The Praized Blog

Bloomberg just published a short interview with Tim Kendall, Facebook’s director of product marketing for monetization. In it, we learn that small businesses seem to be embracing Facebook ads.

Facebook Inc. said the number of customers using its automated online-advertising system more than tripled in the past year, a sign more small- and medium- sized businesses are turning to the social-networking site.

The ads, which include text and photos, target users that might want to go to a local hair salon, hire a wedding photographer, or are close to buying other products, said Tim Kendall, Facebook’s director of product marketing for monetization. The service lets companies target users based on the information they put on their profiles, he said.

“You basically just have a greater diversity of people using our ad system — lots of businesses, lots of local businesses finding success,” Kendall, 32, said in an interview. “It’s really been a steady, successful growth pattern.” He declined to provide specific revenue data.

What it means: not surprised that early adopters in the small business community are creating ads on Facebook.  You can do great local targeting because many users have disclosed their location or city network. For example, in Canada, you can target over 1.3M people living in the Toronto area.  Additional targeting on age, sex, specific profile keywords, education, workplace, relationship status, and language allows for precise reach. For example, did you know 1,182,540 people have the keyword “travel” in their profile in the US? And you see your potential total “reach” in real-time in the targeting tool.

Because Facebook advertising is performance-based, you only pay for clicks to your web site or Facebook page.  I suspect though the click-through rate must be low today and that it’s currently  a number’s game, i.e. get the ad in front of as many targeted people as you can.

In my humble opinion, Facebook’s current ad product is not optimal. It still does not leverage the social connections (what are my friends buying or suggesting) or the social intentions (what were your recent status updates about? Are you signaling an unmet need?). When the Facebook product team pushes forward with improvements like those, expect ads to become very interesting from a ROI point of view.

To provide an actual example to my readers, I found this Facebook ad from a Montreal-area flower shop called Camille Fleuriste Boutique Inc.

They describe themselves on Facebook as “a full service floral shop with over 40 years of experience”. They created an ad that points to their Facebook page.  I wonder what their experience with Facebook ads has been.

As most people reading this blog know, I’m very active on Twitter (1000+ followers), Facebook (770+ “friends”) and LinkedIn (1300+ direct connections). I’m often asked how (and why) I use these three networks and wanted to share with my readers the usual answer I provide.

First, LinkedIn. According to their Web site, “LinkedIn is an interconnected network of experienced professionals from around the world, representing 170 industries and 200 countries. You can find, be introduced to, and collaborate with qualified professionals that you need to work with to accomplish your goals.” Launched in 2003, the site now has over 41 million members worldwide. LinkedIn has pretty much replaced my address book to find the most up to date contact information of my connections. It’s also how I find out when people change jobs or get promoted. It’s also extremely useful for business development opportunities. My 1300+ direct contacts give me access to more than 8.7M people in the site (that’s 22% of all LinkedIn members!). Suffice to say, I have easy access to almost everyone I need to talk to in the online media industry. I go to the site twice a day on average. I usually try to connect in LinkedIn with everyone I’ve met in person. I also accept connections from people that I’ve never met but have an interesting profile (high-profile individuals at known companies) or are connectors (headhunters, for example). If you fit those definitions, don’t hesitate to request a connection with me.

Second, Facebook. As most everyone know, Facebook is one of the leading social networking sites on the Web. According to their site, Facebook’s mission is “is to give people the power to share and make the world more open and connected.” Founded in 2004, the site now has more than 200 million active users and more than 100 million users log on to Facebook at least once each day. When I first joined the site, I started using Facebook pretty much like Linkedin, but even more openly. I started accepting invitations from almost everyone, especially if we had friends in common. Today, I’ve changed the way I use the site to make it more personal. I now connect in Facebook with friends, parents and close business contacts (usually means I’ve worked with you, I’ve met you many times at a business event and/or we’ve shared a great business meal/drink!). I use Facebook to post status updates (most of them originally posted in Twitter and mirrored in Facebook), interesting links, pictures I’ve taken (I don’t have a Flickr account) and I keep track of industry events I’m attending there. I find Facebook is a more interesting place to have “conversations” on people’s status updates because of the threaded nature of comments. It’s more personal. Facebook is one of the browser tabs I always keep open. In case, we know each other very well and you’ve slipped through the cracks and want to connect, I’m here.

