[I had blocked out this post. The next day, I saw Patricio Roble's excellent post, making much the same point. I have more to add, though, so read on.]
Facebook’s recent changes to the privacy settings are, by all indications, designed to encourage people to share information publically, and make it harder to keep information private. Speculation is: this is part of its continuing attempt to compete with Twitter in the real time market.
It’s a mistake. Facebook should smarten up and stop competing with Twitter. Instead, Facebook should properly focus its efforts on figuring out how to monetize its users’ far more valuable private, but personal data.
The two networks are used differently by their customers (which, often enough, are the same people). They have different advantages and disadvantages because of that.
|Privacy = more personal information shared|
|Personal information = better quality data for business/advertising use|
|Public = more broad-interest information shared (but less personal)|
|Real time stream = data is more timely and pertinent to the moment|
What Facebook seems to have overlooked is the simple fact that people share their personal data because they can control who sees it. If privacy is compromised, people are less willing to share personal information. (See the end of this post for links to some relevant studies.)
That is quite likely why Twitter has become, and now positions itself, as an information network—not a social network. On Twitter, people share lots of information, but only information they are willing for the world to see, because that’s the way Twitter rolls.
While that broad, public information is useful, private information is much more valuable to marketers and advertisers. Facebook is the kind of place where you could potentially target first-time expecting parents, in the seventh month of pregnancy, expecting a girl, and actively looking for suggestions about cribs and bedding. That’s not the kind of detail you can compile through Twitter. Facebook’s data lets advertisers target exactly the right product at exactly the right point in the sales funnel.
Instead of striving to be Twitter, Facebook should make it even easier
for users to control whom they share their information with. Doing so will likely encourage people to share more information. For example, if it’s easier to share some posts with my professional circle and some with my personal circle, I’ll be more inclined to use Facebook for both. Right now, it’s extremely cumbersome to post from my home page and specify that the post is only for my professional followers or only for my personal friends. So, I have to choose.
Consider the fact that consumers are increasingly comfortable with behavioral targeting, and show an increased willingness to accept relevant advertising from companies they trust.
Users make a distinction between individuals being able to find them online and view their private information, versus businesses being able to leverage their anonymous private data. They emphatically don’t want strangers to be able to find and view personal information. But while consumers may not like the fact that their data is being tracked and used by advertisers, they are getting used to it and aren’t likely to vacate a site because of it. They will vacate if individuals can find and view their private info.
That means that Facebook can:
|offer users greater control over privacy,|
|which encourages more sharing on Facebook|
|providing more valuable data to businesses|
|which users are willing to allow businesses to leverage.|
The missing piece then, as I blogged about in the Evolution of Social Networks, is for Facebook to provide unique new ways for businesses to leverage that information.
Let’s think about some of the opportunities Facebook may be foreclosing by forcing people to choose between sharing information with friends or protecting their privacy from strangers:
- Because they can keep the information limited to family and close friends, parents are willing to talk about their children, give their ages, and discuss their children’s latest hobbies and interests. Holiday season retailers are able to use that information to target ads to parents of children in specific age groups, advertising products that match those children’s interests.
- Because they can control who sees their relationships and relationship status, users are willing to indicate their spouses/partners on Facebook. Marketers are able to find couples discussing cars and soliciting suggestions from friends for car purchases, and then advertise to both spouses in the same timeframe.
- Grandparents are willing to post and tag pictures of their grandchildren on Facebook, because they know that strangers can’t see them. Marketers are able to develop applications for grandparents who are shopping for their grandchildren. The applications let these grandparents “try on” clothes for their grandchildren by showing the clothes over the child’s picture, so the grandparent can see how it will look.
If Facebook spent as much effort on finding creative advertising avenues like these as it does on competing with Twitter, it would quickly leave Twitter in the dust.
Supporting Data on Privacy
“Facebook users in this study were generally concerned about their privacy and reported that they were likely to use the privacy settings provided.’ 2009
“The majority of teens actively manage their online profiles to keep the information they believe is most sensitive away from the unwanted gaze of strangers… they rarely post information on public profiles they believe would help strangers actually locate them” 2007
“The Pew Internet and American Life Project study finds that youth and adults use the sites primarily for maintenance of offline social relationships and that younger users are more acutely concerned about their privacy on online social networks.” 2009
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