Who Will Be the Next Big Digital Analytics Tool? Hint: Some People Might Not "Like" It
By Chris Kerns | 2 Comments | Posted in | Permalink
I'm just back from the eMetrics conference in San Jose and, as usual, my head has been filled with new ideas, possibilities, and exciting directions for the Web analytics industry. There were some great sessions on digital measurement, but the one that caught my eye was the Omniture presentation highlighting its Facebook advertising integration capabilities.
Facebook has dominated headlines recently, getting attention for both positive and negative opinion on their recent announcements. The web analytics industry is responding with partnership announcements and integration plans. Webtrends has a Facebook offering as well, and it makes sense that it and other big analytics tools are lining up to help provide customers insights on the next big thing.
I started wondering: "Who will Facebook partner with next to leverage the great data goldmine it's sitting on?"
I quickly realized the real question is: "When will Facebook stop partnering and just become the next big analytics tool?"
So Let’s Talk About Facebook
Facebook represented one quarter of all Web page views as of fall 2009. One quarter. The site is pushing the boundaries of technology (and, of course, privacy), all the while bringing along a dedicated user base that can't help but check on their own personal news feed three, four, five times a day.
Facebook’s recent announcements show that they are thinking even bigger than their current footprint. With their new Open Graph and Social Plug-Ins, it’s easy to incorporate Facebook functionality on pages across the Web. Facebook is not only empowering developers to easily place their code on other sites, they are also promising value for doing so. Now when you visit Levis.com and check out a new shirt, you can see how many of your friends “like” that product. Brands think it will encourage more sharing, more purchases, and more dollars, and they are rushing to add the Facebook widgets to their sites.
The combination of those two factors - ease of implementation with a solid value proposition - has the potential to take Facebook's presence from one domain to...everywhere.
The Facebook Analytics Opportunity
If you stop checking your news feed for a minute, it's easy to see the huge data opportunity Facebook is creating. Obviously there is great value in the incredible data on Facebook’s own traffic –behavior, sentiment, relationship, social graph, and fan page traffic that all happens within Facebook.com—but the opportunity is now much bigger.
As these Social Plug-Ins gain wide adoption, those widgets can potentially send data about site traffic from across the internet back to Facebook. That’s right - these widgets can easily become the next generation of analytics tags. There's no reason that Facebook’s code can't count visits, visitors, time spent on site, etc. In fact some early press reports show Facebook already starting to report this data.
Put all this together and then things start to get very interesting.
When we look a few months into the future, we can see a landscape where Facebook not only has widgets on your site, but everywhere. Your competition’s site. Other verticals. Press outlets, blogger posts, and forums. The scope can exceed the “page” metaphor as well - Facebook Open Graph allows tagging of videos or products or brands or anything you identify as an "object." And if rumors serve correctly, Facebook will soon have location check-in information for physical locations of your business. Facebook can slice all this data with it's exclusive access to "like" data, sentiment from conversations about your company and products.
Put this all together, and you get something we've never seen before. Facebook's analytics would have the ability not only to report on behavior across the Internet, but to target users based on browsing behavior on any site, likes, sentiment, conversations, demographics, relationship status, location, favorite sports team, and what you say you might want to have for dinner tonight. The first true semantic analytics tool for marketers.
Imagine Google Analytics, Radian6, ComScore, Foursquare, and ForeSee all in one tool. And perhaps most importantly, it all lives inside a platform where brands are encouraged to communicate and interact with their customers, and vice versa.
As a marketer, what would you pay to get access to that data and toolset? What would it cost you if your competition had access, and you didn't?
I Don't Believe It. Dislike.
There are, of course, plenty of arguments against this:
"People will never give up their privacy to make this system possible."
The privacy conversation is not over by a long shot, but so far pundits are screaming while everyday users don't seem to care that much. We heard the same argument with cookies, and if the short history of the internet tells us anything, it's that sometimes people simply move on. Plus, Facebook is different than cookies—it's a service. It's opt-in. It provides a value for people, and the general population has decided that it's worth giving up some level of privacy to be connected. Facebook has momentum, and with social networks that’s a big deal. Switching costs are enough to keep people on board, even if they have disagreements with the provider.
"Not everyone is on Facebook, so it won't be a true measure of traffic."
True, but the latest numbers are coming in and 51% of internet users worldwide have a Facebook account. More than half, worldwide. Ever see a panel that large? Didn't think so.
"Facebook doesn't want to be seen as having their fingers in everything, they won't make this type of data public."
Really? You should get out more.
The Necessary Evolution of Facebook Insights
Facebook Insights is the tool that reports high-level metrics for business pages. High level is actually a complement –there's not much beyond "like" trends, a few engagement metrics, demographics, and sharing data.
Here's Facebook's own description of the information coming out of Insights today:
Today Insights is focused on Facebook Pages and Social Ads. So what needs to happen to take Facebook Insights to the next level?
Facebook needs to continue to see the Open Graph and Social Plug-Ins spread across the Internet.
Wider adoption will yield far more results. Continue to empower developers and encourage the spread of Facebook plug-ins by showing value for doing so. The new framework has seen more than 100,000 implementations within a few weeks, and this number will continue to grow as Facebook adds value to hosting the widgets.
Facebook needs an analytics tool.
Three ways to go here: partner, build, or buy. Facebook has struck some good partnerships, ones that could last even if an internal offering comes around. The current version of Insights shows there is some type of internal effort going toward metrics, and the push for revenue (read: advertising) to fund their growth will require a solid reporting layer beneath it. There are lots of small shop analytics providers out there, but the Facebook's internal hacker culture might see it as easier to build their own. The wise choice would be to wait for a custom Facebook analytics tool built by a third party to emerge, which should be soon now that the Open Graph API has been released. With that strategy, Facebook can buy a tailor-made solution and have less rework after purchase.
Privacy Concerns Need to Settle
Facebook will need this wave of concerns to pass, and to offer clearer privacy settings to give people control over their information. If Facebook works with the community to show it understands the concerns and builds future products accordingly, it will allow the site to use the valuable data it’s gathering without setting off alarm bells.
If Facebook can pull off all of the above, expect Insights to become something much, much larger. Something very, very valuable. Expect it to continue to challenge the status quo on privacy, and to offer huge opportunities for marketers while doing so.
Oh— and expect to pay for it, too.
2 Comments
Very interesting insights.
As Open Graph and Facebook "Like" components get embedded in sites across the web (in a similar fashion to AddThis), Facebook will be the center node in a huge data hub. For Facebook, taking the next step and providing analytics tools to brands makes sense.
Posted by: Graham Lubie | May 13, 2010 at 06:45 PM
The potential to do more is certainly there, a rich Facebook analytics will definitely be a powerful complementary data set to traditional web analytics. It probably have greater impact for behavioral targeting. SM is a big channel, but we still have SEM, SEO, Email that Facebook does not cover. Plus web analytics are not only for marketing, product management and engineering use them too to do optimization and MVT. Facebook currently also require users to initiated interaction with the API first before demographic data can be collected.
Posted by: Meng Goh | May 18, 2010 at 01:06 PM