SocialMedia is a new kind of widget ad network
Seth Goldstein and David Henderson have teamed up with one of the leading Facebook application developers and launched SocialMedia: part widget developer, part widget hosting provider/ad network. Along with Lookery, the company is one of the first providers of monetization services for Facebook application developers — filling some of the vital Facebook Platform infrastructure gaps.
Goldstein and Henderson, internet advertising veterans (Goldstein founded Site Specific, one of the first internet ad agencies, in 1995 and Henderson was DoubleClick’s very first VP of Sales) who worked together more recently Root Markets, joined with David Gentzel, developer of the popular Trakzor application (widely adopted on MySpace and one of the earliest Facebook applications to achieve significant distribution), and Sourabh Niyogi, developer of Appsaholic, to reincarnate the former AttentionSoft as SocialMedia. The company now has teams in the US and India.
After Trakzor, which has 3,750,000 users on MySpace and 800,000 on Facebook, Gentzel and SocialMedia have released FoodFight, which has distribution of 1,750,000, and Happy Hour, which with 900,000 users in its first week has become one of the fastest growing apps on Facebook so far. Altogether, the SocialMedia network claims over 8 million app and widget installations across Facebook and MySpace.
The goal of SocialMedia, according to Henderson and Goldstein, is to develop a network of applications on multiple platforms. However, the company is also making an effort to recruit popular application creators in what to my knowledge is one of the most full-service approaches to application monetization yet. They will bring your app in house onto their servers (if you want), sell your ad inventory to top advertisers and agencies, and help you bake sponsored features into your application. The price? A hefty 50% commission, but hey, better than nothing if you’re a lone developer without cash to spend on servers.
Henderson is optimistic about the new opportunities social networks offer to advertisers. “Social networks offer new and better ways to market. Now, you can now integrate into social constructs and ride on friends’ recommendations rather than trying to market 1-to-1,” he told me recently.
As for the caution that some have recently expressed toward the potential of advertising on social networks? “Some folks are talking about Facebook like it’s ‘only good for customer acquisition,’ as if that’s no small feat,” Henderson said. “Without customer acquisition, you don’t have a business.”