How MySpace is like a sorority: Delta Zeta’s cautionary tale

February 26, 2007, 10:00 AM UTC
Fortune

A word about social networking, inspired by a New York Times story today out of my alma mater, DePauw University.

It seems one of the sororities at DePauw, Delta Zeta, has kicked out the overwhelming majority of its active members for being less than committed to the recruitment process. Since I’m a DePauw alumnus, I can translate that for you:

The national organization kicked them out because they weren’t attractive enough, and that was hurting the house’s chances of getting new members.

To those unschooled in the ways of the greek system, this might seem like a non-story. Aren’t sororities known for excluding people based on looks? Well, yes. But they normally do their excluding up front, by keeping certain girls from joining. It’s nothing short of scandalous for a sorority to show girls the door once they’re already “sisters.” The titillating nature of the scandal had sent the story to the top of the popularity charts at nytimes.com by the time I found it this morning.

After I saw the DZ story, I ran across another Times story that made me smirk. It seems there’s a business selling attractive “friends” on MySpace (NWS) to people who want to look popular with the in-crowd. The business was creating fake MySpace profiles using photos of models, and charging 99 cents a month to rent the fake friend. Apparently business has been healthy.

The connection here? Looks like online social networks aren’t that different from some real ones. Pretty, fake friends are often judged to be more valuable than real ones.

I think the DZ incident could also yield lessons for online social networking startups. The most important lesson is that social networks are actually commodity markets where people are the products, and they are willing to pay for access to active, “attractive” members. The definition of attractiveness varies by social network; on MySpace, it’s one’s looks and cool factor; on LinkedIn it’s the quality of one’s professional connections; on Match.com, Yahoo Personals (YHOO) and other social networking sites for dating, it’s one’s looks, personality traits, and proximity to other singles.

The DZ incident also suggests is a new lesson: Networks that don’t have enough active, “attractive” members become stagnant and die.

This is a longstanding, sad truth of DePauw’s greek system. The sororities with the cute girls, and the fraternities with the cute guys, never had trouble with recruiting members – in fact, they were literally turning people away at the door. But once a house started to lose track of its true mission, things started to slide. Like it or not, DePauw’s fraternities and sororities exist to feed the party-based, hookup-heavy social atmosphere. That might not be why the members want them to exist, or what the organizations’ founding principles are, but that’s the reality of the market in which they operate. No greek house stocked with hot guys or girls ever faced extinction over a lack of math majors. But often the houses with dwindling membership manage to post decent GPA numbers.

I have a feeling we’ll see the same principles playing out online. Social networks that are good at identifying the ways in which people are attracted to each other – romantically, professionally, financially – will continue to emerge. The ones that manage to aggregate the most attractive members and keep them excited will thrive and find new business models. The ones that don’t will end up like DePauw’s DZ chapter.

It’s not fair and it’s not particularly nice. But as some of us learned in college, the social networking business rarely is.