After more than a year of implementation, the Facebook Like button has pretty much proven itself to be a viable social media marketing tool for online content providers. TechCrunch recently reported that, despite having much less fans on their Facebook account than on their Twitter account, Facebook is sending way more traffic than Twitter (source). Perhaps 140-character limits, shortened links, and lack of multimedia support are not exactly the best conditions that enable effective social media sharing; sharing a la Facebook seems to drive greater engagement after all.

It is reports like this that encourages content providers to focus more on getting people to share their content on Facebook rather than on Twitter; one could argue that a whole art focused on how to get Facebook Likes has emerged. Fan-gating is a popular technique, while other businesses use contests where their fans can upload their own content to be voted on by others – of course, to vote on any piece of content, you have to Like the Facebook Page first. Fashion/apparel brand companies like to run simple contests where their fans can upload pictures of themselves donning clothes of said brand, and whoever garners the most Likes by a closing date wins some vouchers. Participants would naturally pester their friends to Like their picture; however, to Like a picture on a Facebook Page, you need to Like the Facebook Page itself first. Loef recently ran one such gimmick.

Another increasingly popular method is a modified, cliffhanger version of fan-gating. Instead of asking for visitors to Like a Facebook Page or web page upfront, content providers lure people in first by providing great content upfront, building up a story up to a certain semi-climatic point, and then asking for a Like/share upon reaching a cliffhanger. Chinese short story websites and blogs are particularly fond of using this method. The following picture shows an example that helped this simple Chinese short story garner almost 200,000 Likes:

Do you know of any other novel way of garnering Facebook Likes? Or have you tried some methods of your own, which worked or did not work (like ours)? Let us hear about it in the comments section below.

In the past, we have used the Facebook Like button as a baked-in promotional mechanism to drive referral marketing of deals, and that formed the core functionality of our product (see screenshot below for an idea of how we did it with our SaaS group buying solution for online retailers). After nearly 6 months of collecting data and experimenting with the Facebook Open Graph API and plug-ins, we have decided once again to use Facebook like how every other business uses it – as an independent, bolt-on, add-on sharing mechanism, and nothing more. We will no longer be giving Facebook VIP status in our product.

Here are some problems with Facebook:

1. The Facebook API changes too often. The plug-ins are buggy, the API changes without notice rather often, and there are too many rules constraining how developers can use the API in building applications. As a platform, it is unstable, period. It may be a good idea to use Facebook as a platform for consumer applications, but it might have been a mistake for us to use Facebook as a platform for an ecommerce application.

2. Facebook is overhyped. Personally, even though Facebook actually has 600 million active users, developers still tend to overestimate how many people actually 1) have a Facebook account, 2) use it regularly, and 3) are comfortable using it as a third-party authentication method. Many consumers across different niche markets are simply not familiar with how Facebook works; developing Facebook-only applications marginalizes this segment of users, who may be substantial in number.

3. Facebook is still mainly social for most, and exclusively social for some. We are still not completely convinced that Facebook can be an effective platform for ecommerce or any commercial activity, i.e. does anyone even care about commercial offerings on Facebook? Low sales on so-called f-commerce platforms seem to support our view. Some businesses may be too quick to assume that, just because Facebook works for games, it will work for ecommerce. Of all the new variants of ecommerce, the one that might actually take off is, in our view, mobile commerce.

So which direction are we now taking with our product, Zuupy CrowdDeals? We are now focused on point-of-sale transactions, working more like a sales tool that facilitates group buying transactions and processes, leaving the marketing of deals largely to our customers (online retailers themselves). We hope that this small product pivot would serve as a better fit to what the market wants. After all, Likes are ultimately useless. Sales are what matters, and that is what we aim to bring to our customers from here on.

A recent Harvard Business School study has found that, if your customers are heavy social media users, they are more likely to refrain from making purchases as a result of encountering commercial offerings on social media, particularly those from friends. The results are succinctly summarized in this article.

