An article in today’s Daily Telegraph in London (Networking site cashes in on friends) reports that Facebook has plans to monetise in a way that it has been unable to do to date. It’s not advertising or charging for premium services. Rather Facebook is going to get it’s money from a rather more prosaic source: the market research industry.
The social network is trialling features that would allow firms to survey its 150 million members to find out their thoughts on their product or market, get insight into their lives or test new concepts with them. In fact they could test just about anything they wanted. And given the fact that Facebook collects vast volumes of profiling information, they would allow this research to be targeted based on location, gender, age, and just about anything.
The company has been demonstrating the benefits of its new polling feature (called Egnagement Ads) over the last week to some of the most influential business leaders at the World Economic Forum in Davos. It asked a range of questions to Facebook members and were able to feed responses back to those at the Forum pretty much in real time. Engagement Ads are also being trialled at the moment by two firms: CareerBuilder, a global graduate recruitment firm, and AT&T.
As Randi Zuckerberg, Facebook’s global markets director, said to the Telegraph:
I had tonnes of people saying ‘this could be so incredible for our business’. It takes a very long time to do a focus group, and businesses often don’t have the luxury of time. I think they liked the instant responses.
We’ve written before on this blog about why Facebook really can’t be your online research community. Facebook, and indeed other social networks, isn’t suited to getting the depth of qualitative information that you can get from an online research community. As we wrote at the time:
It’s only in a research community that you can really make sure you get the most out of the discussions and debates [...] do you have right of response and an ability to enter into an equal discussion with other members [...] can you build and analyse the profiling data you get from the members and the vast backlog of their contributions and opinions [and] do you have a set of members who are their to engage and interact directly with the brand and there to support you
Perhaps what Engagement Ads more closely represents is a large online research panel. With firms able to buy questions and target a particular set of respondents based on their screening criteria. Even here, there are some concerns about Facebook. Panel providers spend a lot of time screening participants. They hold the same data on every participant and are therefore able to screen respondents fairly and comprehensively. The problem with Facebook is that it just does not collect data in the same way. As a member, I can opt what data I give them. I don’t have to tell them my age, my location or even my gender. So if somebody wanted to poll men aged 25-34 in London, England, Facebook might not approach me, even though I fulfill all those criteria. Respondents are therefore biased towards those who are willing to reveal this profiling data, rather than being a fair and random sample.
But of course, Facebook has a significant advantage. Size. With 150 million members, spread across the globe, it doesn’t matter if a proportion (even a large proportion) havent’ filled in their profiling information and so are excluded from the sample. There will be more than enough respondents available to get the responses they need. And to get them quickly.
So if Facebook is to use Engagement Ads as a market research tool then it won’t be tuning into an online research community. It won’t even compete fully with online panel providers. But it will offer something new to the market – a vast, rapid-response and (potentially) relatively cheap way of testing opinion and getting a flavour of what people think. For more depth of insight, however, firms are probably going to have to look to other sources.
Some more reading
- Facebook’s Monetization Plan? Polls. And Lots Of Them (mashable.com)
- Facebook offers up users as marketing tool (guardian.co.uk)
- Facebook begins testing ad-driven polls (venturebeat.com)
- Facebook Polls Bring Reality To Davos Elite (ajax-blog.com)
- Mark Zuckerberg, WEF, and the Sentiment Engine (allfacebook.com)
- Not in Davos? Get Your Opinion Heard, Via Facebook (mashable.com)
- Facebook (NOT) Rolling Out New Product Research Service (Updated) (allfacebook.com)
- Facebook is NO ‘Market Research tool’ ! Telegraph misinterprets FB (techpluto.com)
- Newsflash: Facebook Not “Cashing In On Friends” (ajax-blog.com)