Category Archives: Data Collection

Facebook’s frighteningly impressive ad potential

(Originally published in iMediaConnection, September 11, 2009) by Eric Picard

I’m pretty active on Facebook. I check my account at least once per day, and I frequently will fill downtime by reading through my friends’ status updates on my phone. I find Facebook to be a brilliant and incredibly useful tool. It has reconnected me with old friends, given me a closer relationship with relatives who live far away, and helped create a closer, more personal relationship with many of my professional colleagues. And the amount of data that Facebook stewards for me is both impressive and scary.

In 10 years, Facebook will know what an entire generation’s boyfriends, girlfriends, spouses, and children look like. It will not only have a map of the social graph and deeply understand the relationships between people across the world, but it will also know what things they like, what companies they’ve worked for, and, in many cases, minutiae of value to advertisers — such as what products they’ve owned.

And despite the relative quiet around what Facebook is doing in advertising, the network has created one of the most powerful and elegant advertising tools I’ve seen so far. For the past six months, I’ve been telling people in almost every advertising discussion I’ve had that they should go and create an ad on Facebook. The process is a revelation.

The buying process inherently involves targeting. Keyword targeting is only one method used — and not required. Ads can be targeted not only to geography and demographics, but also according to workplaces, relationship status, and even ads shown on people’s birthdays. The tool implicitly gives you an estimate of the audience size you could potentially reach. And as an advertiser, I can’t imagine a buying scenario where I’d trust the estimate more. In a city like Seattle, which has numerous technology companies, an advertiser could even build offers specifically to employees of specific technology companies.

Recently I saw an ad from a guy who was trying to find a job in marketing at Microsoft (I work at Microsoft). His ad had a picture of him, a brief background, and a goal for what kind of job he was looking for. And it linked to his profile. Now, I must admit that I had mixed feelings about this ad, but I was also impressed at his chutzpah and also by the simple fact that it was possible to do this.

Scott Tomlin is a colleague of mine who owns a comic book store here in Seattle called Comics Dungeon, and we’ve chatted repeatedly about the difficulty he has as a local small business owner with advertising online. This is despite the fact that he has worked as a software engineer on advertising platforms for the past six years, and knows quite a lot about advertising.

Unfortunately the lessons of national advertising don’t apply very well to his local small business. He’s tried all the “usual suspects” in traditional media, but has really pushed hard on the idea of advertising online, especially given his main career. And he has had a hard slog of it — with the exception of his efforts on Facebook.

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Scott’s main push with online advertising has been selling subscriptions to comic books, and while he’s a local business, customers of his subscription service are spread across the U.S. The main reason he focused here is that he can justify the relatively high acquisition costs for a subscription customer, rather than just driving in foot traffic. And his acquisition costs with online advertising have been high — especially via paid search.

As I mentioned, the one shining ray of hope he’s had is Facebook. With Facebook, he can target so incredibly well that he can get his ad in front of folks he could never reach using other methods. He walked me through some of the campaigns he’s running on Facebook right now, and the results were pretty impressive. With Facebook he’s been able to branch out beyond his subscription sales and effectively target local customers to bring traffic into his store. And with Facebook’s features for hosting events, he’s found a very powerful tool to bring potentially high value customers from around the region into his store.

Unlike a national advertiser, as a small business, it’s in Scott’s best interest to spend some time honing his campaign to address incredibly small micro-targeted audiences — audiences that would be too much work and too tiny for a big advertiser to bother with. He showed me one campaign he’s been running to promote an event at his store. With the five targeting parameters he’d assigned to the campaign, his estimated audience was only 620 people. But he had more than 40 clicks on this campaign and, at last check, had 24 people who had signed up to participate — using Facebook’s event promotion tools. It is this integration of incredibly rich targeting with tools specifically available for individuals, organizations, and companies that make Facebook so incredibly valuable from a small local businesses standpoint.