The interesting question is obviously why. According to the study report, heavy social media users are “well connected, high status members” who are less likely to be positively influenced by the purchase behaviour of people in their network. Instead, they are likely to be influencers themselves and essentially see no reason in following their followers. In fact, they would probably actively go against what their so-called followers advocate, as it is unbecoming that a leader would want to look to her followers for direction, even when it concerns something trivial like online shopping. Pride seems to be the underlying reason.

The study did not authoritatively pinpoint the reason for the negative effect of social media on the purchase behaviour of heavy social media users but merely made speculations as to the explanation behind the results. What is relevant, however, is that more impressions and more buzz do not necessarily lead to an increase in positive engagement. There is also the possibility that heavy social media users are just not active purchasers in general, i.e. the negative engagement observed is not caused by their being heavy social media users. The results can truly be interpreted in many ways.

Does this mean that, if your customer base comprises heavy social media users, social commerce may be a futile investment? It is perhaps so, but if your customer base consists primarily of influencers by definition, there may be an opportunity to use them as a conduit to reach a wider audience, driving an increase in awareness and reach. So while their own purchase tendencies may be suppressed, their ability to affect the purchase tendencies of others may not be diluted.

After all, you do not have to purchase an offering yourself to (want to) promote it to your friends. What is your take?

Singapore, a country with an electorate of no bigger than 3 million, is heading towards polling day on 7 May 2011. While the last general election in 2006 saw little use of social media (with the exception of blogs), the general election this year is heavily influenced by social media, in particular Facebook. Voters and candidates alike are using Facebook for political campaigning in unimaginable ways, including using business cards with Facebook skin and creating fake profiles to give the impression of a more balanced distribution of support for the two sides.

One notable phenomenon on Facebook is the rise of Nicole Seah, a 24-year-old candidate from a non-leading opposition party with little work experience whatsoever, who has won more than 42,000 fans in a span of less than two weeks. These numbers may not sound impressive, but consider that Lee Kuan Yew, Singapore’s George Washington, Abraham Lincoln, and John F. Kennedy all baked into one super-strongman, has a Facebook page that garners about 55,000 fans over several years. Nicole is currently the second most-Liked politician in Singapore:

Facebook may be the very reason that this year’s general election may turn out to be very different – it already is very different in terms of its build-up. More voters are using Facebook to write political Notes that are shared publicly, and real-time data and communication allow for a scalable way of spreading information through Pages and status updates. Information spreads like wildfire, and, in a city-state with high IT-literacy, the state-backed mainstream media might find itself increasingly irrelevant.

Ultimately, Facebook seriously increases political awareness and engagement among voters. It inspires emboldenment, by allowing like-minded people to gain idea validation, it brings to light issues of concern (e.g. alternative policies, voting secrecy, political scandals), and it fuels activism, something that the generally-passive Singaporean population is often accused of being incapable of. In a way, Facebook is also a leveler of the political battlefield, given that the incumbent government would find it very hard to regulate the flow of information on a third-party platform hosted in the US.

Will some votes swing because of Facebook? No doubt. The question is, as with online marketing, to what extent online metrics, such as shares, Likes, number of comments, etc., are correlated with results (be it the number votes or online purchases).

Recently, Facebook rolled out its Q&A feature, aptly named Facebook Questions. Just like most Facebook apps, your activities related to Facebook Questions are likely to be posted on your profile as part of an inherent viral loop (web marketers come up with the coolest-sounding terms). These updates are intended to be shown to your nosy friends who, from time to time, visit your profile in search of cool things to consume. In the context of Facebook Questions, it is hoped that said friends would also participate in the answered question, thus posting an update to her Wall, perpetuating the viral marketing loop.

Everything sounds great, but we suspect that a great number of Facebook users detest having their profiles defaced by updates that they did not specifically post. Though Facebook users might not think too far in terms of marketing mechanics (a la “How dare you use me as a involuntary viral marketer!?”), they do think in terms of aesthetics and individuality (a la “Why are you polluting my Wall with spammy updates?”). In our experience, when Facebook rolled out Facebook Questions, everyone was excited and busy posing and answering questions. It died down pretty quickly thereafter, presumably because people have learnt to be more selective in the questions that they answer, since they know that whatever questions they answer would be posted on their profiles. Sure, they could remove the updates after that, but that would defeat the purpose of answering the questions in the first place. Over time, users learn to only answer questions that they really, really care about, such that the updates posted on their profile form an extension of their identities.

