Facebook Offers a Ready-Made Marketing Platform

Facebook Offers a Ready-Made Marketing Platform Jeremiah Owyang Senior Analyst, Social Computing Dec 5, 2007 Keynote Presentation for Web Community Forum Theme Facebook, a ready-made Marketing platform, offers a vast toolset (with challenges) but brands must first develop a strategy 2 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Agenda – 1. Why Facebook? 2. Facebook offers a bevy of opportunities 3. Challenges of Facebook Platform 4. Develop a Strategy 3 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Why Facebook 1. Rapid Adoption and Demographics 4 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Timeline Launch: Harvard/College Only Open to Public Pages and Social Ads 2004 2005 2006 2007 2008 Application Platform 5 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook keeps growing • Social Utility • 40-50Million users • 134-200% growth or more in last year • over 40% are over age 35 • 6000 (Updated: 10,000 now) applications deployed • Valued at $15 Billion • Average visitor stays 20 minutes • Domination North America, Middle East • College Educated • White Collar 6 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook could eclipse MySpace Early 09 200 Million Friendster = 25 million | 65% Growth Facebook = 40-50 million | 200% Growth MySpace = 120 million | 72% Growth My Space Friendster Facebook 2002 7 2003 2004 Q4 2008? Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook, why should I care? 1. Rapid Adoption and Demographics 2. Communities are important 8 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Members use Social Networks for Communication See what my friends are up to: Sent a message to someone: Posted/updated my profile: Looked at profiles of people I didn‟t know: Searched for someone that I used to know: Send a friend/connection request: 86% 79% 70% 65% 59% 53% Listened to music: Read a blog or journal: Wrote on someone‟s profile page (e.g. wrote on a wall, posted a testimonial): Watched a video: 47% 51% 55% 40% Base: US online adult social networking site users, Source: North American Technographics Media And Marketing Online Survey, Q3 2007 9 Entire contents © 2007 Forrester Research, Inc. All rights reserved. …Which inspires trust 10 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook, why should I care? 1. Rapid Adoption and Demographics 2. Communities are important 3. Rich User and Network Data 11 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Rich user information 12 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Affinities 13 Entire contents © 2007 Forrester Research, Inc. All rights reserved. And network data 14 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook, why should I care? 1. Rapid Adoption and Demographics 2. Communities are important 3. Rich User and Network Data 4. Information Spreads Quickly 15 Entire contents © 2007 Forrester Research, Inc. All rights reserved. News Feed encourages spread of ideas Trend Watch: News Feed Optimization (NFO) 16 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook, why should I care? 1. Rapid Adoption and Demographics 2. Communities are important 3. Rich User and Network Data 4. Information Spreads Quickly 5. Other Platform Features 17 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Groups and Communities 18 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Inbox: A “new” email Trend Watch: Email is for “old” people 19 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Embedded Media –with social hooks Trend Watch: “Micromedia” 20 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Agenda – 1. Why Facebook? 2. Facebook offers a bevy of opportunities 3. Challenges of Facebook 4. Develop a Strategy 21 Entire contents © 2007 Forrester Research, Inc. All rights reserved. The Many Opportunities for Marketers • Advertising » Banner Ads » Contextual//NewsFeed/Flyer Ads » Social Ads • Marketing » Facebook Pages and Sponsored Groups » Beacon • Word of Mouth/Interaction » Applications • Intelligence » Profiles and Network information » Public Groups 22 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Banner ads Recently, Microsoft invested in Facebook, broadening it‟s Advertising opportunities 23 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook Ads Facebook Ads provide accuracy, controled spend and metrics –all self-service 24 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Targeted Advertising 25 Entire contents © 2007 Forrester Research, Inc. All rights reserved. …although accuracy questioned Image via David Parmet www.parmet.net/pr/ 26 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Sponsored Groups: Branded Interaction 27 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Case Study: Wal-Mart’s Back to College • Media “Soundcheck • Personalized “dorm” • Recommend to others • No discussions • Results » Lack of community involvement » 800 members in two weeks 28 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Target’s Rounders Program • "Your Mission: Try not to let on in the Facebook group that you are a Rounder," the newsletter read. • "We love your enthusiasm for the Rounders, and I know it can be hard not to want to sing it from the mountaintops [and in the shower, and on the bus]. However, we want to get other members of the Facebook group excited about Target, too! And we don't want the Rounders program to steal the show from the real star here: Target and Target's rockin' Facebook group. So keep it like a secret!" 29 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Case Study: Apple Students • Embracing existing community » Free product sample » eCommerce » Cross Promotion • Results » 420,000 users » 12,000 topics 30 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook Pages allow brands to collect “fans” 31 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Remember Trust 32 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Ads displayed to friends of brand fans “Fan-Sumers” 1. Users can “poke” each other with branded viral messages -- combine social actions such as a purchase of a product or review of a restaurant – with an advertiser‟s message. 