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Facebook brings social (media) Darwinism to brand pages

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As a pragmatist it was with great joy that I read of Facebook’s new metrics for brand pages. Hailed as giving brands new tools to measure engagement and word of mouth, I think these new metrics will be game changing in the Thunderdome of marketing.

Among the new batch of stats are a few sizzly big number metrics to make myopic brand managers dewey eyed. Measures like ‘friends of fans’ will have some folks salivating at the huge aggregate numbers of people that *could* be reached. That’s been social media’s big selling point for the past three years – the potential of the cumulative network effect – and no doubt it will continue to sell. Plus, these new numbers will make it personal – now your brand will be able to see its very own potential Facebook reach.

But the really useful numbers, in my opinion, lie outside the big potential reach values and are the ones that help contextualize measurements like fan counts.

Up until now trying to get a bead on what ‘engagement’ really means has been tricky. While terms such as ‘like’, ‘fan’ and ‘follow’ imply a certain level of conscious attention toward the liked/fanned/followed brand, there’s been scant real proof as to just how active those fans really are.

Facebook is starting to change that.

They like you, but do they really like you?
Soon a brand will be able to look at the proportion of its ‘fans’ who actually talk about and share the pages and content they’ve ‘liked’. They’ll be able to see the “weekly total reach” too, which will help indicate how many people (and news channels) spread the brand’s content across those delicious networks of potential reach.

These new metrics will be helpful in contextualizing the actual engagement of one’s fan count. For example, one very well-fanned Facebook page had wall postings averaging 4000-7000 ‘likes’. At first blush, that sounds awesome. Then I looked and saw they have 22MM ‘fans’. Taken as a proportion of the overall fanbase, that’s a response rate of three hundredths of a percent. By contrast email open rates seem to hover in the area of at least single percentage points (more here, and here too). Even FSI’s seem to score in a similar neighborhood (also, here) in terms of their redemption rates.

Now, before you get all disgruntled and start calling me a hater, I am not saying social media don’t work. Far from it. Social media are extremely powerful. More direct and intimate than any other media channel today.

I am also acknowledging that comparing comments on a wall post to FSI redemption rates is apples-to-oranges. The point is not the percentages. I am simply calling attention to the fact that that social media statistics are often served up without context. When context is provided – as above – it can at least give us reason to stop and think. (And that is never a bad thing.)

Yes, yes, I agree that using social media is not all about getting ‘likes’ and comments to posts. And yes, it’s true, you might be getting a lot of impressions with those posts and may be building some good brand perceptions along the way. All of this is very important and should not be dismissed.

But a big premise of social media is ‘engagement’ and ‘earned impressions’. As noted before, social media has been selling against these terms since its commercialization. But ‘engagement’ implies people DOING SOMETHING, not just observing a wall post as they would a banner ad. You can’t call yourself an engagement medium and then measure yourself by impressions and perception building alone. Social media is growing up, it’s time to ditch the kid gloves and raise our expectations.

Asking better from brands and agencies.
Facebook is raising the bar and doing so in a way that is truly authentic to the spirit of social media – right out in the open for everyone to see and share. By including the “people talking about” metric in public view, right on a brand’s page, visitors and page administrators alike will know whether the page is popular. That’s dropping the glove in a big way. No more can brands quickly claim victory simply by accruing six figure fan bases. A quarter of a million fans won’t matter as much if right below that head count is another number saying that only a few are bothering to talk about the page and its contents.

Moving forward, engagement will move from theory to practice and agencies and brands are going to have to do something to earn the attention and interaction of Facebook fans. The numbers won’t let us hide behind vapid claims.

Facebook has issued a challenge and client and agency will have to work together to be truly remarkable now. It’s a brilliant move on Facebook’s part (they’re on a roll) because they’re essentially guaranteeing their advertising partners will have to up their game and provide a better Facebook experience.

In some ways, it will be survival of the fittest. Then again, as my college mentor once said, “Nothing motivates like the fear of extinction.”

Outposting & Irrational Exuberance

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Staking a parcel of land in a new digital space is easy. It can lead to big sexy headlines and snap-judgement misassumptions.

Mashable wasted no time last week noting that Google+ has ‘signed up 13% of the U.S. population‘ and could be larger than LinkedIn or Twitter within a year.

