[crosslinked from LinkedIn]
As someone steeped in social media, I’ve been watching each of the presidential campaigns closely to see how they are using social media well – or not. [Disclosure: I worked on Obama’s campaign in 2008 and have donated to it this election season. I also went to the same high school and business school as Romney. To the extent possible, I’ve tried to be objective in my analysis, but inevitable, my biases will come through.] Here are some observations, as well as opportunities for the future:
The key for Romney in these closing days of the campaign is to tap into his loyal base on sites like Facebook and Twitter to share with their undecided friends the Mitt that they know and believe in. But socialgraphics – the social behavior of key audience groups – are stacked against him. According to Pew, only 25% of Republicans are likely to recruit people to get involved with political issues that matter to them, as opposed to 35% for Democrats. But even worse, social networking site (SNS) users (84% of SNS-using Republicans and 79% of SNS-using Democrats) say little or nothing of their recent posts have anything to do with politics.
My takeaway from this analysis is that while the campaigns are using social media in creative ways, they both still miss more opportunities than they capture. The biggest is that neither has created a culture of sharing with their followers. Activity is still focused on messaging, and a predictable call-and-response routine of asking for donations and the cash register singing.
In the end, votes win elections. With a dismal 58% of the US eligible voters actually voting in the 2008 election, the campaigns could be doing so much more to engage people in a dialog, encouraging us to share our views not on politics but the issues we care about. But in the polite company of our friends, we do just the opposite and hide our political leanings from each other. My hope is that in the waning days of this election cycle that more of us will be inspired to engage in civil discourse directly with each other, in the social channels that we inhabit.
by Charlene Li and Chris Silva
Google announced Google+ for Enterprises today with Hangouts integration into Docs and Calendar as well as administrative controls such as default posting to only within the company. We’ve been doing some research on the topic of enterprise social networks and, with Google moving into this market, have some thoughts around why this is a bigger deal than just another Google feature announcement.

Google has a few things going for it that the pure plays like Yammer and Socialcast in this market don’t have and that tools like Microsoft’s Sharepoint have not yet built out:
Will Google+ for enterprises save the oft-maligned network? We think that a better way to think of this is what Google+ for enterprise reveals about Google’s intentions for its social efforts. Google+ doesn’t seek to be the biggest social network or the one where people spend the most time. Instead, Google+ seeks to be the most embedded social feature in the lives of its loyalist users so that they will never want to leave Google.
Look at Facebook’s biggest problems — it needs to constantly innovate and offer new features to fight off upstarts and retain its users. LinkedIn struggles to get people to even come to their site for more than a few minutes a month. Google+ isn’t a destination — it’s a ubiquitous presence that’s always there and now all the more so if you’re a Google Apps user. This is about social being where you need and want it to be — it’s social being like air.
Do you think Google+ for Enterprise will make a difference against competitors? Do you agree that it makes Google+ more relevant — or will it have little impact? We’d love to you know your thoughts so please share with us!
Microsoft announced that it would buy Yammer for $1.2 billion, after a week of speculation that the deal was imminent. From my perspective, having researched the enterprise social networking space (see report), the acquisition is a continuation of current trends in the industry and makes a lot of sense for both MSFT and Yammer.
Yammer CEO David Sacks wrote in a blog post about the acquisition, “When most people thought social networking was for kids, we had a vision for how it could change the way we work.” When Yammer launched at TechCrunch four years ago, it won the “best in show” award from judges and it’s been on a rocket ride since then for two simple reasons — it’s free and people love using it. The result: 85% of large companies have Yammer inside their walls.
That love-driven virality is a key reason why Microsoft bought Yammer — after all, who would use the word “love” to describe Microsoft or a product like SharePoint? The fact is that Yammer and its competitors are creating new way for work to get done, that is not only effective but also — dare we say it — makes work fun. Microsoft knew that it was behind in the enterprise social networking space and could either build organically within SharePoint or acquire. I think they did the smart move by buying Yammer as it gives them not only the largest independent player, but also penetration into virtually every company that already is using its products.
The challenge going forward is how Microsoft will integrate Yammer into its Office offerings, in particular, SharePoint. Yammer already enables integration with SharePoint that inserts microblogging capabilities right into SharePoint, making the enterprise app much more social. Up to this point, the main selling points of ESNs has been that they just had to be better than SharePoint’s built-in social tools. That is no longer the case, so you’ll see other enterprise apps companies scrambling to snap up remaining players like Moxie. Here’s a graphic from my ESN report from February that shows how the world (used to) stack up in terms of players — this is a game being played by the big enterprise players now.
