Original｜Odaily Planet Daily (@OdailyChina)
Author: Wenser (@wenser2010)
Whether the SocialFi track can get rid of the "growth dilemma" may need to rely on the "Fi" link's hematopoietic ability to be sufficiently verified. In the previous article (SocialFi's "narrative failure", does encrypted social networking still have a future?), we briefly analyzed the main problems of the current SocialFi track projects. In order to solve these problems, combined with the main characteristics and advantages of encrypted projects, the SocialFi project may also need to partially learn from the development ideas of traditional mobile Internet blockbuster applications.
In this article, Odaily Planet Daily will break down and explain the "Fi" aspects of traditional social products and the SocialFi project, and analyze the development history of "ByteDance's popular app Lemon8", which has performed well recently and is known as the "overseas version of Xiaohongshu", for reference by players in the SocialFi track.
The "Fi" chain of traditional social products: from free products to paid subscriptions to value-added services
In addition to the account management model and login method that are very different from SocialFi products, the operation of the "Fi" chain involving monetary payment in traditional social products can be said to be seamless, so precise that each step of the operation has its own unique design purpose and functional considerations. The following is a step-by-step disassembly of the "Fi" chain of traditional social products:
Paid products/subscription-based use-niche social applications
In traditional social application products, the "pay wall" is the first link to generate cash flow.
Generally speaking, for some niche social applications, due to the limited user scale, the paid entry threshold or subscription usage cost has become the main boundary for distinguishing real users from fake accounts.
This type of social application usually serves a specific group of people or interest groups, such as music social networking, sexual minority social networking, entertainment social networking, etc.
Free products + value-added services-game social applications
For most social application products, "free products + value-added services" is the more common "first choice for generating revenue".
For most social applications, internal testing + free products are often the common settings for the initial cold start; and after accumulating a certain number of users, developers often increase application revenue through in-app value-added services - such as more matches, more diverse social decorations, more advanced crowd targeting, and props with more "social attributes".
This type of social application usually has certain gaming attributes, and increases user choice rights and user stickiness through "swipe left and right" or "favorability mechanism".
Free products + points incentives-crowdsourcing social applications
In addition to value-added services, there is also a type of social products that choose to increase the frequency of interaction between users through "points incentives" and earn profits through cooperation with B-side enterprises and merchants.
To some extent, the current crowdsourcing rating applications can also be regarded as a type of social product. Its main operating model is that users obtain corresponding points incentives by checking in at a certain location or performing other operations. In the subsequent consumption process, the points incentives can be used as discounts on physical consumption or peripheral redemption vouchers.
This type of social application usually relies heavily on behavioral interactions in offline spaces, and achieves social purposes and marketing through the mechanism of "crowdsourcing evaluation behavior."
Free product + advertising medium-entertainment social application
For many social application products, entertainment content is an important component because entertainment often means attention resources, which is exactly what advertising media needs.
Many so-called big Vs, KOLs, and internet celebrities, in a broad sense, are entertainment bloggers; and through advertising, individuals and social application products can obtain corresponding rewards.
This type of social application is usually more comprehensive. After a certain period of development, the user scale tends to grow rapidly, thus laying a solid foundation for "monetization of attention".
Free products + e-commerce promotion-consumer social application
As the saying goes: "The end of all commercial products is e-commerce, and the end of e-commerce is live streaming."
For many consumer social applications, e-commerce sales is also the most efficient, shortest-link, highest-profit, and most stable revenue-generating model. The platform can charge corresponding fees from multiple links such as advertising marketing, commodity trading, traffic promotion, and platform review, which can be said to be truly "killing two birds with one stone."
This type of social application is usually closely connected with the supply chain and has its own group of "loyal consumers". Its social attributes are often reflected in shopping reviews, shopping experiences and other aspects.
SocialFi's breakthrough: from marginal to mainstream, from niche to mainstream
Looking back at the phenomenal social applications of the past, Twitter, Facebook, Instagram, WeChat, Tik Tok, etc., they have all gone through a process of "from niche to mainstream, from marginal to mainstream", and this is also the inevitable and necessary challenge currently faced by SocialFi products.
