I will invest in a lot of different industries. There is wisdom in a balanced portfolio that allows for the ebbs and flows of a complex marketplace. However, I have not rushed to invest in social media such as Facebook , even though it represents a hot industry that often captures the attention of the market. Perhaps I should start buying up chunks of social media stock. However, I am still going to wait and see where this goes.
Everyone has a social media profile these days. Well, not exactly everyone. Most people? Many people? Let's just say that older folks are on social media, which probably means that the young people will start abandoning it. All I know is that there is ongoing talk about social media fatigue . This tells me that society will do what society often does. Society goes crazy for a particular trend, overwhelms it with attention, and then moves on to something else. I don't want to be left holding 100 shares of stock in yesterday's big thing that is no longer cool.
What is the product?
What is social media selling? Information? Data? Just a gathering place of the people? I understand why some companies are struggling to determine their profit model. As a general rule I do not click on web ads. Granted, many people do and I also know that there is a subtlety to advertising. When I see an image many times, I am probably more prone to think about that brand in the future when I actually consider a purchase. Therefore, web ads are always going to have a significant return on the investment. However, they are still a challenge to track. I imagine there is an impact on me as a consumer, but that impact is probably subtle.
I never had a MySpace account. Maybe I will get one someday, but I have no plans right now. Remember when MySpace was all the rage? Neither do I. Actually, that isn't true. I do remember the hype, but I also remember when it went away. MySpace is still around and may rise again, but other companies passed it by long ago. There are obviously some social media companies that are much more established than MySpace ever was at the peak of their popularity. However, it reminds me that companies can glow white-hot and then quickly fade away.
Perhaps I am missing out on an opportunity to get in on the ground floor of tomorrow's big-time companies. However, I am still hesitant to jump on-board this trend.
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