(UPDATED 5/17/12 DUE TO SUDDEN FLASH ON NEWS FOR FACEBOOK, INCLUDING GOING IPO, AND NEGATIVE REPORTS IN THE MAINSTREAM NEWS ABOUT FACEBOOK BUSINESS MODEL)
We’ve all had our concerns about Facebook and other social networking sites. This is based on watching them evolve, and how our privacy is being invaded and sold, without it actually “looking” like it is. The growing impression in the last few years, coming to a head now that Facebook is going IPO, is that – you can be paranoid.
Facebook IS stealing your privacy, and the media encourages the promotion of Facebook (and Twitter) as online mediums “for positive change and salvation”, in a sense. This is based on several Mid-East countries supposedly overthrowing dictators or rulers who were abusing their citizens because the “revolution for democracy” was enabled by Facebook. One major news source actually showed a video clip of the Egyptian “revolution” that consisted of several people running by the camera holding up a 20 foot banner with one word on it: FACEBOOK.COM. The news story on television seemingly tried to sell the unbelievable accomplishment of a social networking site as being the reason why Egypt got rid of their dictator. What a coup! (For Facebook).
However, the more frightening redirection of that logic is this: If the “revolutionaries” used their Facebook account to inform their friends and co-revolutionaries of where to be, what to do, and posted pictures and other information to accomplish the “overthrow of the current government”, that information is now owned by Facebook. So tens of thousands of “rebels” in Egypt have their information logged into the company with the largest compilation of personal data in the world. Facebook.com.
Will Facebook protect the information of these “rebels”? What if the same thing happened in America? Will Facebook users information be protected by probing “counter-attacks” by potentially favorable dictators/despots who know how to manipulate friendships with the corporate interests of the U.S.? Or will Facebook accept advertising requests from governments interested in their citizen’s political interests?
Who knows? But I do embrace this singular truth: “Power corrupts, and absolute power corrupts absolutely.” (English Prime Minister, William Pitt The Elder, the Earl of Chatham, 1770.)
Facebook’s lure of easy communication with friends, family, and the world has built it into a singular source of almost 1 billion humans today. At least a percentage of them have read or worried about the placing of personal information into the hands of Facebook, and forgave the company for its trickery, slow re-visiting of disliked invasive features and clandestine rebuilding of those same privacy invading features to be introduced in a more “acceptable way”. Serious Facebook users have an addiction to sharing their lives among all their friends, and even “faux friends”, to somehow satisfy their desire to confirm their “acceptance” and popularity. I know, because that was my feeling when I opened my Facebook account four years ago.
I put over 300 photos, with details, tags, locations, emotions, and more into my Facebook account. It wasn’t until I went to post a comment on a Newsweek article when Newsweek’s website instantly displayed my account profile photo (my wife and me) in my comment field, and asked if I would like to “use my Facebook account to register and comment.” I was shocked. I never gave Newsweek my information, and when you want to make an anonymous comment, your IP address and personal photo being displayed kind of nips the anonymity in the butt. (that’s another story – why companies using Disqus and other “social networking” sites to “instantly register” to make a comment is actually backfiring, preventing websites from getting thousands of comments because of the lack of privacy. A popular domain blogger just announced he has stopped using Disqus as a requirement to post a comment on his site. Simply put – nobody posted comments anymore.)
However, this article isn’t about the sad addiction of Facebook users. It’s about the false impression marketing professionals have bought into “social media” advertising. This article is an opinion regarding how stupid major companies are by thinking social media as being the golden path to follow, and thinking as advertisers paying Facebook, that Facebook will give them the data that Facebook already controls. The monkey spit of what’s happening on Facebook with advertisers is: The path of social media isn’t supposed to be the path that diminishes the company’s brand.
There are thousands of stories from users, developers, internet gurus, privacy advocates, and even marketing professionals regarding how dangerous Facebook and other social networks like MyLife.com, MySpace.com and many others, can be. Check out this story about how social networks assist hackers to get easy access to your personal info.
