MarketingProfs today has an interesting post from Leigh Duncan-Durst, a 20-year veteran of internet marketing and e-commerce, about some of the likely challenges Facebook will face as it develops its platform in order to be more relevant for marketers.
Do the math on 20 years: that puts Duncan-Durst in the interactive world in 1989. It’s worth remembering what that world was like. Back in 1989, I was involved in one of the early content deals for AOL: our company produced a daily news feed about media, similar to what you see today on MediaBistro or I Want Media, that AOL paid a fixed fee for. The investment on AOL’s part was to create awareness among the media and marketing community about the ease of use and value of their platform. After all, they had a strong foothold with consumers and believed they could develop that foothold into a powerful advertising & marketing business.
The challenge, as Duncan-Durst points out, is that AOL developed its momentum because it was easy to use and combined a number of different applications on one platform. All of the functions that AOL provided were available through assorted other channels on the digital networks. AOL’s genius was making it incredibly easy for their users to send e-mail, play games and connect with each other. The human force that propelled the service was the force of communications. This was the AOL’s root identity as a one-time network for Commodore 64 users — connect people who wanted to share information that would improve their experience.
The challenge AOL faced in creating an environment that would be effective for marketers had two foundational issues that were separate from the exogenous social issues of the day. (Those social issues where questions about the validity and practicality of interactive marketing, if you can believe it.)
One core foundational issue related to the industrial design of the service. Communications platforms are not easily translated into marketing platforms. Marketing is designed to augment and interrupt the consumption of a produced experience. Communications between people is by nature an unproduced experience.
Another core foundational issue related to the technical bias of the development platform. As a closed system, with proprietary code underlying the consumer experience, AOL had to create easy hooks for marketing product. While they were doing that, the interactive experience was undergoing a sea change: the web, with its open technology platform, became a more cost-effective way for companies to produce and distribute content — marketing or otherwise.
One of the confrontational negotiations we had with AOL back in the early 1990′s was about opening up our AOL content to our nascent web sites. AOL didn’t want any cracks in the wall; we wanted to leverage the early web sites that we built in order to generate a marketing platform for our advertising clients. Our dialogue with AOL was about one small backwater of content, but it spoke to the real issues that the company was facing around its platform, its limitations and the greater trends on the web.
Turn to Facebook in 2009. Facebook has created a service that has reconstituted the situational genius of AOL. Facebook has integrated a series of interactive applications and has created an effective way to create your own personal closed network. The service has put Facebook at the hub of a genuine human impulse: to participate in information transfer with people who are part of your personal social circle.
It is easy to look at the
350 million users of Facebook as a remarkable mass market that will create incredible value to marketers. And, the reports this week that Facebook’s revenue should top $700 million in 2010 point to the scale of the opportunity.
But, when you look at Facebook’s 350 million users, you need to think of them as 350 million personal networks, with, on average, 100 members. The power of Facebook isn’t its mass; it is in the multitude of small networks, and in the infinite array of overlapping synergies that exist within these networks.
Google is different. Google is able to identify a clear revenue strategy because the hundreds of millions of people who come to the search engine each day are there for one common purpose: to find information. They are looking for a produced media experience, and that search can be augmented and enhanced by marketing.
Facebook has at its core the momentum of communications. Its unique attribute is its ability to take what were once discrete communications — from individual to individual — and manifest those communications from the individual to a group.
In order to continue to maintain its primacy as an application, Facebook has to remain true to the consumer experience. In order increase its value as an enterprise, Facebook has to accommodate the needs of people with money — the marketers.
That’s the creative tension within the enterprise. It can be ultimately destructive, or it can be ultimately productive. It will depend on how well Facebook integrates its consumer focus with its marketing focus, accounting for the overriding trends of the Internet.
Duncan-Durst characterizes the challenge for marketers on Facebook today like this:
These are just a FEW of the many hurdles on Facebook that create higher barriers to participation — and negatively impact customer experience, interaction and revenue. The features aren’t terrible — they are immature. For those of us who were in the trenches with AOL — this is Deja Vu all over again. While the problems Facebook and AOL encounter are very different, the challenges of serving businesses users in a new channel are very much the same.
Her take is that if Facebook proceeds with an open, accountable bias, focusing on consumers and leveraging consumer interest in marketers, the service will be able to avoid many of the missteps that AOL experienced.
If developers — or investors for that matter — are allowed to create policies that damage the user experience, it will undermine the opportunity Facebook now has. However, if the team at Facebook can concentrate efforts on creating a more consistent, pleasing and positive user experience for both every day people and businesses they serve, it can bolster Facebook’s position.
This doesn’t mean Facebook has to be perfect — people are very understanding. It does mean Facebook should be a bit very careful to weigh the cumulative impact of iterative changes and releases on each audience. It means that Facebook may need to behave in a more humble manner, owning up to its shortcomings (including but not limited to the ones highlighted above) and proactively responding by making value-driven, iterative improvements. It’s my assertion that when this happens, there will be a very natural transition from this FREE for all model to more lucrative FEE-BASED model. That will make everyone — including the investors, pretty happy.
I’d add an additional prism to Duncan-Durst’s observations. Facebook also has to accommodate the overwhelming direction of the web. The technology arc of the Internet has a bias towards openness and simplicity. People have a bias towards privacy and convenience. The ultimate operating system on the web will b
e incredibly adaptive and well-organized. And it will serve as a fulcrum point for all kinds of transactions: human, commerce, information, knowledge, data, activity. Facebook has a natural bias to keeping the flow of information inside its walls — just look at their choice about giving Google access to the flow of content. Perhaps the bias should shift to trusting the consumer to make their own judgements about how their information should flow, what their network should look like. This trust would lead Facebook to evolve the application platform in such a way that it hands the consumer increased control.
Facebook would give up some opportunity for short-term value creation. But it would open up a long-term path that would rival Google’s for its deep embeddedness in the basic DNA of the web.
An earlier eMarketer roundup had shown that the base level tracking that most people apply to their social media marketing program is website traffic.
