Interesting article on asw in nyt

A Facebook for the Few
Christopher London/ManhattanSociety
BY INVITATION The guest list for a party at Hotel on Rivington in New York was mined from aSmallWorld.net.


By RUTH LA FERLA
Published: September 6, 2007
If more proof were needed that the rich are different, it could be found on aSmallWorld.net, an invitation-only social networking site.

Dean C. K. Cox for The New York Times
Erik Wachtmeister, the Web site’s founder, in Stockholm.
“I need to rent 20 very luxury sports cars for an event in Switzerland on the 6th September,” a member wrote recently on the Forum, aSmallWorld’s popular nucleus. “The cars should be: Maserati — Ferrari — Lamborghini — Aston Martin ONLY!”

Another announced: “If anyone is looking for a private island, I now have one available for purchase in Fiji.”

Founded four years ago, the site, promoted as a Facebook for the social elite, has grown from about 500 members to about 150,000 registered users. At a time when Christina Aguilera has 466,550 MySpace friends, aSmallWorld has attempted to create an Internet niche by cultivating an air of exclusivity.

The site functions much like an inscrutable co-op board: its members, who pay no fee, induct newcomers on the basis of education, profession and most important, their network of personal contacts. Sleeker than MySpace or Facebook, aSmallWorld.net is not the type of site where one is likely to come across videos of amateur motorcycle stunts or girls in bikinis.

Users are mostly young — 32 on average. Many have graduate degrees and a taste for living extravagantly on more than one continent. Sixty-five percent are from Europe, 20 percent from the United States and the rest scattered around the globe.

“We have put together a platform where a definitive group of people are separated by only three degrees,” Erik Wachtmeister, aSmallWorld’s founder, says often and loudly.

Advertisers were scarce at first. But in the last six months, luxury brands have come on board after a push from investors, including the movie mogul Harvey Weinstein.

The site drew a flurry of media attention last year, when Mr. Weinstein purchased a minority stake through the Weinstein Company, projecting that aSmallWorld’s membership could grow to a million within a year or two. SmallWorld is his sole investment in an Internet property.

Mr. Weinstein, who is diversifying beyond the film industry and recently acquired the fashion house Halston, would not say how much he paid, but he is the largest single investor in aSmallWorld. (Other minority investors include the film director Renny Harlin, the media executive Robert W. Pittman, and Alexander Von Furstenberg, an entrepreneur and the son of the designer Diane Von Furstenberg, an early advertiser on the site.)

The draw, Mr. Weinstein said without a shred of irony, is “direct access to some of the world’s most influential tastemakers,” a community he sees as early adopters and a natural market for his films, books and fashions.

“We’re dealing with a group of people that moves in social migration around the planet,” said Joe Robinson, the new chief executive. “From the point of view of a Mercedes-Benz or a Piaget, that makes this an enormous marketing opportunity.”

The Weinstein Company introduced Mr. Robinson, a former advertising executive with Fox Interactive Media, the owner of MySpace, to court advertisers like Lufthansa, Land Rover, Credit Suisse, Moët & Chandon and Burberry. Olivier Stip, the vice president of marketing for Cartier North America, said that an advertisement placed in June generated lively traffic for the jeweler’s Love collection.

Advertising rates are competitive with those of Forbes.com and Style.com, Mr. Robinson said. On average, clients spend $20,000 to $50,000 a month, he said. The company also arranges dinners and tastings where members can sample advertisers’ products. For one recent gathering, Rémy Martin supplied 4,000 bottles of its premium Cognac, valued at $200 each.

But the presence of advertisers raises questions about just whom they are reaching and whether this business model works.

Mr. Robinson said 35 percent of aSmallWorld members log in every day. But Andrew Lipsman, a senior analyst at comScore Network, a company that rates online usage, said that it is hard to track the number of unique visitors because the site is relatively small. “If there are a couple of hundred thousand registered users,” he said, “probably only a fraction are visiting the site regularly.” Compare that with Facebook, which in July had 30.6 million unique visitors, a number that has doubled since last year, Mr. Lipsman said.

Charlene Li, an analyst at Forrester Research in Foster City, Calif., said that for advertisers trying to concentrate on a group of influential people, a special-interest publication makes sense. “I liken advertising on aSmallWorld to advertising in the Harvard Business School alumni report,” she said. “For luxury advertisers, the online options are fairly limited.”

Skeptics are not sure just who is getting the message. “For truly wealthy consumers, time is the ultimate luxury,” said Pam Danziger of Unity Marketing, which researches luxury brands. “These people are not going to waste it hanging about on a social networking site.”


Those who do hang about often use the site to billboard themselves, advertising unabashedly pretentious tastes. A journalist in Vienna shared the news that her favorite Champagne was Henri Giraud — “I particularly like the 95 Grand Cru,” she wrote on the Forum. Another member recommended Eclipse, a bar on Walton Street in London, for its watermelon martini, “a tour de force.”

In reply to a query from a comely young woman searching for a hairdresser in Singapore, a Procter & Gamble executive there responded with a thinly veiled proposition: “I have two bottles of Nice n’ Easy in the cupboard. I’ll do it for free.”

The company does not publish members’ income or net worth, so their actual spending power is difficult to gauge. Hollywood strivers, fashion models, financiers and minor European royalty have been admitted inside its virtual velvet rope. But users also include publicists and party promoters who use the site as a personal database. In theory, they are just a few clicks away from Mr. Weinstein, a member, or boldface names like Naomi Campbell, Quentin Tarantino and Frédéric Fekkai. (Sycophants beware: members who engage in cyber-social climbing may find themselves exiled to the chilly Siberia of a Big World, aSmallWorld’s less-exclusive sister site.)

The site has drawn enough notice to breed its share of copycats. Milton Pedraza of the Luxury Institute, a New York research group, plans to introduce Luxury Ratings.com early next year as an advertising-free, gated online community; members will pay an annual subscribers’ fee of $250. He says members will each have a net worth in the millions or tens of millions. “They are not only resilient,” he said, “they are nearly immune to a housing or stock market downturn.”