The Domain Industry really has one path to take to gain the best profits on their investments. That is communicating directly with End Users (I like to capitalize that term!) for your domains. It won’t come from other domainers trying to pick off your domains for cheap, or even parking traffic, although the latter can generate income if you have the right domain, it obviously isn’t going to be top of the revenue path.
Domain investors need to be concerned that their potential domain name sales are being replaced by Facebook account backlinks, which are actually being promoted on national television and magazine ads. Think about it: Facebook charges a lot of money for these companies to come in with their own advertising account, and allows any advertising company to have “open season” on every sucker who “likes” (clicking the infamous “thumbs up” icon) the advertisers’ Facebook site, based on their commercials.
The rat in the pudding most Facebook users don’t understand, or maybe don’t care about is this: Facebook is releasing everything you had set as “private” to the advertisers who you just “liked”. Why? Because privacy for your records only applies among Facebook users, not those companies who you end up “liking” or connecting to because you want to be informed of their newest prodservs. In essence, when you click on a company’s Facebook link and “like” them, all your private information will be released to that company. Facebook can actually hone down their advertisers’ searches to a particular type of demographic, and you can imagine the thousands of separate niche categories Facebook has compiled.
As the facts of this “advertiser intrusion” leaks out and becomes well-known amongst Facebook users, will there be a backlash against those companies that tricked them to “join” or “like” them, just to have that company/advertiser be able to collect your likes, dislikes, photos, school contacts, business contacts, friends, family, and other ridiculous information you put up on Facebook? I think once people realize that when they respond to the commercials asking people to visit Facebook sites and sign up or “like” them, that their private info no longer applies , they will be very very angry.
Already, major corporations are starting to think twice about advertising with Facebook, although the above “concerns” aren’t what is pulling them away from Facebook. There seems to be other facts that are surfacing in the marketing space that are making advertisers hesitate using Facebook. According to a new AP/CNBC poll, over 50 percent of Facebook users believe that Facebook is a “passing fad”. Reports vary , but at least 44% of Facebook users do not click on ads in their Facebook account. Ouch.
Beyond that, let’s just discuss the stupidity, and moronic decisions, made by some ad agency or company marketing director to include FACEBOOK.COM in their national TV commercials, actually placing Facebook’s domain name (brand) in front of their own! I’ve attached more than a few photos of TV commercials where well-known brands end their commercials with a request for people to contact them through the advertiser’s Facebook account. Think about it. The advertiser pays Facebook for the data collection rights (and Facebook does their typical toady two-step telling their users they’ll “never sell their private data”, but says indistinctly that they don’t “control third party privacy usage” if you click on their ads.
I would like to hear from at least one advertising VP who will state, on the record, that placing another company’s website or name in front of their own, in a paid advertisement, is a smart move, and is actually working for them. Please, let Successclick.com hear from ONE marketing expert who thinks that the “benefits” of Facebook information trumps the “backseat promotion” of their company behind Facebook. Please, someone stand up for Facebook or any of these idiotic ad directors who allowed the following TV ads to be placed nationwide. Or, agree that each should be fired for being this lame to allow the following ads to appear:
The facts regarding advertising are simple: Your brand, your brand, your brand.
Stupid advertising techniques and “branding” mistakes have happened thousands of times, but now they are happening in huge groups of Dumb. Now all these companies are completely dependent on Facebook to continue their “relationship” with their consumers. What’s wrong with the company forming their own “social network page”? A forum? A simple “share your story and photos here” page? “Login and have fun!” That’s not possible anywhere but at Facebook or Myspace or 100 other completely ridiculous privacy invading wannabee social network websites?
(Speaking of MySpace, anybody remember them and how huge they were?)
- Which brand name consistently makes its name seen and recognized instantly in these commercials? Where are people going to go as directed by the commercials? Most importantly, what company controls all the data given by consumers who choose to click on an advertiser’s Facebook powered commercial?
- Any marketing director, VP of Marketing, VP of Advertising, Advertising Executive, and most of all, the ad agency itself, that recommends and directs their client to use Facebook for consumer interaction and data collection, sells out their own brand for Facebook’s brand (on their client’s dime) and then controls and maintains all the data for the company, SHOULD BE FIRED. IMMEDIATELY.
