A lot of articles and scientific studies have emerging explaining why facebook will lose 80% of its users in 2/3 years time. There’s just a few (additional) points that make this highly unlikely…
1. Personal data
Probably the key thing in all of facebook’s activity, facebook connect – sign in with facebook. This is the ultimate weapon in mapping the users of the internet.
Because google has a huge breadth of websites that cover almost 100% of your needs on a laptop, they enjoyed a fantastic edge that was very difficult to top. But Steve Jobs changed that when he launched the iPhone and gave birth to the biggest information revolution of humanity, the ultimate sensor, the smartphone.
It makes you realise that you no longer need to listen to those market surveys that tell you an insight with 99.5% degree of certainty based on a 0.5% sample of the target group – a bit of a paradox, right?
Phones have become the ultimate sensor and not only to map movements of groups of people, but also to understand their behaviour. And again, not only in the digital world but how the digital experience fits into your day to day. And why is facebook now comparable to Smaug? They’re sitting in a huge pile of gold – or data!
“sign that T&C’s and i’ll let you walk out…”
This is the data that allows them to juice up their media business and add context to profiling. Programmatic media buying can now create programmatic marketing campaigns that can be automatically applied depending on your profile, your preferences, your affinity, where you are, what you are doing, and even better, how far down the chain of value are you!
Example:
You can target a campaign that sell Skiing material to all people that like sky resorts, are into sports and like sky brands, and they can sell it to a brand that knows they buy it in December, but if they buy it at the resort or back in their hometown, they will be lured by different messages – get a discount vs try for free on the slopes – and another different one when they are in the vicinity of a winter sports store, or if they are at an airport terminal waiting for their flight.
It’s not all about tracking and abusing – this is ensuring you ONLY get relevant ads. It’s good for you, and it’s good for brands – and it’s good to whomever holds the data required to put something like this together – Facebook, Google, Amazon, Apple, Samsung.
Surprised to see Samsung? What do you think applications like HTC sense, and Facebook home do? But if you look at google’s OS Android, they own 80% of the Mobile OS market – and yes, they are also sitting on a big pile of data.
Transparency = Trust
The big difference is in privacy policy and the fact there is no T&C for the Android OS with an explicit clause that let’s users know they’re giving away their data – and even worse (for Google) they are not giving anything in return. So difficult to justify a mass-market business because there’s no transparency in the how they are collecting the data.
Why do you sign up to Gmail – to get free e-mail. Why do you sign in with facebook connect – to get personalisation and absence of effort to create yet another user profile.
How would google be able to justify the existence of a “Batman cellphone sonar“ tech-like platform – exactly what the NSA seem to have built. And just to be clear, Facebook are no saints – and they’re paying for it, class-action lawsuit by class-action lawsuit!
The crossroads for Facebook is the one of a super-hero: “with great power comes great responsibility”.
Look out for the Personal Data Store solutions to come – passbook is the first baby step, but it’s a step by one of the big players in the mobile space. The truth is you need to store and manage all that personal information. The question is: who do you trust?
2. Mobile App Marketing
You have got to accept that facebook has learned from their zynga-mistakes, and learned from the genious of apple – build the market and let others monetise it. Apple’s iTunes represents only a 1% of the costs and brings in 10% of the revenues – now that’s productivity!
The move in mobile marketing is an amazing one. With the increased easiness a user has in purchasing apps, and taking into account that 60% of all your personal internet use is on a smart phone, what better market can you create? With brands realising mobile’s critical role in buying their products, they must find a way to be there – either via content, via mCommerce or via…you guessed it…apps!
Businesses that had no contact with end consumers now have direct channels (think FMCG), and can even become the lead generators – who knows if they might even stop being in B&M stores in the future…maybe they’ll just be in amazon and ebay, and those stores might be in facebook! If you look at the advertising investment, it’s clear where it’s going – mobile! So Zuckerberg made a great move in rebooting facebook to become a mobile media company.
Gaming – the early adopters
King.com’s Candy Crush Saga
The first big market is gaming – it’s just too big to resist it, and there’s already a few mobile marketing companies (applift, fiksu, kochava) that are exploring the one key differentiator in digital media – measurability. It’s not about vanity metrics anymore – its about ROI and LTV and really understanding what acquisition channel works for that target audience (attribution analysis), for this game and in these circumstances.
Imagine doing a business plan that combines this knowledge with understanding the trends of what kind of product you know people are going to be looking for. Your bets get safer and bigger.
So with Quarterly revenues from mobile advertising soaring at almost 2.6Bn in Q4 2013, and growing at an estimated YoY of 23%, it sounds to me like the market needs a way to make their apps visible – exponential growth in the number of apps on (Apple) app store – with the only big question mark being the emerging android stores in China and Asia in general, and how that tendency is going to move west.
Mobile Marketing Landscape in Venturebeat
Now the beauty of all of it is facebook doesn’t need you to increase your usage or engagement in the social network per se, the content and actions are almost machine to machine interactions based on your activity in other apps – but they still deliver that data, and you will always need to message or share photos or buy clothing on your mobile.
Big Data and AI first mainstream visionaries
I was watching War Games this weekend and there was a really cool line when the WOPR (war operations plan response – big data + AI computer that analyses and calculates war scenario outcomes) decides to phone the main character and the military chief says: “machines don’t call people!” They do kind sir, they do. And soon they’ll call (text, whatsapp or Facebook message you with the right information, when you need it, in a way you can fully understand it and probably with a promotional offer tailored to you! It’s not all roses for Facebook, and they can have competition, but it’s going to take time, and with enough of it, new ecosystems will emerge, like the connected cars, the smart home and the wearable tech. I’ll leave that for another post.
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