While there is concern that adding Yammer makes worse an already-confusing mix of Microsoft offerings, it’s nothing compared to the bewildering situation facing CIOs when it comes to ESN. One CIO shared with me that he faces a situation of having Salesforce’s Chatter, VMWare’s Socialcast, Yammer, and SharePoint all running within his organization. And that didn’t include rogue installations of Box and Google+.
In the end, it makes sense for each company to have one — and only one — enterprise social network in order to ensure universal access. Thus ESNs like Yammer become battlegrounds in the way that other foundational enterprise tools like email, IM, and CRM have become. In this way, Yammer makes a whole lot of sense for Microsoft, as it becomes more integrated into all of its offerings, rather than remain a standalone. Here are some examples:
By Susan Etlinger, Charlene Li and Rebecca Lieb
The run-up to Facebook’s IPO reminds me a bit of a wedding: everyone’s attention is on the big day (expected to be Friday May 18), without much regard for the weeks, months and years afterward. Charlene Li, Rebecca Lieb, and I sat down to discuss some of the implications of a newly public Facebook: on shareholders, business and Facebook itself. — SE (Cross-posted from altimetergroup.com.)
Whether or not Facebook’s IPO ends up being one of the world’s largest (this Washington Post article places it 6th, between AT&T Wireless and Kraft Foods), it will certainly earn a respectable position in the history of the public markets, a lofty spot for an eight-year-old company in a relatively unproven business.
We identified ten areas where we are watching Facebook closely, as an indication of its success in the future. We picked these topics because they intrigue us, because they provoke discussion and, ultimately, because we believe they are the issues most central to Facebook’s future.
#1. Leadership
In a media frenzy in which anything (such as, for example, wearing a hoodie on a road show) can spark a news cycle, it’s to be expected that Mark Zuckerberg would have kept the lowest possible profile during Facebook’s quiet period. But now during the roadshow, on the first day of trading, and afterwards, he’ll need to step out, step up and set the tone for how he will lead this company into its next major phase. Can he pull it off?
The decision Zuckerberg must make, as a CEO who’s famous for his a “go away; we’re working on it” attitude, is whether he will use this milestone as an opportunity to cultivate his newest constituency: investors. As CEO, Zuckerberg needs to be accountable to his shareholders–not to a stock price per se, but to their faith in him. We will start to see clues to this decision during the first earnings call (a trial by fire for any CEO of any newly public company).
Of course, it’s all fun and games until there is a major hit to the stock price. We know, generally speaking, what the triggers will be: a new, poorly received product, a privacy issue, slowing user growth–the registration statement is full of examples. When this happens, Zuckerberg will have to demonstrate a completely new level of leadership. He’s chosen his executive team wisely in that both COO Sheryl Sandberg and CFO David Ebersman are strong, respected executives who have been through this process before. And, despite his youth, Zuckerberg has learned from previous missteps like member revolts, privacy, and Beacon. If you still wonder if Zuckerberg is ready for prime time, imagine how you’d react if a major, highly unflattering motion picture had been made about you while you were still in your twenties. The issue isn’t if he can avoid controversy, but how well he can quell the concerns of skittish investors.
#2. Innovation
Facebook has a hacker culture; its development mantra, “done is better than perfect,” is at the root of both its growth and its biggest failures. Given the massive number of monthly active users (901 million according to the latest released numbers) the strategy has been to release product to the market and learn as it goes.
But as a public company, Facebook will need to choose whether it will continue to release products the way it has in the past or take a more cautious approach. How will it behave when it’s not just the pundits on Twitter, but the shareholders who react?
Although they’d hate the comparison, there’s a strong role model in Google, which, even as a public company has managed to maintain its agile development strategy. Granted, there’s always the risk of a Buzz (Google) or Beacon (Facebook), but Facebook has demonstrated considerably more focus from the start than Google. Furthermore, the company sent a strong signal in its last quarterly statement that it will continue to make investments for long-term growth, even at the cost of short-term profits. It’s setting expectations that it’s investing for the future, not just for the quarter.
#3. Brands
Will brands buy what Facebook’s selling? Facebook is, after all, a media company, and while it has other sources of income through partnerships, brand dollars are what will ultimately make not only the IPO, but the company itself, succeed or fail. With close to a billion users, Facebook is the biggest media company that’s ever existed, in any medium, ever. Advertisers go where the eyeballs are, which is Facebook’s undisputed advantage. After that, it gets a bit trickier.
Facebook is at the vanguard of developing products that merge and conflate advertising and marketing, that blend content, conversation, paid, earned and owned media with media buys. Advertising is media buying, but those other aspects: owned media (premium brand pages) and earned media (the conversations and comments and interactions brands have with their fans, users and yes, detractors) are part and parcel of what Facebook is working to monetize. It’s still experimental. Brands are still testing the waters and are far from establishing best practices or firm models in a “brand” new environment.