The key point is that the starting point of the current SocialFi project often overemphasizes "Fi" and ignores "Social" - when the ultimate goal of a project is not to serve the real social interaction and establishment of social relationships between people and the sedimentation of social relationships, but to achieve rapid "social monetization", "social relationship monetary quantification", and "social graph commission airdrops", then such a product is actually a "financial tool" and has nothing to do with social.
Specifically, if SocialFi products and projects want to see the future, they may need to make changes and attempts in the following aspects:
Anchoring the origin crowd: encrypted crowd or niche group?
For all social products, including the SocialFi app, people are the core and the only source of value.
Therefore, the first question that the SocialFi project needs to answer is: which group of people does the product want to serve the most? Is it the crypto crowd, or other niche groups?
As we mentioned in the previous article (SocialFi's "narrative failure", does encrypted social networking still have a future?), if you choose "everyone" as your target group, it is equivalent to not thinking clearly about who your "target group" is. This is a "strategic issue" rather than a simple tactical execution issue.
If it is the crypto crowd, then the content that the crypto crowd needs to communicate and discuss is the crypto market; if it starts from other niche groups, such as Facebook gradually becoming popular among Harvard alumni, and Tik Tok gradually expanding from all kinds of artists, dancers, and niche enthusiasts who love to play, dare to play, and know how to play, then you need to find these people and then tell them - "Here is a product suitable for you, do you want to try it?"
Give users a reason they can’t refuse: money or something else?
After determining the position of the project and product, the question that the SocialFi project may need to think about is: Different from traditional social applications, why do users come to us for social activities? Can we give them an "irresistible reason to use"?
If the SocialFi application was able to attract some people in the past through gimmicks and "pie-in-the-sky" such as "token airdrops", "user decisions", and "niche interests", now that cryptocurrency liquidity is becoming increasingly tight and the wealth-creating effect is becoming increasingly weak, using an application product to get an "airdrop check" is far less than playing with Meme coins and engaging in intense PVP.
Therefore, in addition to monetary incentives, the SocialFi project also needs to attract users to use, join, and spread in a fission-like manner through other aspects: Is it because of some interesting content? Or because of fresh information? Or is it because of strange emerging trends and unique social gameplay?
This is one of the reasons why popular social apps including Lemon8 initially set their sights on internet celebrities who already have a certain degree of fame - because they are the creators and producers of content, who can attract fans to follow and enter, and thus generate further diffusion and fission, spreading from one person to more people.
Constructing an in-app role cycle ecosystem: Who will create output VS who will pay for consumption?
Currently, in the SocialFi project, most users are “spam and low-quality content producers” like “product locusts”, but there is a lack of consumers who are willing to pay for “high-quality content and high-quality information”.
Generally speaking, there are three types of relationships in social products: one is between high-level producers and low-level producers; one is between producers and consumers; and one is between low-level producers and the general consumers. High-level producers generally produce content with a high threshold for consumption, which requires low-level producers to "simplify the process". Consumers can choose to consume high-level content or low-level content. In this way, an "internal circulation role ecology" of social product content can be constructed.
Therefore, SocialFi products either need more direct and simple low-level producers to produce more content with a lower threshold for understanding; or they need more excellent high-level producers to produce more content with a higher threshold for understanding, so that low-level producers can carry out "secondary processing" and finally face consumers for their consumption.
Projects with strong financial strength often choose to "invite users at high prices" to attract users and adopt a "high-profile" operation strategy; while projects with limited resources need to "play together" and "understand users" more in order to gain more attention and a larger number of users in the initial cold start-up period.
Summary: SocialFi is still a long way from success, and the “Web3 version of Facebook” has not yet appeared
At present, the SocialFi track has not yet seen any GameFi projects like Axie and STEPN; nor has there been any NFT projects like those that have attracted celebrities from the traditional Web2 fields of culture, sports, and entertainment to join.
The goals of most SocialFi projects are always to "scale smaller and smaller", splitting off a part of the already limited number of active crypto-people, making the real user group even smaller. There is neither a "campus version of social application" like Facebook, nor a "niche enthusiast gathering place" like interest-based applications. It has to be said that the SocialFi track is still a long way from being "successfully verified".
Perhaps what more SocialFi projects need to think about is whether to first build a social application with a Web2 account system, and then add a Web3 wallet login system and corresponding data management methods to take the "SocialFi breakthrough path of Web 2.5."
