I came across a post today on the blog Content Management Connection titled “The Collapse of Social Media?” It makes some good points relative to the decreasing value of an advertising business model for the social media industry. Ultimately, Jay points to the need for a new utility for social media through innovation away from an advertising business model. With social media I believe that shift will be in the form of finding ways to enhance close quality interactions and away from quantity metrics.

Jay had this to say about the growth of social media in his blog:

“It is simple, most of the people on Twitter don’t use Twitter regularly. Twitter growth is slowing down. Only 30% of the members actually do it. Advertising on Twitter gets the same dismal response rates as everywhere else, 3% or less.

While the stats show usage growth of other sites like Facebook and Linkedin the corresponding click through rates on ads placed on these sites is static or decreasing. Most of the people using search don’t click on the ads. Advertising has been the foundation holding up all things social and sooner or later it will collapse.”

This point is well taken and the ultimate point of the article was not that social media is going away, but rather that it will have to evolve in its business model away from a total reliance on advertising, instead adding “utility through innovations.”

As I mentioned above, this utility is going to come from finding a way to enhance close connections with fewer people and will ignore meaningless metrics relative to connections without any value.

I make a point of unfriending anyone who tweets about getting more followers. These people clearly miss the point. The value of Twitter is being able to connect, communicate and regularly interact with smaller groups of people with special interests. The value of social media lies in these interactions and the ability to build relationships around them. This includes real world interactions at events and gatherings that only serve to strengthen online relationships.

If you are a startup out there looking to capitalize on the social media movement, you would be well advised to focus on quality over quantity as a core to your business model. Don’t fall into the quantity trap.