The most obvious, the most compelling business model for Facebook is advertising. With the profiles of over 800 million consumers in its grasp, the obvious thing to do is offer those consumers stuff they want. However, with an IPO looming and institutions adept at profit making ready to invest, the most obvious thing for those institutions is for Facebook to deliver huge quantities of revenue, quickly. Facebook faces a dilemma.
Yet Facebook is still a social medium, not a commercial one. The money-makers will need to be careful how they tip the balance. There is a fine line between intuitive, contextual, well-timed messages being delivered with elegance and under-statement to consumers who welcome them and simply using targeted advertising like a rifle. The size and influence of Facebook’s customer base (are they even customers?) means that fashions can and do exist, and turn, within its walls.
Take the control of the environment away from its users and turn Facebook into just another marketplace where your head buzzes from the noise of adverts, and users will stop using. According to the latest Pew Internet and American Life Project, via Forbes, about 75 percent of consumers think it is an invasion of privacy for companies to track their internet searches even in order to offer them more targeted advertising. This is a sign that says ‘if you go down the road of targeted advertising, do it really well.’
We are at a point in the story of technology and human interaction where seismic changes are happening in advertising, payments and commerce and in these periods of time great wealth is won and lost, empires rise and fall. To win, you have to take the people with you, not turn them against you.
Facebook, young as it is, now finds itself the incumbent, the giant, and therefore the target of media and madmen alike. New technologies are being developed that make money off the money that Facebook makes. A company that has not even started up yet announced it is going to launch a business on the concept of paying users for recommendations – a sort of Trip Advisor meets Advertisers via Social Media – and will pay consumers for recommendations. This, according to redKonnect will provide highly targeted advertising for brands, and incentives for consumers. It is possible, so the release goes, for a customer to leave a restaurant he likes, and by recommending it enough, cover the cost of the meal. That sounds great.
At this point about a million twenty year olds are thinking ‘cool, I’ll tweet the guys, go viral at Luigis and get some dude in a suit to pay for the meal.’ That said, it now seems that viral is not as, well, viral as we were lead to believe. AllFacebook.com has just completed a study to find the percentage of pages that go viral at all – and it seems the answer is that about 61 percent of pages have a ‘virality rate’ of about 1.9 percent. A tiny percentage perhaps, but in real terms probably enough for our twenty year olds to seriously abuse the system.
Whilst the platform opens itself up to abuse from the users themselves, as well as the remora that live off the giant, cracks are appearing at the other end and eroding the trust that is essential to the continued survival of Facebook.
‘Someone’ – thought by some to be sponsored by the Chinese State – put up a fake profile of NATO’s Allied Supreme Commander and a lot of high, but wanting to be higher, level military folk ‘friended’ him. No-one knows, or no-one will admit, how much data was harvested from the Supreme Commander’s now destined to be lower level military friends, but the answer seems to be an embarrassing amount.
Worse, now that the favourite way of accessing Facebook is becoming the mobile device, an extra level of data can be harvested by those to wish to harvest it – exactly where these military folk are. With the advent of timeline mapping, they can potentially plot their journeys to and from work and wherever they go in between. When timelines become compulsory and Facebook becomes a mobile driven environment – if Zuckerberg had invented Facebook now, it would have been a mobile app – Facebook will provide more information about us than we should be sharing, even by today’s standards.
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