Today it seems that having a Facebook page is the height of cool. It is not. First a little trek down memory lane.
15 years ago having an email address was the height of cool.
10 years ago having a website was the height of cool.
5 years ago having a blog was the height of cool.
With each iteration the number of participants has increased by orders of magnitude making your coolness less valuable and harder to find. With each new communication channel(email, website, blog) companies and advertisers want you to buy their stuff. As the population has grown and the internet has supplanted print, radio, and television in delivering raw numbers of prospects, or suckers depending on your viewpoint, Advertisers have and are betting big on getting you to ‘Yes’ from email,banner ads,websites and now Facebook pages. Using other peoples money to make a living selling you shit is as old as the first print advertisement. This is not a new business model. The FB mission is to deliver eyeballs to advertisers in exchange for money.
Facebook membership is a suckers bet. Here is a piece of poker player wisdom; ”If you look around the table and can’t spot the sucker, than you are the sucker.” If you are under the illusion that Facebook is about sharing and caring about you, I would like the opportunity to offer you either a piece of the London Bridge or a square inch of the Moon.
Facebook is arguably the current darling of the internet with a ‘reported’ 900 million users, whose sole function is to encourage members to provide information by ‘sharing’ yourself with others for the marketing machine that is Facebook. This is not a new business model. However with web beacons, third party advertising companies and Facebook’s ‘like’ buttons infecting the web,(Imagine being an alcoholic and going to the local mall and every store is a bar or liquor store.) data mining, collection and data sales has gone into overdrive.
Facebook has become the internet’s Digital Plantation and its members are all sharecroppers slaving in the digital fields living in the company town, buying ‘cred’ from the Plantation owner, and in the big house there is a giant party as the ‘bosses’ buy and sell attention data, your data.
I mentioned before that this is not a new business model, but a 21st century feedlot(fattening the cattle before sale and slaughter) that has attracted the attention of advertisers and companies in a big way.
In October 2007 was this quote in a Wired Article
“The key thing is that Facebook has an audience,” says Forrester analyst Charlene Li. “Wherever audiences go and people spend time, that becomes an advertising medium.”
The buzz and revenue being earned by Facebook has led to the upcoming stock sale to the public. If you have a few bucks and want to double your money… fold your money in half and put it back into your pocket. Institutional traders and program traders will be snapping it up and bouncing it around for days.
As I mentioned earlier Facebook is generating revenue by selling advertising and data to companies who have been sucked into the Social Media Kool Aid. On the back of a matchbook, the ability to reach up to 900 million ‘customers’ would seem to be a great bet. Since you can sell almost anything on the web from abacuses to zebras. Almost.
If you consider 1/2 of 1% of ads actually get clicked, and you have a pool of fish even around 450 million would give you about 4.5 million leads to turn into sales, it might be a good deal if you are selling stuff folks need. But need is the last item on the list of advertising objectives.
GM’s Drive By Shooting
However GM, the largest auto manfacturer in the US is pulling out of Facebook. Holy Crap Batman! Somebody in ad land figured out that trying to sell cars used to drive to destinations to folks who are sitting down at a screen or even on a mobile phone is just about the dumbest way to spend money advertising a product that requires you to use your head as an active participant where your tablet, monitor, or mobile phone will get you seriously hurt if you try to multitask.
Once more folks figure this stuff out, ad revenue will plummet, people will demand more accountability from these networks, and the death spiral of irrelevance will suck Facebook into another What Happened to…. article on the back side of the web.