Imagine the power of letting potential customers know which of your products their friends have purchased, used and now endorse. This is the power of Facebook’s social graph.
Every marketer knows the power of word-of-mouth advertising. In many ways it is the most valuable of all forms of promotion because it has two inherent aspects of immense value: trust and relevance. Where anonymous referrals are so prevalent that little trust or personal relevance can be placed in them, online personal referrals have the power of traditional word-of-mouth advertising.
Facebook has an amazing 550 million users across the world spending hours every day connecting with an average of 100+ friends. These users provide unprecedented information about their social networks, their likes and their interests. Having the ability to harness the incredible reach and detail of this data, combined with the power of word-of-mouth advertising, means that marketers have the opportunity to deliver the most powerful digital marketing tool we’ve seen in recent times – the Facebook social graph.
The social graph is a term coined by Facebook’s creator Mark Zuckerberg to describe the network of relationships that make up the Facebook social networking platform. In 2010, Facebook released its social graph API, allowing websites to draw detailed information about people, their likes and dislikes, their relationships and networks, even their photos, events and pages. The release of such a wealth of information is unprecedented and, in comparison, casts a big shadow over traditional data collection techniques.
While more traditional techniques remain a vital part of online marketing, they are littered with inherent problems and are usually costly. Gathering data on your target market is time consuming and expensive – most often a research or intelligence gathering company is required. Once this data is collected, it must be segmented and analysed to create profiles of your customers, their needs and behaviours. The result is a handful of generalised customer representations that, hopefully, have enough sophistication to provide value.
In comparison, online social networks provide a window into the lives of real customers and their social connections. Marketers have a fantastic opportunity to benefit from this by linking their business and, more importantly, their products to this network.
One of the key ‘social product’ opportunities, regardless of whether your product is information, a material object or a service, is harnessing the power of online personal referrals. Referrals have long been a technique employed by retailers to increase conversion rates, but until now they have come from anonymous users. By combining these tactics with a widespread social network such as Facebook, marketers have the opportunity to provide users with personal referrals from their Facebook friends.
The power of online personal referrals lies in both the accuracy of its targeting and increased user trust:
a) You know, and presumably trust, the source of the referral. If your friend has ‘liked’ the product you are viewing, you immediately put greater trust in the product, retailer and platform it is being sold on.
b) Due to the intricacy of socail networks and each individual’s interests, recommending items based on the total user average lacks the accuracy of personal referrals. Put simply, users are more likely to respond to prodcut suggestions that come from people they know.
Implementing the Facebook ‘Like’ functionality is relatively simple, requiring just a Facebook presence and the appropriate app or plugin, but enables users to promote your brand and products to their social networks. The potential return from this sort of personal referral is so valuable that it easily outweighs the investment.