Some thoughts on internet marketing and the challenge facing FaceBook and Twitter
Every once in a while I have to get back to the value that is yet to be proven for internet marketing. When I say yet to be proven I am thinking here of the promise to get beyond sub 0.5% conversion rates usually seen in traditional marketing. This is the promise that is held out for the Twitter and FaceBook models that somehow they have transcended the value which traditional interruptive marketing brings. (For my thoughts on Groupon)
Mathew Ingram writes a succinct summary of the problem on GigaOm:
Both are seeing their share of the ad market grow, but there is still one big question standing between them and the multibillion-dollar valuations they have received from investors — namely, do ads inserted into social activity actually work?
Brilliant. Everyone gets excited about volume of eyeballs, but that is old thinking. Mathew summarises the problem perfectly here. Will people actually buy things that somehow are selflessly promoted by their friends.
The bigger story is highlighted in this thoughtful piece from Brad Stone on Business Week. There are several anecdotes about GM, Ford and Newt Gingrich levering twitter in ways that reflect more on the troll like activity we used to see in 1990’s newsgroups, than in valuable sharing of valuable insight. There is nothing about product quality or why I should buy in.
Where do I see shared value? It lies in places where control is exercised by the owner and gaming is not possible. Amazon recommendations for example are (I believe) largely based on my own activity. That makes me more loyal to Amazon and more likely to use them, the more I see the value in the recommendations. There is another important point here; no-one can game what I do and buy.
A similar trend exists on Goodreads. I choose who I observe, and their book choices hold value for me when I associate with what I know about them and what they are reading. Again it is very hard to game because it would stand out if a thoughtful friend or person I know and respect who specialized in war history suddenly started buying bodice ripping romantic novels.
So there is another trend there; knowing the individual on the other end.
There are possibly three things that marketers could learn from these small observations over a period of time:
- My own behaviour is valuable to me
- The behaviours of real friends and of people I know and/ or respect are valuable. Their recommendation’s less so.
- I am highly distrustful of big media trying to interpret me based on my postal code or click preferences.
I don’t know if the book model I describe is extendible at scale but FaceBook at least has some of the pieces in place to be thinking about that. Twitter I have no hope for. Twitter is that yappy group in the corner, and while I might pick up on gossip from them, and even get a smile or two, it will not impact my purchasing habits.