Exciting news to be sure. And in some ways, given Google’s reach with its search service, etc. not surprising. I question the prediction though. Via an admittedly unscientific survey across my own Google+ circles I see a lot of outposting going on.

I define outposting as the rushing out to stake a claim to a new site or service online without intention to actively engage with it immediately. Outposting is done to reserve our account name. To be seen there. And to take a peek to see what all the noise is about. The rewards for outposting are well known. Having your name locked up – especially if its John Smith or similar – has a certain first-mover cache and is good for those concerned with their personal brand. Outposting is also a little like investing a small amount in a stock on the chance it gets big someday. Plus, as with many things online, the actual investment made in outposting is pretty small – about 10 minutes of your time – so why wouldn’t you?

I’d casually estimate that 20-25% of the people in my circles on G+ haven’t posted anything yet beyond the bare minimum profile and maybe a test quip or two. Additionally, the vast majority of people who have posted regularly work in media, marketing or technology or are otherwise of your typical early adopter profile. This is fine, and niching in natural in a fragmented media environment, but it should cast a certain light on stats like “G+ could be larger than LinkedIn by next year”. G+ might give Twitter a run for its money – it’s currently appealing to the same market segment – but when I think of all the kinds of people I know on LinkedIn vs. G+, Google still has some distance to go before it has proven its appeal to the broader LinkedIn segment. (The utility of Google+ competing with LinkedIn is also highly suspect at this point.)

Outposting reminds me of the Oklahoma land run scene from the Tom Cruise film Far And Away
(I found the clip and inserted it below) where they rush out onto the frontier and jam a flag in a piece of land. In the film, it was literally a dash to stick a flag in a parcel of land surrounded by equally open, full-of-potential, land. As anyone who follows history knows, some of that land grew to become towns and eventually cities. Some became farmland. And some never became anything at all. It had something to do with the land itself, but more to do with what was being done on neighboring plots around any specific parcel.

That last part is important because the eventual settling and development of G+ will work in a similar way. What the settlers around us do with their piece will largely define if the piece we staked out will be useful and valuable to us.

I am guessing that behind Google+ rapid signup rate, there is a lot of outposting going on. Who wouldn’t take 10 minutes to claim their parcel of this brave new world? The question remains how many of these people will be true frontier settlers willing to pull up stakes and move their stuff from the comfort of Facebook or LinkedIn or wherever to the open frontier of G+.

Then again, maybe it won’t be an either/or but rather like having a summer cottage you visit occasionally. (I realize I am stretching the analogy here.) Many of us already have multiple accounts on multiple sites and visit each for different reasons. This is all well and good, but one place is always our primary residence and as anyone with summer property knows, maintenance of the place you don’t go to frequently can be difficult to keep consistently. And if maintenance drops the face of neighborhood starts to change. Timely updates are the fresh paint and manicuring of Internet land ownership. (Wow, I am beating this analogy to death aren’t I?)

It’s worthing pausing now to consider Twitter as there are some parallels. According to Edison Research, Twitter enjoys 92% awareness among Americans. This is not surprising given that the little blue bird appears on everything from T-shirts to billboards and on the vast majority of websites. However, despite this awareness, which is nearly equal to Facebook’s, regular users of Twitter represent just 11% of the population. A far cry from Facebook’s nearly half of our population.

Twitter’s rocketing growth made headlines just as G+ is today. Publishers spoke of ’100% growth rates’ etc. without detailing the circumstances surrounding those statistics. As it turns out, 22.5% of Twitter users publish 90% of tweets and only 21% of registered users are actually active on the site. (Think about that… 22.5% of 21% represent 90% of all Tweets. That’s the 80-20 rule on steroids.) So while a ’100% growth rate’ is a great stat for headlines, there’s a lot of outposting hidden in there as well as simple old-fashioned account abandonment and user atrophy.

Google+, at this point seems to be echoing Twitter’s general trajectory just as Foursquare did a few years ago. Admittedly, G+ probably has higher odds of pulling in more of the masses if only because more of the masses use Google tools and brand awareness and trust is very high. No one needs to learn what Google is or stands for. We all have our idea.