I first recognized this power when I happened to notice an ad for a local Vietnamese restaurant called Monsoon East on my Facebook homepage. I still don’t know if Facebook was somehow able to glean that I love Vietnamese food, or if the ad just targeted me as a local. But what really grabbed my attention was not the ad itself, but what happened when I clicked on it. The ad didn’t link me through to the restaurant’s website. It brought me to a group page for the restaurant. My first thought was, “Oh — smart — it’s providing a landing page for local advertisers so they don’t need a website.” But then I saw that Monsoon East did, in fact, have a website — and after a bit of clicking, I realized that the restaurant actually has one hell of a website. It’s elegant, beautifully designed, and a fantastic site for a local restaurant. At first I was baffled as to why Monsoon East didn’t link to its website, but I quickly realized that its group fan page is brilliant.

This was a fan page with concise, relevant information that told me about why I might like the place, and then the magical “bit at the end” — the members’ list and discussion board. Monsoon East currently has 109 members on its group page, mostly filled with young, good looking, active-lifestyle (judging by their profile pictures) people. Despite my cynical ad-pundit view of advertising, I thought, “This looks like the kind of place I might like.” Just that they had 109 members on their fan page made this restaurant much more legitimate to me (as a consumer). And that’s powerful.

So kudos to a savvy set of local entrepreneurs who are unleashing the power of social networking to promote their businesses. I think we all have something to learn from them.

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You! Appearing Soon in an Ad Near You

(Published originally in ClickZ, September 2008) by Eric Picard

It occurs to me that in 10 years, Facebook will know what every ex-girlfriend and ex-boyfriend of an entire generation looks like. They already know what millions of people’s children look like and obviously have numerous images of almost every person that uses its service.

I was talking with a friend the other day about the fact that people haven’t considered the ramifications of Moore’s law (define) on real-time image processing. With more powerful computers and the increases in processing power growing more significant in 10 years, many things we think of today as technically impossible or, at the very least, technically difficult will no longer be. Certainly this will impact technologies like targeting and analytics; it will also impact computer graphics. Looking across both of these worlds and their intersection, it’s easy to start predicting how this could come together.

It won’t be long before the kind of photo and video compositing done painstakingly by hand with lots of CPU horsepower today will be handled in real time on a consumer PC or even on servers in the cloud. This means advertising could be assembled in real time, too. Some companies have been doing this for a while. Visible World, for instance, has enabled creative shops to build template-driven ads that enable elements of the video to be swapped out based on targeting parameters. Near Mother’s Day, residents of an affluent neighborhood might see the expensive flower arrangement while residents of a working-class neighborhood see the inexpensive flower one.

But the kinds of things we’ll see in the next 10 years will make this seem amateurish and quaint. Imagine the following commercials:

  • A man stepping out of the new Lexus sedan catches your eye, as he seems somewhat familiar. As he crosses over to the trunk, winking at the attractive (and also somewhat-familiar looking) woman passing through the parking lot, you notice something. He looks an awful lot like you! He opens the trunk and hefts a set of golf clubs. The scene cuts to him beautifully teeing off into the sunrise. You really pay attention — because it’s almost as if someone had peered into your dreams and put them on the television. And you appear in the commercial as an idealized, slightly more chiseled, rugged, and handsome version of yourself.
  • A woman who looks oddly like your wife is getting three kids roughly the age, size, and look of your own kids into a minivan that matches the criteria of cars you’ve been shopping for just this week. The eight-year-old boy is carrying a soccer ball — just as your son would be. The toddler even carries a stuffed animal that resembles the one your daughter carries with her everywhere! You see the kids calmly watching a movie on the installed screens, and they seem quite comfortable. The mom seems calm, relieved to have such a nice ride that all the kids enjoy getting into — without squabbling.
  • An oddly appealing woman is fly-fishing. She seems so familiar, like you know her from somewhere. The ad focuses in on the graphite rod she’s using, just like the one you were shopping for online last week but didn’t buy. You keep watching because the woman in the ad has such a nostalgic appeal to you. It’s almost as if she were a combination of three women you dated in college. And in truth, she is.

All these commercial seem like science fiction but aren’t far-fetched at all. We think about profile-based targeting as dealing with our habits and anonymously delivering products we’re interested in. But there’s no reason that down the road technology won’t enable the situations I just described. And while the privacy implications are vast — and the ads may seem a bit creepy — over time they may become acceptable. As we’ve seen in numerous studies, the current younger generation has very different feelings about privacy than older generations. And opting in to scenarios like I described may be quite commonplace in 10 years.