November 6, 2008

• How Xanga Nerfed Itself

  I have wanted to write a follow up post to “Saving Xanga” and here is the post.  I want to mention once again that anything in this post is not designed to be critical of anyone on the xanga team.   Instead it is designed to give one person’s opinion on what xanga can do to save itself.

  Here we go:

  I was talking to a member of the xanga team about two years ago about the old featured content system and how xanga would be moving away from that system.  Xanga would no longer be driving traffic to bloggers that had the highest traffic.  Instead xanga would be using the new system called “Boost.”  Boost would help identify better content on xanga.

  At the time of that discussion on instant messenger, the xanga team member introduced me to a term called “nerfing.”  Nerfing is a way to bring about change on the internet.  The change takes place over time and therefore is less likely to be noticed.  It makes the change appear painless like catching a nerf football.

  The xanga team member told me that xanga would be nerfing the old featured content system.  They would be driving less traffic to the link.  This would cause them to be able to do away with it and the people on the link would be less influential so it wouldn’t matter when they complained about xanga doing away with the system.

  The member of the xanga team appeared pretty proud of the clever approach.  Xanga could nerf some of the most popular sites and no one would even know it.  At the time I was reading the message, I was thinking to myself, “What you are really doing is nerfing xanga.” 

  Why did I think xanga was nerfing itself?  Because by not feeding traffic to its most popular sites, xanga was killing part of the sources of its traffic.  Remember all the popular sites that used to be on featured content?  I know you don’t.  They died.  Those sites lost any support they had from xanga. 

  Let me give you an example.  Anyone remember Novelle361?

  She was a professional writer.  She was pretty popular on xanga back in the day.  Does anyone remember when she left?  She left January 1, 2007.  This was a short time after xanga began to nerf featured content.

  Now Novelle361 could probably give us reasons why she left xanga.  But I noticed that several of those sites dropped off shortly after xanga started to nerf featured content.

  Why?

  Some sites had a certain amount of time to write.  They then had xanga sending them traffic.  Once xanga started to nerf itself, those sites saw a dramatic drop in traffic.  And several of them left quickly all at the same time.  It is only natural that you would go where the traffic is.  There was no reason for some of the sites to stay.  I don’t think most of those sites even realized they were being nerfed.  But once they got to a certain level, it was hard to continue if they began to decline.

  I think if you went back and asked people like Novelle and so many others why they left, they would give you multiple reasons.  But the reality is that most of them saw a decline in traffic.

  How does xanga nerf something?  Well, it is pretty simple.  Xanga has a lot of control over what gets traffic.  What is xanga’s priority right now?  Anyone?  Yes, datingish, revelife and momaroo and a few other test sites.  Xanga constantly puts those sites at the top of their front page.  They advertise them in other places too.

  How did xanga nerf the old featured content?  They actually moved the links to the old featured content down the page a little.  I actually know this because I was told.  It was intentional.  Then boost was put on top of it.  And xanga then added the boost link to everyone’s private page.

  Why would xanga drive traffic to datingish, revelife and momaroo?  Because those sites have ads on them that pay xanga.  Those ads can be a little more focused and can deliver more money.

  But it is something bigger than that.  I want you to go look at all of the top blogs really quick and most of the other sites that xanga advertises.  What do you notice?  You will notice that most of them are premium.  Why is this a problem?  Because xanga doesn’t make any money off premium sites.  They do make money indirectly because those sites have other sites coming to them.  But the top blogs link is on a lower part of the front page for a reason.  Most of those sites are premium.

  Xanga has painted itself into a corner.  That corner is called premium.  It is killing xanga.  What happens when a site gets popular on xanga?  The person gets premium.  Xanga stops making money off that site.  That is why xanga doesn’t really want to drive traffic to its most popular sites.

  Lets take my site for example.  I added the google ads that xanga put on here.  How much money do those ads pay?  I get about $5 a day.  Now let me do a little math for you.  $5 a day at 365 days a year equals $1825.  Now multiply that times the last 4 years.  That is $7300.

  I am one site.  Xanga can make $100 off free premium for life.  What do they lose?  $7300.

  Now some of you will point out that my site is pretty big.  That is true.  But you take all of the premium sites together and they make my site look like a dwarf.  So any time a site gets large, the owner gets premium and xanga gets a little money. 

  Does anyone see the problem?

  Xanga has all of these sites now that have the potential to drive traffic and xanga is unable to make a profit from them.

  So now xanga has an idea.  They go and make these targeted sites.  And those sites get ads.  Have any of you been approached by xanga so they can place your post on momaroo, revelife or datingish?  Why wouldn’t they just feature your site?  They were putting it on a site that could make more money.

  Now making money is not evil.  I am simply disagreeing with the approach.  I think xanga would do far better to keep ads on its most popular sites and feed those instead.  Why?  Because the xanga team can only successfully manage one or two sites at a time.

  There is another big problem.  Xanga offered credits.  More sites were able to purchase premium with those credits.  Do you see the problem there?  Yes, the problem is that more sites as they grow will simply buy the premium with credits.

  Xanga is nerfing itself.  Instead of driving traffic in the way that feed bloggers, they have to drive traffic to these sides sites.  They have to go find your post and move them over to a profitable site.

  Is this a winning strategy for xanga?  No.

  Go to compete.com.  You will see that xanga continues to drop traffic at an alarming rate.  Remember when I pointed out earlier this year that xanga was mentioned as one of the fastest declining sites last year?  The decline is still in progress.

  I am betting that xanga will drop in average views by a million a month by April of next year.  Anyone want to bet a 1000 mini on it?

  Now we are at the stage where some will say, “If you don’t like it, leave xanga,” “What we need is a little more xangappreciation,”  “I am tired of all the posts that are critical of xanga.”

  I hope once again that people realize the real problem if xanga declines at 40% a year for the next few years.  The xanga team as you know it will not exist.  This is hardly a post that is negative concerning the xanga team.  More than one person on the xanga team has expressed to me a “backup plan” if xanga continues to decline.  Instead, this is a wakeup call.

  Solution:

  I think the best solution is for those of us who are premium users to allow advertisement space back on our sites that allows xanga the profit.  It will allow xanga to make money immediately.  But it will also allow xanga to start feeding traffic to bloggers and begin to grow again.

  Would xanga ever ask you to do it?  No.  But I think the writing is on the wall. 

  Would you be willing to allow xanga to put ads back on your site even if you paid for premium?

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  • 7:35 pm
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