People invent new methods of marketing daily.
Most of them are never heard of.
A few are clever enough, well-enough financed, and useful enough to get big.
Many of those eventually peak and die.
Why?
A big part of the growth is buzz, and a big part of that is hype, and people climbing on the bandwagon.
When I say “marketing methods”, by the way, I don’t just mean “skywriting” or putting ads on the floor at the grocery. Facebook is basically a marketing method. It’s a free service so that Facebook can then sell advertising delivered to its members.
As word spreads, and whatever it is becomes more popular, people tell each other, it becomes the thing to do, good salesman jump on board, people invest money in it, and so on.
But the ultimate success of any of these depends on three things:
1. That it is useful enough to its consumers.
2. That it has a moneymaking business model.
3. That something better doesn’t come along and knock it off its pedestal.
We’ve seen very visible examples of all three of these in the world of the Internet. Some of them are going on right now. Facebook appears to have peaked. A lot of people joined because everyone else did. It was only a novelty to them.
Groupon is very useful to consumers and the businesses that advertise, but they are losing hundreds of millions of dollars. I don’t think they have a plan to become profitable, especially since it is too easy to set up your own Daily Deals, for a particular industry or niche.
Facebook so took over the territory MySpace once owned, that MySpace has become a joke.
Not that many companies manage to weather the first two of these hazards, and they will always be vulnerable to the third.