TECH TALK: 2007 Tech Trends: 4. Verticalisation

We have seen the creation of the horizontal winners in search and social networks. Google, MySpace, Facebook are the big players. As they become big, they also have their own challenges. While verticalisation has been talked about for long, it should start happening much more in 2007. Verticalisation helps provide focus and better relevance.

This is what Eric Enge wrote on SearchEngineWatch recently:

Outsell reports that the vertical search market will reach $1 billion in revenue by 2009. And enterprise search technology provider Convera’s recent survey of more than 1,000 professionals found that only 43 percent of business professionals always find what they want from a horizontal search engine after several attempts, and half of those who don’t find what they want will then turn to a vertical search engine to improve their results.

The major search providers have long recognized the importance and benefit of verticalization, with each offering some level of vertical options in its general search. In addition, Google, Microsoft and Yahoo have each developed a vertical search platform to allow developers to build a custom vertical search engine using their technology. Microsoft launched Live Search Macros in March, Yahoo’s Yahoo Search Builder debuted in August, and Google unveiled its Custom Search Engines in October.

There are also two significant startups offering vertical search platforms: Eurekster and Rollyo. In fact, it’s quite likely that the success these two companies have seen encouraged the vertical moves by the big 3 search engines.

In a sense, something similar is happening with social networks. Given peoples interests, it is natural for more targeted networking platforms to get created. MySpace and Facebook have shown the general principles for building successful social networks. The challenge now is to apply it in a narrower context. The appeal: better monetization and greater stickiness. Fred Stutzman offers some insights into making it happen:

A lot of new SNS entrants are niche-oriented. Unfortunately, simply being a niche play isn’t enough to guarantee success. We can look at these niche social networks as the modern equivalent of the bulletin board community. Research any specialty interest around the web, and you’re likely to find a mailing list or forum or poorly designed website that serves the needs of this community. The SNS that wishes to come in and replace this forum or website lacks content, community and search placement. It will be a very tough slog.

Therefore, how do you successfully niche orient a SNS? First, you can find an underserved market, or a market that didn’t really exist previously without the social dimension. One I can think of is, a SNS for places of worship. You also need to seed content – if you want to build a SNS for patients or new parents, for example, ,you need to have more than just community – you need to have great content that incentivizes people to come back. Without the content dimension, a good number of niche social networks will fail.

In a way, verticalisation will bring together search and social networks. Search is about the information thats out there which needs to be found and social networks are about self-expression and making and maintaining connections with people. A successful approach needs to be able to combine both to focus on niche communities. People want to search and stay connected with others like them. Verticalisation helps them do that.

Tomorrow: Video Proliferation

TECH TALK 2007 Tech Trends+T

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.