- About a week ago, a popular domain blogger wrote about how uneducated real estate companies and agents were about the power of geo-domains. His article stated that real estate businesses were the “worst” at understanding the advantages of owning geo domains representing their area of marketing. Most domain investors have seen this lack of understanding from real estate professionals, and most agree. So it’s no surprise that Real Estate Contacts, Inc., just sent out a news release discussing their choice of Facebook for “Social Media Marketing Expansion“. If you’re a domain investor with experience, that news release endorsement by a real estate company should spell out how “smart” it is to use Facebook as your source of business promotion.
- As of this time: 7:20 AM PST, just 40 minutes from the IPO offering, Marketwatch expert makes a call on Facebook compared to Google stocks. Keep your money in your pocket.
- Most Moronic Advertising “Scheme” Ever Perpetrated On Businesses.
Well writtern and excellent article, i have been saying exactly this for a while only in a more ranty and less articulate way.
written!
Valid points you have raised. I’ve also noticed this trend with companies and I don’t support the idea of using facebook at all.
Great post Stephen. It’s unbelievable how many companies spend money promoting a facebook url over their own url.
FB sounds like FB(I).
Conspiracy would say FB is totally government project for total control of everyone!
True or False?
Or maybe S C A R Y!?’
Strange ,about 1/2 hr before I received this article I noticed that one of Co’s enquiring about domain already has a Facebook page and I wonder how that will effect the sale price ?. I have noticed more and more Co’s are getting Facebook even before .com . Bad news really, along with all other new tld’s as these Dumb people do not realise all the business they are losing not using .com How to you explain this to a dumbo, you cant ?.
Great article. I can only only picture the remnants of companies that may have tried to tie their brands in with MySpace or other earlier social marketing portals. You nailed it big time. You never want to have your primary branding and marketing efforts tied to another company in that way. While I don’t see facebook going anywhere for a while, I think it will be a different landscape once they’ve got greedy investors who have overpaid for the IPO looking for big returns. It won’t take much to alienate the user base by over marketing or just plain overlooking their needs to privacy on some level.
While I don’t necessarily think the AD guys should be canned, they should definitely be taken down a peg or two for being short sighted in their branding. While they might not get the same “User base” as facebooking their URL in their ad, if they designed their own unique special offer to draw their customers to their site directly they would probably be doing better in the long run and not erode their brand.
@Brad – Thanks for the nice compliment, Brad. Your answer makes perfect sense, too. I can’t make a prediction about the Facebook IPO success, because –ummm I remember when investing in mutual funds was a “safe bet” before the GW Bush era. I definitely think the ad execs who put their company into this Facebook “tie-in” should be demoted, or basically replaced in some way.
Great post! Please, everyone spread this message far a wide. Not to help the dumb ass Corp wienies who should know better, but for the poor little guys who are following their lead and are trashing their limited advertising dollars by not promoting themselves and ONLY themselves in their ad buys!
@Kurt
Thanks for the compliment. It’s obvious by now that those who know advertising, know that allowing your ad contacts, conversions, data, etc gathered from your marketing efforts should NOT be controlled by another company, especially one like Facebook, which is extremely polarizing, and eventually will succumb to some other system with less intrusion and chicanery regarding your privacy.. Thanks for writing.
I totally agree with your article. However I would like to suggest another reason for why companies might do this, namely, could Facebook be paying some of the larger companies to use only their Facebook page URL in ads?
@Gypsum – I don’t think Facebook has to pay anyone to use their name on commercials. I think the advertiser pays Facebook lots of money to “allow” them to use Facebook on their commercials. That’s the point!
Advertising a facebook page makes about as much sense as using a yourcompany@aol.com e mail address when you could be using info@yourcompany.com
@Joe Ray — excellent and simply-stated point about a complex issue (marketing).
Working for a relatively large company in domains I can say I’ve heard marketing folk talking about advertising their facebook page, they’re the same people burning through $30-40 million to get 50k fans on their facebook page.
Another concept coming through is “we have go to where our customers are” so expect walmart/nike to start chasing you down the street asking if you want to talk.
