A number of articles have already speculated that the once-upon-a-time-most-popular social networking site is on its death bed, but the case study of MySpace’s ultimate failure provides some real food for thought.
MySpace is a classic example of misaligned strategy directly leading to improper execution. There’s no reason MySpace couldn’t have, shouldn’t have been the preeminent social networking Web app—they were first to market, had a sizable user base (estimates range from anywhere from 100-160 million total accounts), a premium advertising deal with Google (reported at $900 million over 3 years) . . . . yet less than five years from its peak in 2006, the company is on its way to irrelevance.
The problems MySpace faced along its journey are well documented: security and malware problems infesting its pages, poor interface designs, few apps and little useful content, the general “teenage” vibe and inability to create a community for people over age 25 . . .
Who knows if MySpace saw Apple’s Ping on the horizon—but the endgame of this round of mobile device wars (iPad, iPhone 4) should have at least been a clue. Why wouldn’t the 8-billion-pound gorilla with the world’s most popular digital music distribution platform want to integrate the two together?
Seamless integration of Web, iTunes, iPod, iPad, iPhone, with a social networking site for musicians, distributors, and fans?
If MySpace wasn’t quite dead yet, they just got whacked over the head while being carried to the burial cart.
MySpace’s downfall is clarion call about the need of carefully aligning sales, marketing, and production.
It’s evidence of the value of real customer relationship management, of listening to customer feedback, and changing directions to give them what they want.
But more than anything, it demonstrates that a company’s identity controls their place in the market—not the other way around.