I had a Facebook account long before I had a MySpace account.  In fact, I never signed up for a MySpace account; instead, I had been using Imeem, a legal music website, which got merged with MySpace Music and migrated all its users over with it.  As a result, I was one of the few that joined the social network as it was declining in growth and usage.  It’s been interesting to see its attempt at revival as an Internet brand.

It’s gone from social network to “social discovery,” focusing on entertainment content.  I like the rebranding and redesign, which makes it look a lot more creative and fresh.  

MySpace though shouldn’t forget its roots as a way for individuals to express themselves to their friends.  Self-expression is behind Tumblr and its monster growth.  MySpace has been accused of ripping off Pinterest, and I think they should embrace this creative source of inspiration and just buy Pinterest and the team to fully embrace this angle of media self-expression and sharing.  What Tumblr and Pinterest does well that MySpace users could benefit from is aesthetically pleasing design constraints that the enable cool self-expression.

Thinking about all the things MySpace should be doing to not only ensure relevancy in a fast-changing Internet world but to restart growth, I have realized that the big Internet brands as a whole could be doing a few things better than just redesigns.  They should be learning from counterparts whose growth had stalled but has been re-ignited.

Acquiring Innovation: eBay + Paypal

eBay bought Pay in 2002 while eBay was still reporting very strong growth.  It ended up being a prescient move as its marketplace business, its traditional source of revenue, has slowed down.  Paypal now accounts for most of the growth.  Buying complimentary businesses with new, monetizable technology has in many ways been the most relied upon strategy by incumbents with maturing businesses. 

Adding Human Touch: Starbucks

Starbucks made an interesting decision in 2008 when it was facing stalling growth and shutting down a lot of locations.  The New York Times reported that CEO Howard Schultz “lamented the ‘watering down’ of the Starbucks experience, blaming the expediencies of rapid growth for removing ‘much of the romance and theater’ from the ubiquitous stores.”  He decided to retrain the baristas to take back some of the drink making process which added more magic to the production of the drink.  People sometimes need to see the human touch to appreciate the finesse and craftsmanship.  Machines that are black boxes capable of magically producing the drinks at the touch of a button seemed somehow less impressive to customers.

The lesson here is the value of showing the work being done, particularly signaling the care and affection put into a product by people.  Efficiencies and automation are good but they can’t subtract from the magic.  Reminding customers of the people behind the product seems to be yet another way to reverse the decline in brand value.

Investing in New Brands: J. Crew

Another interesting strategy is to incubate your own new brands.  This is very different than launching new products with simply new names.  New brands require just as compelling stories behind them as the original brands do rather than simply stamping on the existing brands to the product line.

J. Crew CEO Mickey Drexler used this strategy as he turned around the apparel company into the behemoth it is in retail today.  He focused on producing what he called “cult brands” like Alden shoes for JCrew.  He says “integrity and craftsmanship is the new no-logo logo of J. Crew” and so supports the J. Crew brand while nurturing new ones.  

Curating and cultivating these new “cult brands” can draw new customers while affirming the fanatical loyalty of the existing base.

Conclusion

Of course, there is no silver bullet for the woes of any company facing stalled growth or decline.  Internet companies in particular seem to have had fewer successful turnarounds, which may be due to the nature of technology as a fast-changing industry.  However, the challenge of reversing the decline isn’t unique to them and they would do well to pay attention to ways other companies have re-ignited their engines for growth.

Google may be risking its reputation with the Nexus One phone.  Reports are showing up indicating customers are directing their support questions to Google now instead of the carriers who typically handle customer service. 

Not many consumers like their customer service experience in general — phone calls can be a frustrating experience and email-only support can leave people feeling helpless.  Customer service nightmares can tarnish a company’s reputation as consumers tell others about their experience.

This is why until now Google has enjoyed enviable brand loyalty and love.  Nobody pays anything for Google Search, Maps, Gmail, etc.  No one can really complain too much when a free service goes down for a few hours a year.  Everyone had been getting tremendous value for no cost and the relationship was perfect.

Now that money is involved, consumers need to be heard.  I’m not sure there are algorithmns that will substitute well for a person on the other end appearing sympathetic to your issue and willing to resolve it. 

It will be interesting to see how Google responds to the growing volume of consumers paying it money and the issues that come with it.  If they can’t handle customer service, expect their $100 Billion brand to decline.