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Noman Ali: Gadgets, Websites, Google, Social Media and SEO


Category Archives: Facebook

German government officials have pressured Facebook to stop spamming people to join the social network after a contact uses the Friend Finder feature; apparently these messages went out even to people that hadn’t been expressly invited by a human.

The company agreed to change this after the city of Hamburg’s data protection office made official complaints to Facebook, according toDer Spiegel. The officials had responded to gripes from people who got emails that included images from profiles of contacts from messaging address books.

The spam had showed signs that Facebook retained the contents of users’ address books from third-party applications well after said users had sent out invitations, and messages went out to people who hadn’t specifically been invited by the person who’d used the Friend Finder feature.

“For many, it wasn’t clear at all how Facebook could know that they knew certain members of the social network in real life,” says Johannes Caspar, who handles data protection issues for the city-state of Hamburg. “Facebook will be required to alert users that they should only send invitations to those contacts who they know personally and who, in their opinion, want to receive such an invitation.”

Now the Friend Finder will make a disclosure to the user whenever that individual loads an address book and ask permission before sending any invitations. Recipients of these messages will also see an explanation of why they received an invitation and have the option to block future mail from Facebook.

We’ve asked Facebook to clarify whether the improved transparency in the Friend Finder will become available only in Germany or worldwide. So far, the social network hasn’t answered that same question when posed by Der Spiegel.



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Last week I was talking to my Uncle about a company he has been invested in for quite some time. He asked me what I thought about the way they were using Facebook to market their medical device. Yep, a medical device. I said to him, “what do you need a fan page for?” He simply replied, “well, everyone seems to have them so we thought we should, too.”

And that’s when I proceeded to thrust my forehead into my hand. Just one of thousands of cases where people create a fan page because of Facebook’s buzz. It’s as if people think that if they create a page on there, people will not only find it on their own, but they would love to cloud up their newsfeed with your corporate propaganda. Who wouldn’t?

Now I’m not saying that he shouldn’t have one, I’m just saying that unless you plan on doing something more than throwing it up there and regurgitating your RSS feed – there really isn’t a point in investing time in it. At that point your fan page is doing nothing for you or your fans.

Which brings me to what should be the simplest conclusion in marketing: if you’re going to enter a market, you need a strategy. Facebook, Twitter, anything really, all need their own custom marketing strategy. Without one, you’ll be doing nothing but spinning your wheels and all of that time you spent doing so could have been used to sell more of your product/service.

How do we go about creating a marketing strategy for Facebook? The first step is easy: research. You need to get an understanding of whether or not your audience is even interested in seeing you on Facebook. Remember, they are on there to socialize with family and friends. Take a look at what your competitors are doing, or even your industry associations. Any company that is related to your industry is a case study you can study to determine what type of market exists for you on Facebook.

You should be taking note of engagement metrics like comments, likes, wall posts and their total number of fans. Which updates receive the highest engagement from fans? What time of day and day of the week are fans participating the most?

And the big question you want to answer is: what is their unique value proposition? You’re going to need to answer this one, too. You need to convince your potential fans that if they don’t “like” your page, then they’ll be missing out on unique content they can’t find anywhere else. You’re fan page is much more than an RSS feed dump, its a resource for them.

How can you go about making your fan page a resource? Unfortunately, there isn’t a general option that any company can use. It’s going to depend on what your product/service is. The first thing that comes to mind is Facebook-only coupons and discounts. Let’s say your a local restaurant who is looking to do more than the traditional coupon strategy. You could post Facebook-only recipes, announce daily specials and giveaways to only your Facebook fans, and even take polls from your fans for what the daily special/desert should be.

The point is, with as crowded as our online lives already are, if you want someone to do more than just “like” your fan page – you need to give them a unique experience. All of the case studies that are referenced have this. They are thinking outside the box and are looking to take advantage of the personal relationship Facebook can create between their company and their customers.

What are you doing to create the perfect Facebook experience for your fans?

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Facebook’s latest round of financing from Goldman Sachs at a $50 billion valuation, which is about the same valuation its shares are trading on SecondMarket, clearly puts it in the pantheon of the most valuable Internet companies. At $50 billion, Facebook is now worth more than Yahoo (which has a $22 billion market cap) and eBay ($37 billion), and almost worth more than both of them combined—and that is before it has even gone public. On the valuation scale of publicly traded Internet companies, however, it is still smaller than Amazon ($83 billion) and Google ($193 billion).

Facebook passed Yahoo in implied valuation last summer. And that feels about right. But is Facebook actually worth $50 billion? Its revenues for 2010 are rumored to be around $2 billion, which gives it a multiple of 25 times revenues. Google, in contrast, is trading at about 9 times estimated 2010 revenues. Of course, Facebook is growing much faster. And what really matters is profits. Facebook is believed to be profitable, but nobody really knows how profitable and there is still a sense that it hasn’t quite perfected its monetization model for social ads.

If anything, Facebook’s desire to push of an IPO as long as possible buys it more time to figure out its business model. Right now, it is just raking in cash based on the fact that 1 in 4 pageviews in the U.S. are on Facebook. It is a volume game, not a quality ad targeting game (yet).

And look at Groupon, which is now valued at about $5 billion with probably half the revenues of Facebook and extremely healthy margins. They are very different businesses with different longterm prospects, but why is one worth ten times more than the other? Something is out of whack. Maybe both are overvalued.

Remember also that private valuations are based on what a handful of wealthy investors are willing to pay—in this case Goldman Sachs, which has other motives as well. By plowing in money now, it moves to the front of the line to manage an eventual IPO. And it has the option to sell a portion of its stake to DST, as well as to sell $1.5 billion worth of shares to Goldman clients through a “special purpose vehicle” designed to skirt the SEC’s 500-shareholder rule, which is when public-level financial disclosure requirements normally kick in.

At $50 billion, though, Facebook is going to have to come out with the biggest IPO in history to justify the current frenzy of private investment. Google’s initial market cap was only half that amount.


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