If the only thing Facebook launches at this week’s f8 developer conference is a new media player, I’d be disappointed.
To reach a $100 billion valuation, Facebook must reshape e-commerce.
Here are four product moves that would help Facebook make an immediate splash in e-commerce.
1. Offer real-time, status-message-targeted ads
The product never formally launched, but would really help Facebook ads appeal to a new class of marketers, although it may drive up the average cost-per-click for these promotions.
Facebook ads have been a home-run for brands and local businesses that want to build lasting relationships and cultivate loyalty among their customers, but they have been less successful in direct marketing businesses like mortgage and insurance, which happen to be Google’s biggest cash cows.
Advertisers in these businesses generally believe that no one on Facebook is willing to buy, and some have estimated that more than 50 percent of ad clicks were simply user mistakes.
By contrast, they are happy to pay high prices for Google clicks in the belief that these searchers have a higher intent to buy.
2. Launch a social advertising plugin
Facebook has invested heavily in social plugins designed to be used outside of Facebook, but so far a social ads plugin has been conspicuously absent.
A social ads plugin could be a huge success in industries where trusted recommendations have a huge impact.
3. Open EdgeRank to developers
It’s no secret that Facebook is studying our relationships. Using an algorithm called EdgeRank, Facebook guesses which friends are most important to us and builds our newsfeeds accordingly, as Facebook engineers revealed at last year’s f8.
Application developers, however, still have no easy way to distinguish users’ close friends from weaker connections. Instead, friends are listed in the order that they joined Facebook. Many developers have created their own EdgeRank-like formulas, but these inevitably require sensitive permissions that users are reluctant to grant.
Given that people are so much closer to their top ten friends than their last ten friends, Facebook could empower developers to provide much better social experiences simply by making EdgeRank information available on other websites (with users’ permission, of course). The implications for social commerce would be huge.
Some users would surely complain about any attempt to quantify friendships, but these objections could be easily overcome. Facebook could hide the raw data and simply group friends into categories.
Even if Facebook only indicated which friends are in a user’s top 20 or 50, it would be a tremendous improvement on the status quo.
4. Open the social graph
Facebook launched the open graph at last year’s f8. The big idea was to allow Facebook users to like (and become fans of) pages on other websites.
The open graph project has been a big success, but something is missing. Facebook’s existing tools do not provide any way for users to connect with people that they meet on other websites.
Facebook is in a unique position to power relationships on other sites, and would cement its leadership position in the ongoing identity war against Google by doing so.
Imagine a tab on your Facebook profile that showed you which connections were on different media outlets, with links to profiles, making it easy to become Facebook friends as relationships develop, as well as links to profiles on the site where connections were originally made.