Netvibes is one of Europe's biggest social networks. Freddy Mini, its CEO, told me, "Netvibes was founded in September 2005 by Tariq Krim as a way for people to take control of their daily digital lives. The problem he was trying to solve was 'How can I have everything that matters to me on the Internet -- such as my RSS feeds, the weather, my social networking, competitive sports, my start page -- all in one place in a digital dashboard?' This idea evolved into personalized pages for individuals and personalized pages for brands and publishers."
And this idea has turned into a very popular social network. According Vincent Chang, Netvibes' spokesperson, "Netvibes now has millions of users in more than 100 countries and 80 languages. Netvibes also has the Web's largest collection of universally compatible widgets, including official news and video content from more than 1,000 of the world's leading brands and media companies. We measure our success by our share of leading brands -- we have 1,000 advertisers including CBS to the New York Times, Nissan, Nokia, and Ogilvy -- and by that measure we're doing well."
The key to Netvibes' business model is something it calls widgets. According to Mini, "Widgets are pieces of software that enable consumers to perform specific functions such as viewing their local weather, finding the best prices for flights, tracking stocks, or checking traffic conditions."
Mini continued, "We believe that widgets constitute a significant advertising market opportunity. That's because widgets blur the business model that existed between 1994 and 2009 in which an advertiser makes money only when the audience is on a site and stops making any when the audience leaves. Widgets blur that distinction because they maintain engagement with the audience after the audience leaves the site. And unlike display advertisements, widgets will be installed by users and will be used as long as they are useful."
Mini estimates that the market for widgets could total $5 billion -- if widgets can give those brand name advertisers greater revenues in return for their advertising spend, Netvibes could be making Europe more social for years to come.
Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College. His eighth book is You Can't Order Change: Lessons from Jim McNerney's Turnaround at Boeing. He has no financial interest in the securities mentioned.
