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Gina Bianchini

Gina Bianchini

Gina Bianchini, CEO and cofounder of Ning, which is headquartered in Palo Alto, thinks Americans are still in the experimental stage with new social media. She is trying to position her fast-growing company, which she co-founded with Netscape founder Marc Andreessen in 2004, as the laboratory of choice.

Bianchini describes Ning as a “social platform that allows users to both create and join as many social networks as they wish to follow their interests and their passions.” In essence, it allows people to establish separate Facebook-like networks for each of their interests, so you might have a network of sports buddies, a separate network for film buffs, and a third for raising young children.

Many of these Ning networks are quite small — she describes them as “Neighborhood Watch–type groups” — but others, like an alternative wind power network, serve as a clearinghouse for hundreds of groups working on an issue.

If the issue of timing is everything — and according to Malcolm Gladwell’s Outliers: The Story of Success, it often is — then Ning’s entry point into this space appears to have been almost perfect.

Bianchini and Andreessen have spent five years crafting a company positioned to benefit from one of the fastest-growing business segments on the planet. Many Silicon Valley executives believe that social media, and the emergence of “real-time information,” is a huge game changer for businesses of all types, but especially for the media industry.

Twitter, for example, has become what could be called “the breaking news channel of choice,” where those who break the news are not journalists but simply people in the crowd.

And Facebook has successfully challenged Yahoo and Google to emerge as one of three megasites on the web, according to Compete.com and other metrics agencies.

In this context, Ning seems a perfect solution for those who seek do-it-yourself or business-to-business solutions for pursuing their social media strategy, as opposed to Facebook’s über-platform and Twitter’s chaotic stream of tweets. Bianchini says Ning is growing at an impressive pace:

n  There are now over 1.4 million Ning networks about everything from the rapper 50 Cent to the Twilight books to the Pickens Plan — the hub for wind energy activists.

n  Over 4,000 new networks are being created every day.

n  Registered users number over 30 million, “and we are adding another million every 13 days.”

n  The site receives about 3-billion-page views on 215,000 Ning networks per month.

This last number, the active networks, is running at about 15 percent of all Ning networks created, which leads to a rather obvious question about the site’s conversion rate.

“We don’t look at it as whether they are active or inactive, actually,” Bianchini explained. “What we ask is, ‘Are we driving experimentation, and is Ning easy to use?’”

She said the most critical metric is the escalating rate of new networks created, which indicates Ning is an engine driving experimentation in social media.

As a point of comparison, it has been reported that the vast majority of Twitter accounts lapse into inactivity very quickly, with only a small majority, perhaps 10 percent, generating 90 percent of all activity on the microblogging service. Despite this low conversion rate, few expect Twitter to be going away any time soon.

One notable aspect of Ning’s growth is the proliferation of networks being set up by users of the other major social media sites. As of mid-August 2009, there were more than 360 Ning networks devoted to Twitter users and over 1,120 networks for Facebook users.

“One part of all this that I find incredibly exciting from a market perspective is that technology and social experiences and social media can now work together better than with any previous class of software,” Bianchini said. “Everyone can, in fact, now get along.”

She added: “That is to me a very different dynamic from what the web was even five years ago. It’s the most exciting thing in the online world today. You can actually give people the ability to extend their Facebook experience and all of their other interests and passions across public or private networks on Ning.”

A small number of Ning networks (around 12,000) pay for “premium services,” which allow those groups to remove advertising and Ning promotional links and use their own domain name and the like. This proves to be an attractive option for some business-to-business networks, among other user groups.

While Bianchini wouldn’t discuss the actual dollars generated from this part of the business, she did say that the subscription revenue was of secondary importance to advertising, according to Ning’s business model.

To date, the company has been using Google AdSense to insert advertising across its networks, but she indicated that other partnerships might be in the works: “Stay tuned on that.”

One key aspect of the future success of Ning’s ad model will be how the company finds ways to exploit its database of the “interests and passions” its users are pursuing on their networks. Users tag all of their content, and then, Bianchini says, “we do a fair amount of work at the network level” to validate and organize all of that information.

The resulting database of what people actually care about in “real time” (that is, when they are sharing it with colleagues and friends) is potentially a valuable tool for attracting advertisers to Ning.

For advertisers, such data indicates Ning might deliver more customer leads than traditional media. Would it be fair to describe this as the essence of Ning’s business model going forward?

“I’d say you’ve got that exactly right.” l

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Also on Stanford Knowledgebase:

  1. QOTD: Online Life Morphing with Real Life
  2. QOTD: Social Networking According to the Talmud
  3. The World Is A-twitter

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