The social marketeers are having their time in the spotlight, much like the SEO consultants from a couple years back and the .com bubble machines of the 90s
@Tabasco — nice point about the amount of money advertisers spend to get 50k eyeballs onto a Facebook page.
@admin That’s even more insane then! Paying to use another company’s brand domain name whilst at the same time excluding their own company brand domain name from the ad. What strange logic!
Second great article you’ve done on the subject.
People are dumb. They buy into hype and invest in things they don’t understand. They just think boy if I got in on Google or Apple at 38 dollars wow and this is MY time like Robert Cline and others argues that .com is over that was Frank Schilling’s time- I’ll just register what he has in Mobi and make millions. I knew MOBI was DOA because I worked on what is now known as the iPhone for the real innovators whose patented components make it special.
The difference is that Apple and google make products that serve people. A telephone and a search engine are essential life tools. With Facebook we serve them. Their product is the value WE create and the eyeballs and data mining they salvage over. But like GeoCities and mySpace before it as soon as the next thing comes along they are dead. What a joke they will sell advertising- right now everything posted like on FB is advertising for someone else. I am sharing this post- I am sending you traffic and not paying anything. This happens 1000 times a nanosecond.
Just because I posted Donna Summer mix tributes today doesn’t mean they shove an ad in my face for Donna Summer and i’m going to run and buy her music. No there are 100 links to Podomatic and YouTube where I can hear something better and not available in stores- a creative DJ mix of all the tunes as an experience. Google is serving ads on YouTube to people Facebook send. So too with the NY Times and everyone else referred from Facebook. They are making money on Ads- for others!
Plus ads on the web don’t work other then to reinforce staying power, look financially strong (if they can afford ads, they must be big) or comfort investors they are real deals. But a true ad is something that stops you and creates desire and demand you didn’t wake up in the morning with. super bowl ad or a billboard in Times Square or on the Turnpike. Honestly, when has anyone reading this ever paid attention to ads on Google or Facebook? On my space I remember Elliot Spitzers whore making a million dollars in a few hours on downloads of a song, while Rupert Murdock served Google ads and paid them for the privilege. Wow don’t you think Fox has TV shows and movies to make you watch trailers for before sending business to their squatters? Couldn’t they run a talent search for American idol or a contest to have dinner with the cast of 24 like Obama raised $15 million for a 3 chance to sit next to him and Clooney. Jobs makes a billion a year just from tricking traffic away from the address bar into the search bar. Facebook way have they made. The next hot thing comes along and they are toast.
Because as Rick Schwartz wrote so eloquently about on eRealEstate.com in 2000- the lesson of the bust was eyeballs versus platforms. You can’t give something way for FREE and have anyone value its worth. People paid $38 per share but they wouldn’t pay $10 a year subscription- Go figure. And most have and never will use it like the pension funds Morgan Stanley robbed of $2 billion dollars by their investment in FB.
Ad agencies will sell it because they make money creating the campaigns that surround it. Domains are competition and deplete a share of the wallet they won’t ever want to part with.
Ok.. I’m ranting but you get the point. Remember people who think you are wrong are never proven right. Insanity thinking they will keep making the same mistakes and blaming it on someone or something else.
@Owen,
Thanks Owen for your detailed opinion on this subject matter regarding Facebook. Very informative and helpful to readers.
@Owen
In your 3rd to last paragraph, you wrote “…Rick Schwartz wrote so eloquently…”. Who is this “Rick Schwartz” guy who writes “eloquently?” It’s obviously not the person of the same name in our industry who writes every article attacking some domainer/s for not being as successful as he has been… is it?
J/K — Rick is loved by all and returns that love in every one of his blog posts… just read them. We all “understand” Rick, if this is the same guy you’re referring to.
I was referring to this Rick Schwartz piece:
http://erealestate.com/impressions.htm
Good article on the Beeb…
http://www.bbc.co.uk/news/technology-18142566
The trouble is stupid companies/people are, of course ,stupid ,and you cannot tell stupid anything. Try and explain to that stupid Facebook using company why they should buy your .com domain instead of sticking to their Facebook page and they will look at you as if you are the stupid one. The problem also is that they do not know what they are missing and wont take the chance to find out.