Finally, Twitter. Twitter is a 140-character micro-blogging service. Started in 2006, Twitter is now used by 32M unique visitors worldwide (April 2009 ComScore data mentioned in Techcrunch). With its asynchronous connections (you don’t need to reciprocate a person following you), it serves as the perfect place for people I don’t know to connect with me. But I don’t follow everyone that follows me. I’m interested in individuals with strong opinions about almost anything and I’m not a fan of mundane things if I don’t know you well. I follow currently a little over 400 people while 1000 people follow me back. I use Twitter as a RSS reader, following my favorite bloggers, industry pundits and media sources in the Twitter feed. I also broadcast my new blog posts and interesting links related to the local/social media industries. I will also “tweet” personal stuff, often related to Montreal activities or interesting things I’ve seen (movies) or heard (music). It’s also a nice way to communicate directly with people through direct messages (in general, for my group, Twitter has replaced Facebook as the favorite way to send private messages). Twitter is another one of my open browser tabs. If you want to follow me, I’m at @sebprovencher

Found in Stowe Boyd’s blog:

Hashtags (Twitter tags) were proposed by Chris Messina, and in use by Chris, me, and others before tools existed to do much with them, aside from search. In similar fashion, I am proposing a new sort of microstructure, just a little bit ahead of tools to support it.

The idea is similar to tags: use a distinctive character to set off some microstructured metadata, although in this case, the metadata is location, and the character is ‘/’, the slash.

He gives as examples:

Just landed at /JFK

hanging at /Starbucks, 93 Greenwich Ave, NYC/

What it means: the same way that hashtags (#) are helping to structure and organize concepts on Twitter and other social networks, Boyd proposes to create a new “standard” around the use of / in short-form messages to help organize the information around “location”.  As he discloses, “I write this post with a ulterior motives, since I am involved in the development of a Twitter appliance, called Thweres, that will exploit location information of the form proposed here” So, I’m really curious to see what Boyd is up to and if this proposal takes off.

“The UK iPhone Mania” via eMarketer.

According to the first data to describe iPhone usage in the UK, from comScore, 93% of iPhone owners in the UK accessed mobile media in January 2009.

Nearly 80% of iPhone users accessed news on their phones, compared with 48% and 20% of smartphone and mobile phone users, respectively.

In addition the article mentions that nearly 55% of UK iPhone users accessed a social network site vs. 12.7% for mobile phone users.

Mini what it means: if anyone needed more proof that new smart phones are game changers from a content consumption / web usage point of view, you have the numbers now.

Day 1 of the Kelsey Group’s MarketPlaces 2009 conference. Jeff Berman, President, Sales & Marketing for MySpace, was on stage for a keynote address.

Of note in his presentation:

• Jeff described MySpace as a “social portal” halfway between a portal and a social network
• 40% of online moms in the US are on MySpace each month
• Their classifieds section, powered by Oodle, generates 500K postings a month
•  They’re recently introduced MySpaceID, their equivalent of Facebook Connect or Google FriendConnect
• When asked how do they differentiate MySpace from Facebook, he answers that Facebook is a social utility, a very powerful, elegantly designed, communication platform. But that there are no licensed music content and no licensed video content in it like you find in MySpace.
• When asked “what is your USP?”, Berman said ” Massive content platform, social discovery around music”.
• When asked if they’re interested in “local”, he started by replying that they’re careful before they go in a space because they don’t want to upset their large user base. They need the right model. They also need a foreseeable revenue component but he did say local was interesting to them.
• Questioned about their target market, the MySpace exec said “everyone”

Here is the Kelsey Group blog summary of the presentation.

What it means: a couple of thoughts. First, I got the feeling that MySpace is in this bizarre brand/product positioning situation. They’d like to be Facebook and embrace social networking to the max but they’re not there yet. At the same time, the music/video component of the platform is what makes it compelling to a lot of users. If you’re a new music group, you need to be on MySpace and personally, I often start my search on the site when I want to listen to new acts bypassing search engines completely. I also like the level of activity in their classifieds section. Not bad at all! Finally, on the “local” question, I decoded from Berman’s answers that MySpace is not going to play in “local” in the short term. They’re still trying to find a model that will work. So, what is MySpace? A music/video site? A social network? Given that they’re owned by News Corp, I think they should morph into a “social entertainment” destination and platform. The launch of MySpace ID (now available on Yahoo! by the way) should increase their relevancy in the social ecosystem.

This morning, Google announced the launch of Google Latitude, its location-based mobile social networking application for mobile devices. Similar to other products like Loopt, Whrrl and Brightkite, it allows users to position themselves on a Google map (either manually or using your phone’s GPS), leave a status update message (like on Twitter or Facebook) and share (or not) that information (location and message) with your friends.

Although the current service does not really innovate vs. the other three players I mentioned above, what’s very powerful is the ability to invite all your Gmail contacts (your “friends”) to connect to you in your mobile social network. Google understands that a large portion of your social graph resides in your e-mail software. Privacy is of utmost importance in a service like this and you can decide on various privacy settings for each friend. There is a nice online integration as well through an iGoogle application allowing you to interact with the service there.

