As could be expected there is a lot of strong reaction to Facebook's new SocialAds program, ranging from the interested to the irritated in some instances but also pointing towards legal concerns in other instances. As noted in PC World a law professor at the University of Minnesota pointed out that Facebook might be in violation of privacy statues in several states - including New York and California. At issue is SocialAd's appropriating the name or likeness of a person for commercial purposes without explicit consent in their terms and conditions for such uses. It's an important and compelling angle to the new system that probably should have been thought through more carefully by Facebook, but also one which points to further refinements that might increase the potential value of the innovative contextual ad program.
The lack of a voluntary opt-in for SocialAds is certainly a potential legal concern but more importantly it does not allow advertisers to take full advantage of the power of personal endorsement. By linking ads to user posts without explicit permission the ad is only loosely associated with a person's personal endorsement of a product or service - one assumes that there's a positive impression of a product or service if someone bothers to mention it in their Facebook posts but the strength of that endorsement is not easily understood by someone viewing the ad. Is it a like, a love, or relative indifference? If I went to that restaurant that I mentioned in the post, was the food really good or was I just name-dropping to impress my friends and colleagues - and did I actually pick up the check?
A potential solution to this dilemma is seen in the other new ad feature on Facebook - pages for products and brands. Individuals can declare themselves "fans" of commercial entities with Facebook pages, a feature that seems to have been used mostly by a company's employees so far but that could expand in time to include real fan bases. This sort of passionate and loyal grass roots backing is what author Kevin Roberts refers to as "lovemarks," endorsements that have legs far longer than even superstars such as Michael Jordan backing the brand of basketball shoes for millions of dollars. Lovemarks get their endorsements for free - and with a little tweaking Facebook's SocialAds could be adjusted to tie "fan" endorsements to SocialAds placement to ensure that their presence in a fan's posts represented true enthusiasm for an advertiser's brand.
What has gone begging in this equation so far, though, is an obvious opportunity: if personal endorsements from sports superstars who aren't necessarily passionate about a product can command millions, why shouldn't the personal endorsements of Facebook members via SocialAds for benefit the person giving that implied or explicit endorsement more directly - and be under their control more directly? For example, if I am a person who's very influential in my online community or in a real-world community shouldn't SocialAds be able to reward me financially for their endorsement - or to enable them to funnel funds paid by an advertiser to place a SocialAds ad to their favorite charity or cause?
While such a mechanism alone would not address the potential legal exposures for the SocialAds program it may provide the incentive for people to participate proactively - and, in doing so, accept the legalisms that would apply to their use of personal endorsement. There are some potential complexities in such a system - would a member set a minimum bid for their endorsement rights or would this be determined algorithmically, or both? - I think that this is the likely direction in which systems such as SocialAds are likely to head. If being rewarded for endorsements works for sports superstars and other notable figures in mass media, why shouldn't it work in more highly focused social media as well? It's an interesting issue that is likely to unfold in a bigger way over the next several months.
(NOTE: See the ShoreViews Video on this topic below in this post.)
At the recent Future of Business Media conference one of the key trends outlined by the speakers was that B2B media knows that social media is an important trend but that they are very reluctant to engage with social media tools. Most mainstream consumer publishers are about as far along, if truth be told, but it's of crucial importance that they wake up and see the opportunities in social media before others begin to skim off the best revenue opportunities.
One of the best examples of that can be seen in the recent launch of Facebook's advertising features, which are unlike most other tools used for marketers trying to reach audiences. Instead of just throwing up banner ads or typical CPM-oriented ad networks, Facebook is leveraging the power of their own social network to make companies, products and brands a real part of the Facebook community on a peer basis. The new Facebook marketing capabilities consist of two key components: SocialAds, which enables advertisers to get messages into the feed of Facebook activity appearing on member home pages, and Facebook pages for companies and products.
The SocialAds implementation on one level is not too different from any other ad feed that might appear in a weblog's RSS feed but with much more powerful capabilities based on member profiles and activity. An advertiser can target members on Facebook based on their personal profiles, including interests that match up with keywords, targeting both very small communities and very large communities based on those parameters. While keyword selections are fixed, as opposed to being able to define one's own, this still allows a fairly fine degree of targteting.
But the kicker in SocialAds is in the ability to link an ad to a member's reported activities on Facebook. So, for example, if a member visited a particular restaurant a graphic with a sponsored link to that restaurant could appear as a part of that member's post. Since there was probably a positive reason that the member mentioned this restaurant this then provides a very powerful personal endorsement to the advertiser, linking word-of-mouth directly to advertising. This is something very new and extremely powerful in advertising, a development that is potentially as revolutionary as Google's AdWords sponsored links were several years ago.
The introduction of Facebook pages for companies, products and brands is a more subtle features but equally important in its ability to support social media marketing. There are already more than 100,000 commercially-oriented Facebook pages for companies (our company page here) and their power is that they are so much like any other member's page. You can post company or product profiles, videos, links or any other type of content that you think is relevant, but the real value is that members can declare themselves "fans" of your commercial page - a high level of endorsement that enables a brand or product to become in effect a peer member of one's social network.
This is a positioning for marketing and messaging that for the first time really enables marketers to act in conversations within a social community as true peers. Certainly Second Life has shown the way on these types of capaiblities with its ability to allow brands to show of their stuff in virtual reality, but in Facebook's community it's less about glitz and more about rubbing shoulders with bona fide human beings rather than users wrapped in fanciful avatars with who knows what real persona behind them strolling into an online shopping mall. In Facebook pages a brand is less about exhibitionism than it is about engaging customers on a very personal basis.
Not all is sweetness and light in this new marketing environment - why is a sponsored link to ESPN's Pontiac-sponsored online site appearing in my news feed? A little TOO broad targeting, perhaps - but with futher refinements by Facebook and further refinements by Facebook members to indicate the kind of commercial messages they feel comfortable receiving the more powerful this kind of environment will become. It's perhaps a sneak preview of the kind of marketing environment that Google's OpenSocial may be able to make available to companies wanting to extend their message into a wide variety of media platforms that want to take advantage of the power of social media applications.
In the midst of a very busy week of product announcements bookmark Facebook's new marketing capabilities as one that you're going to the talking about - and thinking about - for a long, long time. This is just the beginning of a new era in conversational marketing that will change forever how goods and services enter the conversation of the marketplace.
For a visual run-through of how this all works take a peek at the following ShoreViews Video:
