Why Facebook will NOT be “Yahooed”

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This is my second contribution to the innovation generation blogs, an initiative sponsored by Alcatel. Here is my second piece entitled: Facebook, The Good, Bad and Ugly.

No one knows exactly where the social network is going, but it’s certainly going somewhere. Last September, I organised the San Francisco blogger bus tour on behalf of Orange, a unique experience, in which 14 bloggers from all over the world roamed the Valley in search of evidence that innovation wasn’t stifled by Facebook and other social media giants, as some wanted us to believe.

Yet, all along our visits, we heard claims that “Facebook was passé” and even that “Facebook would be ‘Yahooed’.” Four months later, the news that we are getting about social media is so contradictory that it is very hard to tell what’s going to happen. Yet, marketers from all over the world have invested massively in Facebook.

[photo : antimuseum.com]

The question is, will it prove useless, or will Facebook on the contrary, be the result of a self-fulfilling prophecy? And why does it matter for service providers?

The good

Facebook’s footprint is humongous and there are nos signs of “Facebook fatigue”. So many have moaned that after the one billionth user, things would start to deteriorate. Well, it didn’t happen. Socialbakers’ numbers aren’t showing evidence of that. Even though the recurring purges of fake users trigger falls in numbers, penetration rates can still go up (with less than 50 percent of the UK population, and less than 40 percent in France, there is room for improvement).

When Timeline was implemented in 2012, it was heavily criticized and doomsayers predicted users would leave the platform. They didn’t, they just got used to it, that’s all.

The bad

Facebook and Instagram have a track record for playing tricks with data privacy on the back of users. Yet, despite the recent rumors about users leaving Instagram for this reason, the news has been denied by Facebook itself. Instagram, according to Mark Zuckerberg’s firm, is even gaining users.

Zuckerberg himself admitted that privacy doesn’t matter anymore. A belief which isn’t shared by all and especially in German-speaking countries, where culturally speaking, data ownership is crucial. Max Schrems even founded a group entitled Europeans versus Facebook, which is filing legal action against Facebook.

Regardless of the outcome of this lawsuit, there is something wrong with the way the world’s largest social network is considering its users. So much so that might one rightfully wonder, like Dalton Caldwell, whether this is what social media was supposed to be, whereas it was meant to “change the world” to use one of Mr Zuckerberg’s famous quotes.

And the ugly

Very recently, LinkedIn’s Mario Sundar pointed out the lack of style in the company’s PR. This isn’t conducive to believing that marketing has changed forever like Tara Hunt had predicted.

Besides, a few months ago, Facebook decided to tweak its secret Edge Rank algorithm so that fewer users in your communities are exposed to your messages. This is no big deal for users, but for brands, it means that they are now offered to pay for “promoted posts” to reach more users. Wait a minute; what if your average TV network was offering your business advertising space and was asking for more money so that viewers are actually presented with your message? You would naturally be angry.

Yet, with Facebook, nothing has happened. Do advertisers have any other credible alternative to Facebook? As I heard one of my counterparts say at a recent advertisers’ meeting: “I know all this stuff about Google+, but Facebook is where all the users are!”

The future

What does the future hold? I’m not certain social media sells soap; what is true though is that there are a lot of similarities with the period that we are going through and the early 2000’s. Back then, everyone argued there wasn’t a business model for the Web. Yet, more than 10 years later, European e-commerce is delivering nearly as much revenue than Telecommunications companies.

Similarly, those who said there wasn’t a business model for online advertising are those who praise Google Adwords now. Multinationals spend up to several dozens of millions of euros on search engine marketing (SEM), including service providers. This is no small business.

Social media and Facebook, in particular, are no different from those early web trailblazers. The world, and service providers in particular, should stop sneering at those shaky business models. Internet business is a self-fulfilling prophecy; it has always been the case. This is high tech innovation for you, no one knows for sure where it’s going, but it certainly is going somewhere.

As a consequence, there are chances that we might have to put up with Facebook’s freaky way of handling privacy for a lot longer; that is to say as long as brands are ready to pay for advertising on Facebook and experiment on the popular social network.

@lbret: “LinkedIn is adding 2 new users every second”

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[this post was originally written for the live.orange.com blog]

LinkedIn is aiming at keeping its users happy

In terms of Social Media, Facebook springs to mind with its 850 million users and growing every day. Yet, there is another social media behemoth which launched in 2003 and has only – even though only in this case is very relative – 136 million users worldwide and it’s LinkedIn. With nearly 140 million very high-end, affluent users, the business to business pure player has changed the recruitment industry for ever. Today at Le Web Paris 11, I had the opportunity to attend a workshop facilitated by Laurence Bret Stern, marketing director for the EMEA region at LinkedIn and what I liked most about their presentation is that – despite its staggering success, the company is sticking to its original mantra: “let’s keep our users happy”. And I have to admit I have been one of them since the inception of the service, and that I find it to be an invaluable business tool.

big and growing bigger …

LinkedIn has become a real social media phenomenon, worldwide and in Europe in particular. The proof of that is that the Netherlands is the country for which the penetration of LinkedIn is the highest. And it’s not finished. The increase in member uptake is staggering, namely in countries like France which are in catch-up mode.

Picture this, “LinkedIn is adding 2 new members every second” said Laurence in her opening pitch at Le Web this morning.

And it’s not just any kind of members but very high-end, affluent and influent people: Indeed, 15% of higher management functions execs who are managing more than €150k and managing 10 people or more are using LinkedIn and the B2B social media site is now getting “even more popular amongst such segments than well famed news websites like the FT or Le Figaro” Laurence added.

80% of LinkedIn users aren’t looking for jobs.

50% of LinkedIn revenues are made from selling services to recruiters (on how to find candidates) and advertisers . A vast majority (80% of users) of LinkedIn users aren’t looking for new jobs. This is a clear signal that they are getting business benefits from the service. LinkedIn premium subscriptions are reserved for expert users. For the above mentioned 80% users, LinkedIn is mostly a tool for doing business and working on one’s e-reputation.

Usage of LinkedIn on mobiles has rocketed up; an iPhone application has just been launched and is a success (a demo of the app is available here)

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[above picture: LinkedIn today, a new information curation feature by  LinkedIn]

establishing your company & employee identities

Company pages are free. Laurence added went on saying that “LinkedIn is a no brainer for companies which need to promote their brand and image”. It isn’t just a personal system, “if you are a business, you should make sure you are on LinkedIn” she added a bit cockily.

a search engine optimisation (SEO) beast

“30% of Google searches are carried out on people’s names” Laurence added and therefore, LinkedIn has become an “SEO machine” and enables employees – and therefore companies – to become more visible.

review of the main LinkedIn services

  • The free directory: The core of the LinkedIn experience is free access to the directory, and the mission statement of the company isn’t to make people pay upfront but to make them happy about the service (and then let them pay for extra services if they want to).
  • LinkedIn today: a b2b curation tool
    • LinkedIn today chooses your vertical and presents a list of articles based on what people with profiles similar to yours have looked at. It’s available at Linkedin.com/today and is very accurate
  • LinkedIn Groupsare a
    • Philips for instance is running a group on hospital lighting material, very specific and very successful.
  • Alumni: LinkedIn.com/classmates
    • using this new feature, you can see where your old classmates are working. This is working for university and college graduates
  • Stats about companies are made available from the company pages and all for free. This makes it possible for job seekers to prepare an interview for instance. Polls can be launched from company pages too in order to establish thought leadership around brands.
  • Talent acquisition: As seen above, most of LinkedIn’s revenue is coming from job search services sold to businesses. Recruitment ads are based on profiles. LinkedIn’s flagship product is called LinkedIn recruitment. In 2012, a new free service will be launched; it’s called “Talent Pipeline” and will be used by large companies which will build a pool of candidates and the novelty is that the pool in question will also include profiles from other services.

LinkedIn’s targeting very rich targeting capabilities are a fantastic asset and shows that social media has now become entirely mature, at least in business to business.