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When Facebook unveiled "Beacon", its new advertising platform earlier this month, it unleashed a simultaneous bi-polar reaction. From privacy advocates, there was outrage and concern.
From advertisers, on the other hand, the introduction of Beacon was as if Facebook had just handed them the keys to El Dorado.
Laura Scott wrote a comprehensive post called Facebook's New Ads: If You're a Good Person, Why Should You Want Privacy? that delves into the privacy concerns.
While the blogosphere is bursting with Beacon critics, major corporations--44 in all so far--have signed up to be part of Beacon including eBay,Coca Cola, New York Times, Blockbuster, Amazon, Bluefly.com, CBS Interactive (CBSSports.com & Dotspotter), ExpoTV, Gamefly, Hotwire, Joost, Kiva, Kongregate, LiveJournal, Live Nation, Mercantila, National Basketball Association, Overstock.com, (RED), Redlight, SeamlessWeb, Sony Online Entertainment LLC, Sony Pictures, STA Travel, The Knot, TripAdvisor, Travel Ticker, TypePad, viagogo, Vox, Yelp, WeddingChannel.com and Zappos.com.
At its best, Beacon represents a new breed of designer marketing that is being dubbed "social advertising. Think extreme target marketing meets word-of-mouth marketing.
From the CBC:
If you buy a book on Amazon, a little bit of code is embedded within that site then sends the data to Facebook and informs your friends that you've bought a particular book. Or say you're surfing the recipe/food site Epicurious and rate or comment on a few recipes, again your Facebook friends will be notified of your culinary interests, as will Facebook itself and their advertising partners. Thus where Facebook used to be collecting data only within the confines of its own website, it will now extend that ability to harvest data across other websites that it partners with.
It is what the CBC calls an advertiser's treasure trove. While American consumers may say they (a) don't pay attention to advertising (b) are not influenced by advertising (c) find advertising to be a deceitful, distasteful industry,consumer behavior says something else entirely.
As a society, Americans embrace advertising and they love targeted marketing particularly when the targeting results in loyalty programs that offer perks and benefits like frequent flier miles.
Businesses know that if you target correctly and reward proficiently that consumers will respond with a loyalty that is amazing.
Before American Airlines introduced the idea of frequent flier points in 1981 people made their airline decisions based on the time a carrier would get them to their destination. People had a window of tolerance of about 30 minutes.
After frequent fliers points were introduced, people's behavior changed dramatically. Instead of asking which airlines could get them to SEA TAC at 1:00 p.m., people asked what flights the airline had in the afternoon. As long as the flight came within 3-4 hours, people would book the flight.
From a 30 minute window to 3-4 hours. That was a huge shift for the airlines.
But its not just the targeted marketing that makes advertisers salivate.Facebook's Beacon has a word of mouth component that is sheer advertising nirvana. While advertising is an industry consumers love to hate, those same consumers say that having a friend recommend a product is different. For advertisers, personal endorsements---word of mouth marketing --is the creme de la creme of advertising strategies.
Writing about Beacon for E-Commerce News,Katherine Noyes quotes eBay's senior vice president and chief marketing officer for eBay North America,Gary Briggs.
"Beacon offers an interesting new way for us to deliver on our goal of bringing more bidders and buyers to our sellers' listings," said Gary Briggs, senior vice president and chief marketing officer for eBay North America. "In a marketplace where trust and reputation are crucial to success, giving sellers the ability to easily alert their network of friends -- the people who already know and trust them -- to an item for sale has the potential to be a powerful tool."
In a post called Facebook Ads: 'Not Really Creepy as Much as Inevitable', blogger Ann All shares consumer reactions to Facebook's social advertising strategy.
Some excerpts of reader comments:
* “Not really creepy as much as inevitable.”
* “I actually feel kind of special. To be honest, I never click ads, and I clicked this one, and I’m pretty satisfied. On a more generalized scope though, of course it’s a little disturbing, but we caused it. “
* “In a way it’s good, because I’m seeing advertisements about things I already like and don’t have to ignore another flashing auto insurance banner.”
* “‘Capitalism is capitalism’ has never been an effective argument for letting people exploit others
