Re:How Advertising Works, and Why It Won’t For Facebook
by mattmaroon on Saturday May 10, 2008 @12:29AM
(#186184)
Google can do a much better job with consumer B than Facebook. Facebook has to guess based on his wall posts, listed interests, etc. Given the sad state of natural language parsing, how well do you think this will work? At best they'll look at the bands I like and recommend similar ones. If they're lucky, they'll end up as good at that as Pandora. Or Netflix for movies.
Google knows your interests based on what sites you visit. Perhaps you visit an auto blog, which has Google Ads. Then you visit MySpace, which has Google Ads. Google shows you auto ads on MySpace. This sort of thing is already commonplace with ad networks.
Google has your entire search history. This is a far more effective way to determine your interests than Facebook. Facebook can't get beyond what bands and books and movies you like right now.
Let's say we split the market into two parts: Consumer A already knows he wants a particular product -- advertising is just a way to get him to buy it from you. Consumer B doesn't know what he wants -- he doesn't want anything just now. Advertising is a way to change this.
Isn't a list of Consumer B's interests, hobbies, friends, their interests, their hobbies, etc., a fantastic resource for targeting him? And isn't he an incredibly valuable customer? Apple didn't succeed by telling existing Mac users to buy more Macs (though they do!); it succeeded by getting people to switch. If Apple could target people whose status is "SP3 crippled my machine," or "Zune broken" or whatever, I'm sure they'll pay more for those users than they will pay for "Buy new Macbook pro" to link to Apple ads for Macbook pros as well as the Apple website selling Macbook pros.