In our opinion, the solution to this problem is rather simple: remove the “Profile” link at the top-right navigation bar in Facebook. The “Profile” link serves little purpose, other than to tempt us from time to time to visit our own Wall without any specific aim in mind. It simply serves as a reminder of how our Walls look like to others. At Zuupy, we are perpetually concerned that Facebook users do not become too protective of their Walls, as we rely on Like updates to drive viral marketing for our daily deal solution. Removing the “Profile” link would result in less housecleaning, which, from a marketer’s perspective, is good. The only thing that usually comes out of a user visiting and revisiting his Wall is that she would get busy with the “Unlike” and “Remove Post” functionalities.

What purpose do you think the “Profile” link serves? Do you tend to create content more often than delete content when you click the “Profile” link? Do you care about how your Wall looks like to others?

In the past, we have chastised the idea of selling on Facebook (f-commerce): here and here. Recently, there have been several reports that social commerce may just be a bunch of hype, and, more relevantly, there are now compelling sales data pointing towards the infeasibility of Facebook as a platform for commerce. Forrester Research, Inc. released its latest report on the so-called f-commerce phenomenon, which has been neatly summarized in this SocialCommerceToday.com article.

Simply put, the results are pathetic; nobody has made any major money on Facebook to make it a worthwhile customer acquisition channel to consider. Worst of all, online retailers infected with the herd mentality still often charge ahead with plastering their website with Facebook Like buttons, buying fans (seriously?), installing f-commerce software on their Facebook Pages, etc. without a clear idea on how to turn a profit on those efforts. We have always wondered if Facebook’s explosive growth and hype have actually clouded the judgment of brands and retailers into believing that Facebook is the elixir to all marketing and branding woes.

No, Facebook is not the panacea for all ills. Use it for customer service, user feedback, or even for short-term deals and promotions if you want, but do the actual commercial transaction elsewhere – somewhere more stable and less vulnerable to API/policy changes. Any Facebook developer can testify that developing Facebook applications can be a nightmare sometimes; we never know what will change tomorrow. Platform issues aside, we really should also consider what or who we are competing against when we decide to peddle our goods on Facebook. No, your competitors are not other brands within your niche; think again.

Consider this quote by Paul Marsden:

“Facebook is a people-centric forum, and whilst huge – a forum it is. And the forum has been around since the 1970’s – do you know any businesses that made money from connecting forums with retail?”

Try competing with a consumer’s closest friends and family members. We would be very surprised if a large number of consumers would prefer to pull out their credit cards and make a purchase on a cramped “Facebook store” than to comment on their friends’ new haircut or post witty status updates to garner Likes and congratulatory comments. The blue bar on top of Facebook.com is an f-commerce retailer’s biggest enemy, just as the back button in a browser is a website owner’s biggest enemy. Once a red notification number appears, it is game over (or cart abandonment, whatever you prefer to call it).

How sticky a social network is is largely determined by the size of the network as well as the quality of user experience. If Friendster could lose its edge due to spam, Facebook – essentially a better version of Friendster – should be extremely wary about the spam problem. Recently, there have been reports on Facebook Likejacking (e.g. here and here), which involves a user going to a website, doing anything but clicking a Like button and yet finding a “Like” post on her Facebook profile several seconds later. Basically, this is clickjacking applied to Facebook.

The change in the behavior of the Like button is extremely advantageous to malicious developers who want to engineer their own viral marketing campaign. While the Like button previously posted a one-line text update to one’s profile when clicked, it now posts a full-blown link sharing update with a thumbnail, description, etc. All a developer needs to do is to somehow get visitors to click on a Like button, which can be craftily hidden using CSS/Javascript code. The most common technique that we have witnessed so far is to get visitors to click on a video thumbnail with a play button.

