MeetMe: Why The Future of Social Media Lies in Mobile Advertising

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At ease in his corporate headquarters in idyllic New Hope, PA, with the Delaware River flowing evenly a few blocks beyond his office window, Nick Hermansader, VP of Ad Ops at MeetMe, might seem worlds apart from the lightning-round realities of the mobile social media space.

Yet there he is, right on the front lines, as he describes the brand positioning of his company, a social media platform with five million active monthly users; one that’s known industry-wide for its bold moves in both mobile advertising as well as in acquisition.
“Some seem to have the impression we’re a dating app,” says Hermansader, “but really that’s just one among many of our functions. The whole point of MeetMe is we’re a social discovery app where people can go to make friends, find a tennis partner, meet their fellow Pokemon Go players… and yes, absolutely, discover people in their area they want to date.”

Social media has come a long way since 2003 – 2006, when peer-to-peer networks like MySpace, LinkedIn, Facebook and Twitter first gained traction with their users and investors. In those bygone days of first-generation social media, users tended to flock to platforms that simply allowed them to socialize and network online with their “offline” friends and colleagues.

Times – and tastes – have changed. First-generation platforms like Facebook and LinkedIn continue to dominate the numbers game (Facebook boasts 1.65+ billion active monthly users). But today’s social media audiences aren’t necessarily looking to join social networks simply because “everyone else” is on them.

With app stores now stuffed with scores of social media platforms, second-generation social media users tend to join particular networks with specific goals in mind. They’re looking for dates, discounts and fellow enthusiasts. They seek out digital communities that share their own ideals, orientations, politics, lifestyles and passions. Moreover, they’re looking for a user experience that lets them pursue their social networking goals easily – with the simple tap of a key, or swipe of an app.

The result is that newer social media platforms tend to cater to highly individuated tastes, regions and lifestyles.  People flock to Tinder in search of others who are looking for true love or casual hookups. YY Live, the wildly popular Chinese social video platform, provides a unique offering for China’s karaoke-obsessed culture, letting up to 100,000 users tune in and watch someone performing livestream karaoke. There’s even a worldwide social platform for industrial-music-loving Goths called VampireFreaks, whose “shadowy” membership ranks currently in the millions.

 

From a user standpoint, social media might seem a free-for-all bonanza. But for the actual companies building apps and websites designed to attract these selective social media consumers, it can be a tricky business. An inevitable question arises: how does one earn sizable revenue, while still catering to a limited user base?

MeetMe is a prime example of a mobile social app that’s been able to strike gold within a niche market. But Hermansader emphasizes that MeetMe is a fortunate exception, and far from the industry norm.

“There are thousands upon thousands of different social media websites and apps out there,” says Hermansader. “The challenge isn’t so much finding a niche; it’s finding a niche that’s big enough to sustain your business over the long run.”

How has MeetMe met the challenge of monetizing its business, while still cultivating an individuated user base? In a word: advertising.

While in-app purchases and a premium subscription version of the app also help with monetization, the majority (around 80 – 85 percent) of MeetMe’s revenue comes from programmatic advertising. And since 90 percent of MeetMe’s users access the social network via their mobile app, the vast majority of those profits come from mobile advertising.

Figuring out the best possible ways to maximize ad revenue using the MeetMe app is Hermansader’s field of expertise – as well as something that keeps him awake at night, he admits with a laugh.

“Basically, we’ve embraced the idea of programmatic ad serving – and the ideal of serving ads that appeal directly to our users’ interests,” he explains.

MeetMe’s use of mobile advertising is sophisticated. It includes a number of different ad units such as 320×50 and full-screen interstitials. And with its growing, year-on- year popularity, Hermansander and the MeetMe team are placing big bets on native in-app advertising, which consistently lets advertisers achieve high impressions – and mobile publishers earn high yield.

MeetMe started the integration of native ad units towards the end of 2015, but the demand hasn’t quite caught up with the technology. While the CPMs are high, says Hermansader, the same can’t be said for the demand – at least not yet.
But MeetMe came prepared. As part of their advertising strategy, the company gave itself the ability to control weighting of native ads versus regular display ads. As a result, they’ve been able to roll out their native ad units slowly.

The current strategy, according to Hermansader, is for his Ad Ops team to run a small amount of native ads, keeping an eye on how well they perform. All the same, Hermansader anticipates that native will become one of MeetMe’s largest sources of ad revenue in the near future.

But native is only the beginning, as far as Hermansader is concerned.

“There are some other new things we see on our radar,” he says. “We’re looking into mastering private marketplaces and forging longstanding relationships with certain brands and agencies that appeal widely to our audience demographics.”

He also concedes that making fuller use of the company’s user data will be of vital-most importance to its continuing success. “As a mobile publisher, there’s never any shortage of data – but translating all of that [data] into ad revenue is a story for another interview,” laughs Hermansader.

For a social media site that sees average daily traffic of 30 million messages on its platform, that story seems more than promising.

 

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