#4. Data
Facebook is also in a position, thanks to its staggering user base, to possess and be able to leverage data on a scale we’ve never before seen. Likes, affinities, social graphs, recent behaviors – it’s all there, together with the basic demographic information. Again, the ability to package, parse, productize, make understandable and actionable this vast quantity of data is as formidable a challenge for Facebook as it will be for the media agencies who buy against these very new models. Facebook’s potential as a marketing data juggernaut is very real, and can potentially take advertising to new levels, if the company succeeds in making that data useful.
#5. Mobile
Most of the coverage around mobile has been focused on Facebook’s “lousy” mobile applications. But we believe this is a red herring – the core issue revolves around the slow development of mobile advertising and marketing. The S-1 says it best in the section on risks related to advertising:
§ “…increased user access to and engagement with Facebook through our mobile products, where we do not currently directly generate meaningful revenue, particularly to the extent that mobile engagement is substituted for engagement with Facebook on personal computers where we monetize usage by displaying ads and other commercial content…”
But with 85% of revenue coming from advertising as of the end of 2011, the more effective Facebook is at appealing to its mobile users, the more it risks shifting revenues from the Web platform where it can monetize users, to the mobile one where it can’t — at least not immediately. So the real question becomes how Facebook will balance creating mobile user value against driving shareholder value.
Facebook can’t risk waiting too long before moving aggressively into the mobile space, but also needs to buy time to help mobile advertising develop. Given this significant risk, the purchase of Instagram represents $1B of earnest money that Facebook is focused on the long term. With the war chest Facebook will have accumulated post-IPO, building a great iPad app and upgrading the smartphone experience is a foregone conclusion. The bigger issue to watch is how well Facebook can develop the mobile advertising market with that experience, in a similar way that it created social media marketing.
#6. Investors
The first earning call is always rough for a first time CEO, and Facebook will likely not be any exception. But what we are watching closely is if Facebook will develop a different kind of relationship with its shareholders. The company is, at its essence, about sharing: will a newly public Facebook use its own platform to share more information with investors? Facebook has an unprecedented opportunity to change the way that it handles investor relations. Will it take this opportunity, or will it stick with the tried and true? We’d love to see Facebook use its own platform as a way to engage with and provide greater transparency to its newest stakeholders: the public markets.
#7. Mergers & Acquisitions
Thanks to Instagram, every venture-backed start-up has dreams of meeting with Facebook’s M&A team. Will Facebook focus on smaller acquisitions to acquire talent or smart ideas, or will it make major deals to really move the ball forward?
One of the more interesting areas of speculation lately is what would happen if Facebook were to buy Bing from Microsoft. With Google arguably its most formidable competitor, the addition of search would give Facebook advertisers a direct response medium they could not get before on Facebook. Google is, at its essence, a search company that has struggled with social. Facebook is a social company that needs search. A Bing acquisition would up the ante in a significant way between Facebook and Google.
Looks good on paper, but acquiring Bing would also be a huge distraction and a departure from Facebook and Zuckerberg’s legendary ability to focus on social sharing. A more likely scenario is that Facebook and Microsoft continue their long-term strategic partnership, integrating Bing deeply into the Facebook search experience.
Regardless of whether it buys Bing or another organization, few companies do the “merger” part of M&A well. We expect that Facebook will focus on smaller acquisitions that it can absorb and leverage quickly, while any large acquisitions like Instagram will be kept running separately, in much the way that Google ran YouTube as a separate entity for years. Again, a focus on the long term gives Facebook the ability to look at M&A in a very different way than traditional companies who much justify every single penny spent on a company.
#8. Culture
Facebook is a private company in many respects (one of which is about to change dramatically), but the internal culture has always been very open. It has invested heavily to create this open culture, and it has slowly but surely been reducing the amount of information shared internally in the run-up to the IPO.
This will only increase, as the company will now be beholden to even more securities industry regulations intended to protect investors from selective disclosure. So again the balancing act, this time between employees (and openness) and shareholders (and fiduciary responsibility). Which leads us to…
#9. Talent
Once it goes public, how will Facebook retain talent, especially top talent? Expect to see the usual exodus as people wait to vest, then cash out (the Bay Area housing market is already bracing for impact). But, again like Google, Facebook will retain its cachet for some time to come, and some will be motivated by the opportunity to change the world from within Facebook rather than from without. Where else can you find a platform of 900M people to try out your next great idea?
#10. Privacy
Zuckerberg has said that increased sharing is core to Facebook’s growth. But with greater sharing also come increased pressures on and threats to user privacy.
Over the past eight years, Facebook has mastered the art of trial and error when it comes to privacy. There have been huge missteps (Beacon), significant improvements (to privacy settings) and escalating tensions as the company has continually pushed its users to share more, and more often, frequently beyond their comfort zones. The company has accumulated a great deal of resilience along the way, and has tried to balance giving people a granular degree of control (at the risk of confusing them) with offering a simplified experience (at the risk of alienating them).