(Playing devil’s advocate though, even with 92% awareness, Twitter hasn’t demonstrated enough utility to enough people to enjoy higher usage.)

Lest I sound like a buzzkill, it’s worth noting here too that having 11% of the U.S. population active on your site (as Twitter does) is not shabby at all. In my opinion its not quite enough market share to warrant the lofty Wall St. valuations, but then again, Wall St. has had a bad week so I’ll be nice to them for now. Instead, 11% marketshare is sort of the equivalent of being one of the ‘big four’ networks of our time – though with Twitter that network is more akin to the Syfy channel and E! combining audience than a general household demographic. (Also, its worth stating here that the dynamics of social networking tools are so different from TV networks that the comparison and utility of being the equivalent of a ‘big four network’ basically ends with the simple quantitative similarity).

I guess my big point here is that I think we working in media, marketing and communications need to check ourselves against irrational exuberance associated with outposting. Outposting is a well-established phenomenon that drives great headline writing and creates really impressive growth charts in meetings. It is not, though, a guarantee of future returns.

Funny, that last sentence sounded like the disclaimer that shows up on financial statements. And finance, as witnessed by this week’s remarkable stock market plunge, is another category full of hyperbole and ‘surprising’ disappointments.

Interesting.

The Influence of Apps on Business Models

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Apps are curious things. Had you described them to someone a decade ago, folks working in technology would’ve wondered what you were talking about. Ten years ago operating systems were continuing to swell with features and hard drives were being increased to carry the increasing load. Apps turned all that on its head.These small, simple, focused little pieces of software have not only become big business, they’ve influenced the very nature of business models themselves.

As with so many things in the world, business models too seem to be losing their middle ground. On the one end are the familiar conglomerates like GE or mega firms like Samsung which have many businesses impacting numerous industries. On the other end, there seems to be a crop of small, focused business ideas that look a lot like apps conceptually. The middle ground seems to be in decline even as the very large companies get very larger and small businesses multiply like replicating cells.

In old-school marketing jargon, the small app-like businesses which this post concerns itself with would’ve been characterized as simply having focus. The benefits of focus in business have been stated before, and some time ago. Al Ries wrote a great book, aptly titled Focus, which made a case for, well, focusing your business. His book was aimed at the larger companies that often get tangled up in line extensions and diversification only to watch their leadership positions erode.

Today’s app-like businesses are a bit different. The ones that have struck me have had simple premises. Interestingly, their websites tend to be equally simple, taking on that blog-like feel that is so popular now. When these businesses are online, their interfaces are small and elegant in a way reminiscent of Google’s search engine. When they’re offline the concepts of these businesses are equally simple. Here are two I recently encountered.

MOJO Motors

This web-based business starts with a simple premise – find the lowest used car prices online. To do it, you use a Google-like simple interface. A few entry points later and you’re looking at local dealers with low prices. It’s remarkably simple in premise and practice. Compare MOJO Motors to the 10,000 lb. gorilla in the space, AutoTrader. If
MOJO is Google, AutoTrader is a bit more like Yahoo!. Lots of options and bits and buttons and hard to know where to start.

Jugglebox

Now this is a nice idea. If you live in a city, chances are you change residence multiple times at shorter intervals of time. Jugglebox lets you rent environmentally-friendly moving boxes temporarily. They deliver the boxes, you pack ‘em and move ‘em, then they pick them up. They’ve even organized their offering around the size of your apartment (by bedrooms). The interface of the site is literally 1-2-3 simple. The benefits are also clear – environmental responsibility, simplicity, no boxes to store or destroy after your move, and its cheaper than buying all those moving supplies.

Today I think we’re all getting more and more used to having 20, 50 or even more little apps that each meet a discreet set of needs from travel planning to calorie counting. More and more we’re moving away from large software suites. Businesses that can do the same have the benefit of being approachable and a little familiar right out of the gate. Sure, the app-business-model won’t work in call categories but its interesting to see the effect apps, the software, are having on the way we think about other things like business models.

Apps seem to embody a simplicity that our ever more complex world seems to make us yearn for. How might this sense of elegant simplicity be applied to complex businesses today?

If you know of other app-like businesses out there, let me know. I’d love to keep an eye on them.

People with low Klout are highly important.

