Facebook’s goals and your goals (as a Facebook user) are starting to get misaligned. And it’s only going to get worse. I’ll come back to this in a sec.
Alan (former VP at my previous employer) has left Facebook. He brings up a lot of cogent reasons why.
For myself, I am a bit frustrated with Facebook. I receive a pile of “notifications”, “facebook mail” and (increasingly) “sponsored crap” every week, quite a bit of it quite deceptive in its desperate bid for virality (yeah, I know virality isn’t a word). Notes that say “John would like to see what you’re reading”, “Bob wants to know what your stripper name is”, and “Alex has posted some
We’ve all done it. Responded to these “personal” invites as if they really were personal invites (I have 6 iLike invitations from people who I’m SURE aren’t really that interested in getting me to use iLike), installed the application only to remove it a week later when you realize it doesn’t do a damn thing that actually adds value to your life.
I’d like to find the setting in Facebook where I can check a checkbox that says, “I would like to find what applications I want to install on my own, thank you!” (Can you find that option in the picture below? Am I missing a setting somewhere?)
So back to misaligned goals. One of my problems with free consumer apps is that the goals of the business are virtually NEVER aligned with the goals of the user. In the beginning of a startup (like Facebook), this doesn’t come into play. The business is 100% focused on adding value to the user. The user wants to get stuff done (share ideas, photos, communicate, whatever) and the business is desperately trying to help them reach these goals as effectively as possible.
Unfortunately, pretty soon the business runs out of easy ways to add value for the user. The growth curve slows down, and you start hearing people on the product team saying, “We want the users to…” more than “Our users want…”. And it’s about this time that investors are starting to look at the burn rate and wonder how the business is going to extract value from the user. With free services like Facebook, you have a few options… I’d imagine that they’ve functionally killed their virtual gift business by releasing a public platform like they have. So that leaves advertising or premium services. Unfortunately, I haven’t heard a whisper of premium services from Facebook.
The funny thing is, users really aren’t too keen on advertising, no matter how targeted they are. And with a high use-per-day app like Facebook, they become downright invisible to the users. Quite a few people have noted that FB advertising is pretty painfully ineffective. Which means that the business needs to make ads more plentiful, more invasive, or more expensive… All of which have pretty serious negative ramifications for the user. And because EVENTUALLY there is a drive for constant revenue growth at consumer facing web startups, where else can they turn? Of course, you could argue that Facebook, with their new ad platform, have a better understanding of their users that just about anyone (in terms of demographics and intent)… But between the ad blindness that is a huge problem on utility-style apps (when was the last time you read an ad in Gmail? How about clicked on one?) and because Facebook is built on trust of your NETWORK, I think the “but Facebook advertising can be sooooo targeted!” argument doesn’t hold up.
Take any free consumer site that’s more 5 years old and you see how ugly this slippery slope can get. Interstitial ads, Flash ads that obscure the content of the site, pay-per-click garbage, and more. If Facebook doesn’t start looking in other directions, this is where they’ll be in a year or two– trying to manipulate their users into clicking on (or viewing a lot of) ads.