The addition of Timeline, and the emergence of “passive sharing,” raise the bar yet again. A few months ago I installed the Washington Post Social Reader on my Timeline. Now I know that it involves social sharing, but one day when I was in need of a little “mental floss,” I clicked on a story about Snooki’s recent weight loss. I didn’t think anything of it until a bunch of friends and work colleagues started teasing me. There it was, along with comments: “Susan Etlinger read an article: “Snooki Finally Reaches Goal Weight of 98 Pounds – But Has She Gone Too Far?” I was, frankly, mortified. I’d forgotten I was “in public,” and I am someone who is supposed to know better.
Wherever your stance on Facebook’s privacy record, privacy will continue to be a litmus test issue for Facebook. User outrage is one thing; shareholder outrage is quite another. We will watch to see how Facebook balances continued innovation against privacy. Where will Facebook stand when and if privacy issues affect the stock price — will they pull back or forge ahead?
As always, we’d love your thoughts on these issues. What are you watching as Facebook heads into its IPO?
Leading up to Facebook’s f8 conference today, my biggest concern about the rumored new “Read. Watched. Listened” buttons was that Facebook was becoming more and more superficial in its interactions. This was especially the case when compared to the deep interactions and engagements found on Google+ (which suffers from the problem of not having nearly enough people on it to sustain those deep conversations, but that’s another post).
But Timeline beautifully solves this problem in two ways. First, Facebook automates the sharing of everyday, miniscule activities that most of us would never bother to expose. But because ALL of it shared as a feed, the whole becomes available and accessible, and thus interesting. You don’t care that I listened to Billy Joel just now, but you may find it interesting that I listen to him any chance that I get.
Second, the items in the feed are seen in two ways, in the Tickler blended in with all of the rest of debris of our lives, and in Timeline where it’s laid out against the context of time.
It’s this second aspect of the announcements that I find so fascinating, that we now have the context of time to add to our sharing. To understand this evolution and put it in perspective, let’s take a quick look at the history of sharing within social networks. I have long contended that there are three things that make social networks unique: your Profile, your Relationships, and your Activities (see figure below).
Over the past few years, each of these components have evolved. When we first began on our online social journeys, who could have thought that we would be sharing photos of what they were having for dinner online? Yet people frequently not only check into restaurants but also post photos what they are eating, as well as who they are having dinner with. Our notions of privacy and what we will share change with the perceived value of that sharing. We benefit from the people who have shared before us (you ordered the dish because of a review). We like reading about our friends culinary adventures, and so we reciprocate. The cycle continues to evolve as we expand the things we are comfortable sharing.
And the driving force of this evolution has been Facebook. More than any other company, Facebook has pushed the boundaries of what we will share and how share it. News Feed was met with derision and boycotts but in the end, people found it too valuable. Beacon in 2007 was pulled because it pushed the envelop too far, but that was also instructive to Facebook as they learned how far and how quickly they could push the limits of sharing.
Now Timeline and auto-feeding of your activities is pushing the edge again. Understandably, people are uneasy about EVERYTHING in their lives being shared on Facebook. It feels like too much power being bestowed on one company. To ally concerns, Facebook is starting in safe territory. This first phase enables media content, which is rarely embarrassing, as long as you don’t stray into X-rated categories. The discovery benefits of seeing what my friends read, watch, and listen to are also evident – I want to find my fellow Billy Joel fans amongst my friends.
But how far will this go? Here are some future scenarios and applications that could take advantage of an activity auto-feed:
How far are we willing to share our information and activities? Look no further than to our real lives because we do it all the time. Our credit card transactions are captured and resold to direct marketers. Our Caller IDs – which used to be private – are shared. Caller IDs in fact are a great example of how our notions of privacy get flipped upside down by utility. When Caller ID first came out, many people regarded it as a violation of privacy and were uneasy with the notion that people could see who was calling them. Today, what happens when you get the message, “Blocked ID” on your phone? You don’t answer it! That flip in privacy took about eight years to happen.
But Facebook doesn’t have the luxury of years to change our mindsets around privacy – it has weeks. It has put in place numerous controls to be able to manage the permissions around Timeline feeds, from what is included to who can see it. In the end though, what Facebook is investing in is Trust. Pew Internet recently released a report that showed that Facebook users are far more trusting that the rest of the Internet. “A Facebook user who uses the site multiple times per day is 43% more likely than other Internet users and more than three times as likely as non-Internet users to feel that most people can be trusted.”
Facebook is counting that this remains true, and that sharing will continue to expand at the rate it needs to in order to fulfill this vision.