Likejacking is problematic, because it defaces user profiles and reduces signal-to-noise ratio on Facebook. For Facebook to maintain its lead in social networking, it should continually ensure that the basics, such as a spam-free environment, are taken care of. One simple solution on how to tackle the problem is to leverage on the crowd to annotate particular posts as Likejacking spam, so that Facebook can ban certain URLs or prohibit certain websites from utilizing the Facebook Like plug-in. Instead Facebook took another route.

Have you experienced Likejacking? How do you think it will change Facebook?

We are constantly observing how the technology landscape is changing where we are (Singapore), and recently we have come to know of a Malaysian web startup, FongFeiKei.com, that aims to be a marketplace for people who need to sell off their concert and event tickets urgently because their previously-going-with-them friends stood them up. While the concept itself may not be new, we have come to realize that one viable way of discovering what the grassroots wants is to literally sit back and watch our Facebook News Feeds for hours and monitor how people are using Facebook in a way that facilitates or results in money transactions. Anyone with the habit of trawling through their News Feed on a daily basis would already see trends in how their friends use Facebook to fulfill certain needs.

Indeed, this method was how we got the idea for our flagship product, Zuupy FriendAdvisor, an online store add-on that lets shoppers consult their friends on Facebook for shopping advice while still shopping in the online store itself. In 2010, we saw that many people were asking for shopping advice by posting links of products, and, most of the time, friends were egging them on to buy. Can we say... conversion optimization opportunity for online retailers? Keep in mind that Best Buy relatively-recently implemented the “Ask Friends” feature in its Facebook Store, a feature that is very, very similar to Zuupy FriendAdvisor.

The fact is that, as Facebook grows in the number of functions that it serves, the News Feed will become less useful, considering that the signal-to-noise ratio will be increasingly unbearable. There exists multiple opportunities for vendors and entrepreneurs who can identify pockets of niche markets by picking out very specific yet sizable use cases of the status update feature. The rule is, of course, that your friend list must be large and diverse enough for such deeds of scrutiny of the grassroots population to be carried out effectively. For example, we at Zuupy have identified that using the status update feature to garner votes for contests and causes has become very prevalent. Perhaps there exists an opportunity to create a voting platform based on a vote-for-me-and-I’ll-vote-for-you model that monetizes via the sale of votes or ranking/prominence advantages on the platform.

The great thing about the Facebook News Feed is that it helps to crystallize the needs and wants of the demand side. As with most things, where there is a demand, there is a supply. Do you think that this method of understanding consumers is viable, or do you think that it is flawed or can be improved?

Social media marketers in general are fond of garnering more Likes for their Facebook Pages or web pages, in hopes of either providing social proof through sheer number of fans or amassing subscribers to be fed announcements, promotions, offers, and contests. Clearly, there is some evidence bolstering the effectiveness of these tactics (see SocialCommerceToday.com’s latest article on social commerce statistics), but, as with any prudent use of social media marketing tools and technologies, what really matters is not adoption or user behavior but ROI. The key question is still, “How many dollars am I getting back for every dollar I sink into this channel?”

There are many use cases for the Facebook Like button (to create a viral group deal solution, for instance), but consider the following points before adopting a “the more, the merrier” strategy with Facebook:

1. The number of subscribers alone is not ROI. It is helpful to view Facebook Pages as websites. Facebook Likes are somewhat analogous to traffic, and engagement (i.e. the act of actually following your updates) is somewhat analogous to conversion. Focusing on improving the Like count without ensuring that there is a valuable offering or content to drive engagement and action is, needless to say, a wasteful strategy. Of course, as Sean Ellis said, we should focus only on channel building or channel optimization at a time and never do both concurrently. The point, however, is that engagement is a crucial marketing component that is often overlooked.

