Facebook was once like a breath of fresh air because it was a space in which people could gather without intrusion from advertisers and others vying for our attention and dollars. Of course, that has changed as have our feelings about the co-mingling of social interactions and commerce. A study by market research company Lab42 found that 87% of Facebook users like brands – a statistic that hardly suggests anti-consumerism sentiments.
In fact, many Facebook users have positive attitudes toward businesses using Facebook for marketing purposes. Among the findings from the Lab42 study:
- 82% said Facebook is a good place to interact with brands
- 50% said that a brand’s Facebook page was more useful than the brand’s website
- 69% said they liked a brand on Facebook because of a friend liked the brand, too
If you are a business owner or marketer, you have to love these numbers! It is evident that brands not only can co-exist with Facebook users, but they can be a “friend” in their own right by interacting with fans and building relationships. Or can they? The sobering news from the Lab42 study was that only 35% of the persons who said Facebook was a good place to interact with brands believe that brands actually listen to them.
The remedy to this problem is simple and difficult at the same time. The simple remedy is “listen!” It is our nature to desire to feel valued by others, and being ignored is a sure-fire way to feel devalued. Brands should not establish a presence on Facebook or any other social network site unless it is prepared to commit resources to listen. Therein lies the difficulty of solving this problem. Who is going to listen? How much will it cost? What resources will be committed? How will performance be measured? These questions can be stumbling blocks to making a commitment to true engagement via social media.
People who like brands on Facebook show the love (or at least the like); it is up to marketers to reciprocate. Begin by listening to the people who are talking to you and about you.
Center for Media Research – “Like It or Leave It”
A year ago, the future of the location-based social network Foursquare was uncertain. It was not due to any missteps on its part. Rather, it was the announcement that Facebook was launching a location-based feature known as Facebook Places. The dominant player in social networking was moving into the check-in space? With a miniscule number of users compared to Facebook, the question that loomed was how could Foursquare possibly compete?
Fast forward one year- Foursquare appears to have survived the Facebook threat. Facebook announced this week that Places will no longer be a stand-alone feature on mobile devices. Places never got traction among users. My personal experience was that it rarely worked on my smartphone. Technical glitches notwithstanding, my inclination to check-in is to use Foursquare instead of Facebook. Although my network is significantly larger on Facebook, in my mind Foursquare is the brand for location-based social networking.
Why did Facebook Places not crush Foursquare? And, why is Facebook Deals, a social coupon service, not causing executives at Groupon to lose sleep? The answer to both questions is that while Facebook is ubiquitous and a valuable tool for keeping us connected with other people it cannot be all things to all people. It is another example of a classic branding mistake that experts like Al Ries often lament. As a brand grows, it is natural to seek growth opportunities. But, as brand extensions inch further away from the core offering consumers are not as accepting of the brand’s capabilities. Google has experienced a similar fate as many of its brand extensions have met with less than resounding success.
The Facebook Flaw is not unique; it is same song, another verse of the perils of brand extension. Define what is great about your brand and be the absolute best- differentiate and dominate. But, avoid the temptation to think that your greatness will transfer to products that may be beyond the core of what attracts customers to you in the first place.
Have a great weekend! I’m off to a full day of meetings, but first I am going to check-in… on Foursquare, of course.
MoBlog – “Facebook Kills Places – Is Deals Next?”
In my last post, the challenges of being late to market were discussed, with the demise of Microsoft’s Zune music player being the latest example of how failure to differentiate can doom a product. Now, another situation in which a well heeled brand is coming to market with a new product is examined; this time it is from the perspective of an entrenched competitor. Groupon is a social media success story, going from start-up to an estimated $3 billion in revenues in less than three years. In that time, Groupon has established itself as the dominant social couponing brand. Nothing will be able to derail Groupon given its position as the early-to-market king… right?
Should Groupon executives be losing sleep over Facebook’s push into the social couponing category? The social network giant is launching Facebook Deals, which resembles Groupon’s offering of discounts on local dining, services, and entertainment. Facebook Deals has been available in some foreign markets for several months, and it will debut in five U.S. cities soon (Atlanta, Austin, Dallas, San Diego, and San Francisco). With more than 500,000,000 users worldwide, Facebook is a ubiquitous distribution channel that holds appeal for businesses in markets large and small.
Facebook may be bigger than Groupon, but is it better? Market presence and success give a brand like Facebook an upper hand when introducing extensions but do not guarantee success. Other brands have struggled with breaking into new categories. For example, Google’s enormous market share in search and search engine advertising were not enough to make Google Buzz a viable product, nor has it exactly translated to success for its Chrome browser.
Facebook Deals may be a smash hit, but it will not be because Facebook has a large number of users. In order to be adopted, it will have to offer points of difference relative to Groupon. Are the deals more attractive? Are coupons easier to redeem? Is the interaction with retailers or service providers different in some way? Groupon can win the battle by being better; being first will be helpful but not as much as a providing a better experience for customers.
In the long run, being better will be more profitable than being first. To borrow an ad tag line from Nike, Groupon will have to show “My better is better than your better” when it comes to competing with Facebook or anyone else. If the customer experience is positive and enjoyable, almost any brand can compete.
I don’t have the resources to give away things to have people become my friends on Facebook. Papa John’s Pizza, on the other hand, will gladly give you a free pizza if you become its friend on the popular social networking site. Facebook users who become a Friend of Papa John’s will receive a coupon good for a free medium cheese purchase with the purchase of a medium pizza. You have to act fast, though. The offer expires December 1.
What’s the motive? Perhaps it is competition as Pizza Hut has unveiled a Facebook application that enables users to order from Pizza Hut online without ever leaving Facebook. Online sales are a rapidly growing channel for both Pizza Hut and Papa John’s. The Papa John’s offer focuses on the online channel as the coupon is good only for online ordering. Or, maybe Papa John’s is doing what Cnet blogger Justin Yu claims: “bulking up skinny nerds.”
In either case, marketing on social networks is another example of exploring ways to reach customers where they are. This outreach has to be balanced against coming across as being intrusive. Or, in the case of Papa John’s, some people might be insulted to think that Papa John’s is trying to buy its friendship with a medium pizza. I’m not insulted; I for one will enjoy my free cheese pizza!