Five (Other) Ways for Facebook to Monetize.
I’m not convinced advertising or ‘gifts’ is going to do it. Advertising works best as a funding model when the only metrics are vague numbers that don’t directly indicate an action (see: Print, Radio, TV, Outdoor). Online is too measured, and effectiveness (or lack thereof) is too clear. Ambiguity is a friend to media sales. Ambiguity doesn’t fare well online, especially in social networks.
Five (Other) Moneymaking Ideas for Facebook:
- Charging for corporate Fan Pages (Or more complete feature sets for corporate Fan Pages). While free real estate to users (who are the only value of the service) is the only logical path, why not charge Microsoft or Dell to have a presence that comes with access to a potentially massive audience?
- Charge for placement on a targeted recommendation system for Fan Pages or Events. Having a public launch for a product or service? Why not have it pop up to everyone who lives in the right area, and has related interests in their profile. This is similar to ads, but I’d argue it’s different because it’s using one of Facebooks core features - the event planning / invite system.
- Charge for (anonymized) demographic info. Giving market research firms access to information about interests, locations, usage of the service, age, gender, and education is immensely valuable. This doesn’t need to violate user privacy - no names, images, or identifying information needs to be made available, even generalized info would be valuable for planning purposes.
- Straight up Freemium. In the manner of Flickr, charge a yearly fee for ‘Pro’ accounts that offer unlimited hi-res photo storage, unlimited friends, hi-res video, etc. Don’t reduce the current Facebook experience for the free user, just add the goodies that are probably already in the pipeline for those who are willing to pay extra to have 5000+ friends or every photo they have attached to their profile.
- Implement a Word of Mouth / Buzz Marketing system. Identify the super-connected power users, and offer them free things to try. Preview tracks from upcoming albums, teaser trailers for new films, clips from the upcoming episode of a TV show, etc. Let them be shared among the network, as the users want. Don’t curate on behalf of the power users, but charge companies to use your seeding system.
There are obviously flaws with some or all of these ideas (considering I dedicated a paragraph to each, this is to be expected) but I feel like offering alternatives to the ad-funded non-model that has become the internet venture standard biz plan, is constructive even if it’s not perfect.