2. The “social” context of Facebook is not conducive for commercial offerings. Our view has always been that “commercial social” is unlikely to work on a big scale, because it does not add value to the core purpose of Facebook: to stay connected with the people whom we love and care. This is a major pitfall of commercializing social media: unlike search engines, showing ads and offers is not contextually relevant and interferes with the socializing process. Search engines, on the other hand, are used to answer questions, and, often enough, ads are the answers to said questions. Social recommendations are only likely to work if it has some contextual relevance factor working in its favor.

3. Users click the Facebook Like button for different reasons. It has been reported that 40% of consumers Liked a company, brand, or association on Facebook to receive discounts and promotions (ExactTarget, September 2010) [1], while nearly 40% of consumers Liked companies on Facebook to publicly display their brand affiliation to friends. (ExactTarget, October 2010) [2]. Depending on how you interpret the statistics, they can mean different things. One possible interpretation: the majority of consumers who Liked a brand did not care about discounts and promotions (from [1]), while nearly 40% of consumers Liked a company merely for a social reason – to garner peer approval (from [2]). Any prudent marketer knows that assuming worst-case scenario is a standard procedure in the decision-making process.

4. Facebook is biased towards its own users. It is baffling that many agencies, companies, and brands are ready to expend top dollars on even buying Facebook Likes. Clearly, this method is the ultimate shortcut to Facebook list-building, but consider that Facebook makes it very convenient for users to unlike a Facebook Page or a web page (look at the tiny X on the top-right corner of each post). Unlike Friendster, Facebook knows that spam kills and kills quickly.

5. Facebook Likes are only useful if they are not used solely as social currency. The concept of social currency states that brands and companies will offer something valuable in exchange for sharing said offer or company via social media by users. We have previously explored the use of Facebook Likes as social currency (here and here) and opined that anything achieved through compulsion is unlikely to produce returns. Also, unlike cash, Facebook Likes and Tweets are also very easy to take back. The problem is that the social currency model is becoming increasingly common (e.g. “Like this Page first for...”) and is sometimes even the core fan acquisition strategy.

In the final analysis, the real value of Facebook lies in its user base and mass distribution model for content. However, a user base is just that: a market, which may or may not be easy to penetrate or engage. Although trite, the key to effective Facebook marketing is to attach an actionable metric to every tactic that measures ROI directly. Perhaps even buying fans is a highly-viable fan acquisition strategy; all we have to do is to look at the numbers and then decide.

A recent article by Techcrunch revealed that Facebook Shares are worth nearly three times as much as Tweets when it comes to social commerce. After using both Facebook and Twitter for more than a year, we at Zuupy do not find the statistics surprising, considering that Facebook has the significant advantage of leveraging on our real-life social graph to empower our purchases while Twitter merely relies on our interest graph. Alas, for Twitter, we are still more likely to trust a friend than an industrial expert or celebrity.

One implication of these findings is that Tweets will be perceived as less valuable as social currency. The reason is pretty obvious: the Twitter experience is horrid. First, for professional networking, Twitter generally comprises a body of self-serving broadcasters who are constantly pushing out content of their own and increase their follower count without any intention whatsoever to engage with their followers. Second, the text-only, 140-character nature of Twitter lost its novelty after a while, and, despite recent attempts to support multimedia from Twitter.com itself, it is still a slow and cumbersome process to consume content on Twitter. Even the infamous one-liner updates achieved via Facebook Likes monetize better than Tweets.

The lesson for us is clear: focus on Facebook first, and then explore Twitter. Google recently announced its social search feature, which, although more focused on Twitter than Facebook (Facebook profiles are not crawlable after all), underscores the importance of the social graph in empowering search results. In general, especially with consumers, “Facebook is the people you went to high school with. Twitter is the people you wish you went to high school with.”

Also, with recent studies showing that Facebook social commerce is really about deals and not engagement, the lesson for us is perhaps to focus on Facebook and deals simultaneously. Indeed, the launch of our latest competitor, CrowdBunny, provides testament to the opportunities available in the area of Facebook group buying. We have launched a couple of months before them, and we are just excited to see some validation in terms of competitors entering the space. We see social commerce as focusing on Facebook and group deals in the near future, as evidenced by our Facebook group buying solution. What do you think social commerce will look like in the near future?