What it means: think of Latitude as the next platform play for Google. Expect them to integrate it with Google Friend Connect to allow anyone to use those pieces of technology inside their own Web sites. I firmly believe that kind of feature/site infrastructure (friends/location/status updates) will be used by a majority of sites in the next five years and Google is hoping to capture a large portion of that market. Facebook, with its far superior Facebook Connect, is already ahead of Google on the friend infrastructure side but will need to play catchup and launch their own local/social platform as well in order to compete in that field.

Forrester Research just released their new 2008 Social Technographics data (report here)

Excerpt from their blog post:

Looking at the US data, the big news in 2008 is that, not unexpectedly, social technology participation has grown rapidly. Inactives — people untouched by social technologies — have shriveled from 44% down to 25% of the online population. Spectators — those who read, watch, or consumer social content — have ballooned from 48% to 69%. If you think social technology is about to become a universal phenomenon, we just handed you a nice little bundle of evidence. As you can see, there was also a nice healthy jump in Joiners (social network participants), Critics (those who react to social content they see), and especially Collectors (those who organize social content). None of these are quite as popular as being a Spectator, but I think there’s plenty of growth ahead for these groups. (…)

Where is the growth in consumption of online content coming from? From older people – the group my young colleagues who manage all this data call “middle-aged.” (Ouch!) Social activity is way up among 35-to-44 year-olds, especially when it comes to joining social networks and reading and reacting to content. Even among 45-to-54 year-olds, 68% are now Spectators, 24% are Joiners, and only 28% are Inactives.

Here’s what it means. It will soon be no more remarkable that your grandmother reads a blog than that she reads email. Social content is going mainstream. Social content ranks high on search engines because it changes so frequently and gets linked to more often, so more and more online adults are becoming exposed to it, accepting it, and embracing it. If you’re a marketer, no matter what group of consumers you’re targeting, this means you must pay attention to the social world online.

But the future of social applications online will not include contributions from everyone, because not everyone has the temperament to create content. Don’t count on all your customers to contribute, and don’t believe that what you see online is representative of your whole audience. The shy among your customers are reading this stuff, but most of them aren’t ready to contribute, and won’t be for a while.

What it means: Forrester does a great “what it means” above. Everyone will soon be interacting with social content somewhere on the Web, from reading to creating.

Mashable lists a series of recent sources for statistics on social media:

1) The Society for New Communications Research’s “New Media, New Influencers & Implications for Public Relations” (.pdf).  They “set out to conduct an examination of how influence patterns are changing and how communications professionals are addressing those changes by adopting social media. ”

2) Universal McCann’s Social Media Research Wave 3 (.pdf) research report, whose goal is to “measure consumer usage, attitudes and interests in adopting social media platforms ”

3) The University of Massachusetts Dartmouth Center for Marketing Research recently released “Social Media in the Inc. 500: The First Longitudinal Study” (.pdf)

4) Comscore recently released statistics on worldwide usage of social networking sites

5) A Rapleaf study revealed gender and age data of social network users

What it means: for data-oriented people like myself, it’s always good to have a handy list of credible statistics resources.

Without a compelling existing brand or a really innovative product with protectable intellectual property (some of the games fall into this category), the only chance these apps have for long term success is to start thinking about ways to have users interact with each other in order to build network value. I’ve long argued that social networking on the iPhone is a huge opportunity, and the fact that the big guys are ignoring it for now leaves the door open for a newcomer to get long term market share.

(From Most iPhone Apps Are Failing To Leverage The Network Effect on Techcrunch)

What it means: great insight from Mike Arrington today. I’ve also been talking about the fact that your mobile device is a social object. It holds your contact list, it knows where you are and it’s a multi-channel communication device. We’re not far away from a specific mobile device-centered social network. Is there a “Facebook” in Apple’s future? I wonder if it would be possible to integrate DiSo (distributed social networking) with open source mobile operating systems like OpenMoko, Android or Symbian?

According to this release from ABI Research, “location-based mobile social networking revenues will reach $3.3 billion by 2013 but successful business models may differ from what many observers expect”. They add: “While location-based advertising integrated with sophisticated algorithms holds a lot of promise, the current reality rather points to licensing and revenue-sharing models as the way forward for social networking start-ups to grow their customer base and reach profitability.”

What it means: First of all, I think “location-based mobile social networking” is a misnomer. From the get go, your mobile device is a social tool. It allows you to stay in touch with your friends via voice, e-mail, SMS and IM. Social and mobile go together like peanut butter and jelly! In addition, mobile and location have also a natural fit as the device moves with you (duh!). Finally, local search for me is a very social, it’s all about word-of-mouth. So, taking all that into account, “location-based mobile social networking” is really local search done on a mobile device. Now, based on that, I’m surprised ABI does not consider advertising (at least in their press release) as a way to monetize mobile social local search. It certainly looks like they’re underestimating the role existing local search stakeholders will play in this ecosystem.