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I recently joined Klout (I’m usually a few paces behind the real early adopters… intentionally) to see what it was all about. I entered my Facebook, Twitter, LinkedIn and this blog. I came back as a ‘specialist’ with a supposedly strong core network. That’s all well and good. The more interesting thing happened when I looked at my Facebook friends’ Klout scores. Overwhelmingly they are in the single digits. Klout gives these folks feel-good titles like ‘Explorer’ but the real title is ‘marginal participant’.

By way of context for why this is important, I go to some lengths to keep my Facebook network focused on real-life friends while LinkedIn and Twitter are more professionally bent. This is both in terms of the content I share through these channels and the friends/followers/connections I seek out. In this sense, my Facebook friend set crosses all walks of life and does not index heavy for tech/social/net types (unlike my Twitter account which is stuffed with them because of the nature of Twitter and the type of people attracted to it – you know who you are you self-promoters you!).

So while this exercise is a far cry from a scientific sampling, when my Facebook friends consistently come back with very low Klout scores, it does make me wonder if the divide between the tech/social/net types who build these various applications and tools and the average users they think might adopt them, isn’t more significant than sometimes assumed. To look at Klout’s site, online influence is something really important to measure. Influencers are certainly desirable to advertisers. Most people, though, probably don’t care about Klout or clout or being or knowing an influencer.

(I also question the very methodology used for measuring influence online, but that’s a whole other post.)

I’ve observed a similar gap with the pervasiveness of the iPad. Taking a commuter train into NYC, it seems about one in ten people now have iPads. However, when I was in Washington D.C. a few weeks ago, I saw only a handful as is often the case when I’m traveling elsewhere. I don’t question that people are buying them – the sales figures are what they are – but I think opinions of market growth based on observing people in the metro NYC area are somewhat skewed by that rather unique and novelty-obsessed niche.

In my opinion the one recent social media rising star that has most successfully made the leap out of the echo chamber  of the tech/social/net set and become a tool for everyone is Groupon. It’s worth noting here now that Groupon isn’t really about ‘connecting’ the way Klout, Facebook, Twitter, LinkedIn, Tumblr, Posterous, et. al. all circle around that word either enabling it or measuring it.

Groupon instead offers something useful that people want – savings. That’s interesting. It might be that the next wave of successful business influenced by social-technology won’t see the technology as the ends itself, but rather the means to offer something lots of people find useful. Like coupons.

Meanwhile the tech sector keeps cranking out new ways for us to connect online. My big question is, how dissatisfied are most people with what they already have? I know early adopters need a constant novelty fix, but I don’t get the sense my low-Klout Facebook friends have too many gripes with what they have. Sure, people will be curious and sign-up – there’s a low barrier to entry for these things – but will they stick around and use it? That’s the big question.

And now of course there’s the hullabaloo around Google+ to look into. Yup, yet another account. Right now, given that Google has said upfront that the invites went out to people with ‘strong social graphs’ I’m not surprised to find it full of my usual industry peers (nice to see you again at yet another URL folks!). The big question is, will those low-Klout friends of mine find it worth either moving camp from Facebook to Google+ or be willing to manage both sites? Either avenue is a lot of work. The big draw of Google+ is the ability to create overlapping friend sets for sharing. That may well be a useful app, but if it turns out to be valuable to average folks, can’t Facebook just replicate it? Technological advantage is very, very short lived these days. If I’ve already set up shop on Facebook, I can’t see pulling up stakes for that feature set alone. What, and wait for all my friends to join? And port over all those pictures and notes? And what about my Farmville (which while technies may despise it, is popular among many people)?

For me, the real test Google+ and others is whether my friends with the lousy Klout scores bother to not just sign up but to regularly participate – like they do on Facebook. Attracting social media fanboys is easy. We’re early adopters who are willing to tolerate having all these accounts and constantly switching from one technology to another.

The people with no Klout (and who, frankly, don’t care about having clout online) are the other 99%+ of the population that Facebook and Groupon continue to grab and largely satisfy as far as I can see. It’s these folks, characterized by low numbers of friends, low numbers of comments, low numbers of posts and low Klout scores, that set the high bar for being the next game-changing player in the space.

Groupon seems to get this. I’m not so sure some of the other ventures popping up do.