2. Brands can buy paid ads. (Frequency capped – users will see no more than two per day). Users „dial‟ the frequency of the ads. 33 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Beacon: Third Party Partners can Reach Facebook Network • Opportunities » Greater Trust (if done correctly) • Challenges » Not Opt-In » Many Privacy concerns » Resistance to peer based recommendations » Brands need to „converse‟ to get fans 34 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Companies using Beacon Blockbuster Chase The Coca-Cola Company Verizon Epicurious.com Flip.com Crest Whitestrips (whitestrips.com) Owned by Proctor and Gamble Dove Cream Oils (Dove.com) Unilever Company Herbal Essences (herbalessences.com) Clairol Division owed by Proctor and Gamble NYTIMES.COM Saturn AllPosters.com Bluefly.com CBSSports.com Dotspotter ExpoTV Gamefly Hotwire Joost Kiva Kongregate LiveJournal Live Nation Mercantila National Basketball Association Overstock.com (RED) joinred.com Redlight (stay away from adult sites any one of them can be this redlight company and be telling your friends about your sex fetishes. Yuck!) SeamlessWeb Sony Online Entertainment LLC (station.com) Sony Pictures STA Travel (statravel.com) The Knot TripAdvisor Travel Ticker TypePad viagogo Vox Yelp WeddingChannel.com Zappos.com ebay bluefly.com Travelocity echomusic pronto.com citysearch Iwon Busted Tees College Humor (same company as busted tees) Fandango Red indicates hesitation after BeaconGate 35 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Widgets: Branded Affinity Groups 36 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Widgets Proliferate on Facebook • Over 78 million widgets live on Facebook • Over 42 million monthly unique visitors User Direct Friends Indirect Friends • Growing 900K new users a month • Over 700K widgets embedded daily Interested Parties 37 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Opportunities for Widgets: • Span multiple networks • Even Smaller developers can monetize » Use existing Ad Networks • Advertisers » Skin, Co-Brand 38 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Case Study: Vampires and Movie “Skins” 39 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Agenda – 1. Why Facebook? 2. Facebook offers a bevy of opportunities 3. Challenges of Facebook 4. Develop a Strategy 40 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Challenges 1. Facebook Data sucked into “Black Hole” » » Lack of Web Analytics for Marketers User Data 2. Facebook releases features –without aligning with customers » » Newsfeed Beacon 3. Workplace productivity concerns • Some companies will block 4. Privacy Concerns with Beacon 41 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Beacon Revolt 42 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Agenda – 1. Why Facebook? 2. Facebook offers a bevy of opportunities 3. Challenges of Facebook 4. Develop a Strategy 43 Entire contents © 2007 Forrester Research, Inc. All rights reserved. The four step approach to the groundswell P O S T 44 People Assess your customers‟ Social Technographics profile Objectives Decide what you want to accomplish Strategy Plan for how relationships with customers will change Technology Decide which social technologies to use Entire contents © 2007 Forrester Research, Inc. All rights reserved. Demographics and Technographics • Is Facebook my audience? • How do they use technologies? • What are they talking about? • Who are they? • What do they want? 45 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Objective: What are you trying to accomplish? Goal Listening Contribution Direct Customer Insight Examples •Earnst and Young Careers (Sponsored Group) •Profile Research •Sponsored Groups (Jeep, Apple) New Product Ideas Beta Testing Speaking Create an emotional Attachment Advertising based on network Energizing Supporting •Advertisements •Victoria‟s PINK •Applications •Customer created groups Excite your biggest fans Word of mouth Peer –to- peer support Embracing Members become contributors •Sponsored Groups 46 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Strategy and Tools 1. Analysis: Build or Join 2. Experimentation leads to Understanding 3. Gain Market Intelligence 4. Advertise Efficiently 5. Embrace and Lead Communities 6. Deploy Campaign » » » Widget Sponsored Groups/Pages Integrate 47 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Best Practices • • • • • • • Listen before Speaking Members are in control Allow for discussions Segment Media as a “lead in” Trouble Kick starting? Be a resource, and reward Integrate with Marketing Initiatives 48 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Phases for Deployment Maturity novice Aware of „distributed‟ brand, monitoring and observing communities of practice Strategy Strategies should compound Understand Facebook, experiment with existing tools, deploy Advertising intermediate Already has deployed other social media strategies, increasing budget and resources Join related groups, build and deploy group or Facebook page advanced Uses social media tools for most product launches, crises, measures and has resources Deploy applications, integrate experience with other web vehicles, segment 49 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Cost considerations…Facebook • Costs: (Time/Capital) » Research $0 » Development, Design = $0 - varied » Advertisements = cheap to large » Sponsored Groups $100k/month =May be opportunity gain 50 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Thinking bigger… 51 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Don’t limit to Facebook • Brands should not limit strategy to Facebook Alone • Prepare for The Distributed Web • Understand OpenSocial • Understand the Aggregation of Social Graph • Tools come and go, what sustains is a strategy 52 Entire contents © 2007 Forrester Research, Inc. All rights reserved. What it all means… 53 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Facebook: • Many tools, many opportunities • Privacy and Data concerns • Develop a Strategy » People » Objectives » Strategy » Tools • Learn to think bigger 54 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Theme Facebook, a ready-made Marketing platform, offers a vast toolset (with challenges) but brands must first develop a strategy 55 Entire contents © 2007 Forrester Research, Inc. All rights reserved. Thank you Jeremiah Owyang Senior Analyst Social Computing Forrester Research web-strategist.com/blog __________________ Web Strategy Facebook Group 56 Entire contents © 2007 Forrester Research, Inc. All rights reserved.