LaunchBox Blog

Tim O'Shaughnessy, co-founder of Hungry Machine, led a discussion with the LaunchBox08 startups detailing strategies for developing social network applications. Tim gave insider tips to the group while chronicling the story behind his successful "Visual Bookshelf" Facebook application.

Choose a social space that you believe in. When choosing a social platform for your application, it is important to remember what the network is providing. For example, Facebook might have the most valuable base of users from a domestic standpoint, but it is probably also the most saturated with applications. Conversely, the Orkut network only consists of around 10% English-speaking users, which could present a challenge for US-based advertising revenue. From a user-acquisition standpoint, Tim notes that a network like Friendster (which is not a part of OpenSocial) might be valuable because fewer developers have gravitated to it, and thus there is less competition.

Pay attention to the important metrics. Daily active users, a common form of measurement, can sometimes be less reliable than conventional wisdom holds. The true metrics that make a business run will vary from business to business, and Tim finds that monthly uniques and time spent on each visit are the most helpful to him. Tim also recommends that developers spend a great deal of time conducting "A/B testing" and have at least one variable being measured at any given point in time.

Forecasting the future. Tim predicts that a great area of growth in Facebook applications will come from the onset of virtual goods, particularly when Facebook launches its "card-on-file" feature that will enable users to make purchases from their credit cards with one click. This will create a particularly compelling opportunity for developers to leverage the convenience of this new feature to drive sales within Facebook.