A deeper look
OpenSocial will probably have the least impact near term for marketers, as developers are the main beneficiaries. The ability to create an application once for multiple platforms is certainly an improvement, but one that will be relatively negligible to users' every day behavior.
While moving from one network to another is a convenience on an individual scale, people usually migrate in packs. And although the open platform of Facebook has paid great dividends that Google is trying to siphon away, widgets are a secondary driver of social networks' popularity. Facebook's growth was astronomical before the platform launched because of a much harder to emulate factor: trust.
It will be interesting to see how widgets evolve on Salesforce and LinkedIn, where throwing sheep and vampire battles will give way to hardcore productivity and networking applications.
Social networks have long concealed a dirty secret: Display ads usually have a much, much lower clickthrough rate than even the anemic response they generate on the rest of the web. And it's no surprise why: Activities on networks usually generate a ton of page views, and the content users are viewing is exponentially more relevant than a random display ad.
MySpace's Self-Service solution mines users' profile data and serves up ads based on their interests. In theory, this should produce a much higher response, as the ads are more meaningful than blanket-demo display advertising.
I say "in theory" because of the perceived low credibility of some of the profile information, and the noisy nature of typical MySpace pages that will make it hard for even the most personal branded messages to break through the clutter.
That said, a very intriguing application of the Self-Service tool resides in local advertising, as 98 percent of local advertising is placed offline -- and with good reason: It's tough to target local consumers efficiently on the web.
While AdWords made it easy for businesses of all sizes to connect with consumers who were looking for their services, it's not the best vehicle to drive local awareness. For example, although I might search for local Chinese restaurants, I have no idea that a fantastic Korean restaurant just opened, as it would not turn up in my results. The new service solves that issue in spades as businesses can now engage users during the consideration and pre-purchase phases. One can only imagine what competing nightclub profiles will look and sound like on MySpace, but it is a great opportunity for that type of business.
Like MySpace, Facebook is also using profile data to serve ads, but with a twist: Not only do actions within the network signal potential interest, actions outside the site can trigger ads as well. For instance, if I place the sixth, and penultimate season of "Magnum PI" on my wish list at a partner site and share my Selleck via Beacon, all of my friends see Magnum's obsession with short-shorts on the newsfeed. The double opt-out method should make accidental/unintended disclosures of my Higgins' fascination to a minimum.
User control of brand engagement is also the key to Pages, which allows brands and businesses to create Facebook profiles that enable users to become "fans." What makes this different than what Myspace has been doing for years? With Facebook, this has been tied to the Social Ads from the start (which is how the money is made), which will directly tie the reach of a campaign to how effective a profile has engaged users. Many early MySpace corporate profiles were novelties or mini-sites crammed into a page -- the creative limitations of corporate Facebook pages are actually a strength in that they will force marketers to focus on creating a two-way dialogue deeper than "OMG! Your product is SO GREAT! LOL!!!"
<< Previous page | Next page >>
