for reputable development houses that also typically provide application support to their clients. However, given that we have already contended that the majority of applications are in fact single-use and are deployed on a “fire-and-forget manner” (“it is after all just IT right?” mentality), then the short cuts of improper design, lack of modularity / reusability / maintainablity and one of the most common mistakes – lack of proper error handling – will come back and haunt you. Typically, costs of fixing the application and getting it back on line can be equal to or even exceed the original cost of the application – hence the false economy and the risk of using less than enterprise-grade application developers.

Closing Thoughts and back to the Title

So will your organisation be more like the tortoise – methodical and steady building of customer engagement – or more like the hare – prone to rapid spurts of short-lived activity? Will your company take a long-term view towards investment in social networking technology or take apparent short cuts but end up expending far more resources over time?

You can rush out of the starting blocks with flashy (pun intended), and apparently low-cost applications which generate bursts of user engagement. However, if your goal is to generate sustained engagement on a cost-effective basis over time, you should not and cannot afford to cut the corners in the software development and support aspect of the campaign.

Also, while flashy games, surveys and all manner of current successful social networking applications are again relatively quick and successful, long-term sustainability in the social networking space requires creating a reason that users will repeatedly return to your pages without having to continue to invest marketing dollars to get the users there – this requires identifying underlying transactional opportunities with users and making the long-term investments in creating the transactional applications to provide true value-add to these users while providing customer-self-initiated incentives to visit…often.