Facebook's Like Button on Levis.com

Facebook ‘Open Social Graph’ project ‘to put people at the centre of the web’ took a big leap forward with a series of announcements made at last week’s f8 developer conference.

The most significant of these was the launch of the new web-wide ‘Like’ button, replacing their ‘Facebook Connect’ functionality.  Web site owners will be able to easily add ‘Like’ buttons to their web pages, allowing any user who is logged in to Facebook to express a preference for that brand, page or product.

That preference will be shared with the user’s connections on Facebook, where their friends will be able to comment on it, but will also create a link from the user’s profile back to the page – creating a stream of ‘recommendation’ traffic to the brand owner’s or publisher’s website. In addition, by combining that preference with semantic data entered by the site owner, using Facebook’s ‘open graph protocol’, a ‘permanent’ (until deleted by the user) link can be created on that user’s info page. For example, if a band was ‘liked’ then a link to that band’s site would be added to the music section of the user’s info page.

The tools launched by Facebook also allow site owners to personalise the experience on their sites to individual users based on their friends and other Facebook user’s preferences. For example, the  ‘Activity Feed’ plugin will be enable site owners to show users what their friends are sharing, commenting on or recommending from their site, whilst the ‘Recommendations’ option expands this concept to show interactions with the site by all Facebook users, or as Facebook themselves put it ‘a people powered most popular list’.

But the most powerful function is one that allows site owners to combine semantic data with ‘Like’ data to personalise a user’s web experience when they visit their site. For example, know that a user ‘likes’ a celebrity, then as long as they’re logged into Facebook you can deliver them recommendations for clothes and accessories to re-create their look when the user visits your site by tagging your pages appropriately.

Facebook’s leaders hope this will make the web a more social place – where you friends are ever present, guiding you to the most relevant news, the best places and the best products and even going ‘shopping’ with you, albeit virtually. Will it take off? There is little doubt – Facebook is fast approaching 500m users and its pace of growth is accelerating rather than declining. In addition, 25 billion shares between friends already occur monthly on the site and Mark Zuckerberg, Facebook’s Founder and CEO, confidently predicted 1 billion ‘Likes’ within 24 hours of the service being launched.

There is no doubt that for premium and luxury brands, these could be powerful tools.  Levi’s have already announced a ‘Friends Store’ in which customers who are logged into Facebook can see a list of all of their friends favourite Levi products and shop with their friends online.

But these tools are going to be more useful to brands with more accessible price points and a larger following.  Firstly, a larger following is going to be necessary for the Facebook tools to deliver any meaningful data – the more accessible the brand the more likely browsers are to have friends that ‘like’ that brand too. And the more friends they have interacting with a brand and its products, the more likely they are to come across one whose opinions they trust in that product category.  Secondly, the more affluent consumers become, the less likely they are to trust the opinions of their friends and much more likely to trust their own research and judgement.

But perhaps the most significant development comes from what Facebook isn’t telling us – at least, not yet.  Facebook already understands our demography, our interests, our favourite brands, our friends and what we choose to share with those friends.  This new functionality also helps it to build a more complete profile of our web preferences. This is powerful information for all advertisers and could make Facebook an important, if not the most important, advertising channel for premium and luxury brands.

By: Carla Burgess

Posted in Online, Social Networking | No Comments »

Starbucks Trials Promoted Tweets

After much speculation, Twitter have finally announced their plan to monetise their platform.

Promoted tweets were launched last week and much like paid for search ads they will appear at the top of search results and be differentiated from an ‘organic’ tweet by a small piece of highlighted ‘Promoted by..’ text.

Initially, promoted tweets will be charged on a cost per thousand model but this will soon be replaced with a return on investment model.  To challenge advertisers to keep ads relevant and to ensure they achieve a return on investment by matching costs to success, Twitter  will track something they’ve dubbed as ‘resonance’. Resonance will measure user interaction with a promoted tweet, including replies, re-tweets and clicks. Those ads that don’t resonate will soon disappear but brands and companies will not pay for ads that fail to catch on.

At present, only a test is being run with a small selection of advertisers including Starbucks, Red Bull, Sony Pictures and Virgin America so that both twitter and the advertisers can understand how the twitter community reacts to and interacts with this innovation. The aim longer term is to extend the service to twitter clients such as Hootsuite, TweetDeck and Seesmic as well as serving ‘promoted tweets’ within users’ timelines, using their interests, connections, and tweets to serve relevant ads.

So what’s in it for advertisers?  Well 100m+ users and 600m searches per day for starters, offering a mass audience attractive to advertisers.  In addition, the use of promoted tweets will allow them to achieve standout but also to focus attention on a particular message or messages that they want to promote – a message that might otherwise get lost several pages down a user’s timeline without frequent (and irritating) repetition.

For users, the search based offering delivers many of the strengths of Google Adwords – relevant, timely results based on a users requirements. However, when the service moves to serving promoted tweets within a user’s timeline timing become in particular becomes more complex.  By looking at who a user is following, what they search for and what they themselves tweet, if will be possible to understand their interests and serve them relevant ads – but when are those ads timely?  When they tweet on that topic?  Perhaps when users become used to the service they’ll start tweeting for the sort of offers they want and find relevant promoted tweets popping up at the top of their timelines.

As for premium and luxury advertisers, it’s difficult to scope the opportunity from a commercial perspective as there are too many unknowns.  Demographics are important to luxury advertisers as it’s not just about the what (are they interested in) but the how (are they going to pay for it) and information on twitter is sketchy in this regard. What stats exist suggest a bias towards, females, the under 35s and higher income earners, which suggests an opportunity for premium fashion and health and beauty brands in particular. If personalisation can be combined with a degree of automation, Twitter could become an extremely effective channel for brands in these sectors to deliver timely, relevant and highly targeted offers.

The other information ‘black holes’ are who is searching for what, interested in what or tweeting about what in what volumes. Logic would point to the launch of tools similar to Google’s Keyword Research tool when the concept is rolled out and until then, and twitter’s initial first test phase of promoted tweeting has been completed, even Twitter’s own founders are as much in the dark as the rest of us as to the potential of promoted tweets to meet advertisers (and their investors) needs.

By: Carla Burgess

Posted in Online, Social Networking | No Comments »