Just saw Facebook talk at Graphing Social Patterns. It was basically a 45-minute ad for Facebook ads! Drill down on their hyper targeting mechanisms, performance, etc.. As the speaker said, Facebook is an advertising driven business, so they walked us through their focus.
I think Facebook completely missed the boat here. First, this is a geek conference. They should have given this presentation at Advertising 2.0.
Second, I think this is not actually the optimal strategy. What are they doing to help people using the platform make money! Developers, developers, developers. To justify a $15b valuation, what they need is an ecosystem. They need multiple billion dollar companies using their infrastructure and then a tithing system to take a slice of the revenue. To really scale, rather than focusing on selling their ads, they should focus on enabling people to sell their ads.
I love Google’s announcement that people can sell their own Youtube inventory. Obviously, they are headed in the completely opposite direction by engaging the masses to make Google money. Conceptually, they have the right strategy. Tactically, they could still blow this – the minimum deal size of $10k seems to fly in the face of the validation Google has gotten around building a long tail of advertisers and publishers. The smartest thing about this deal is that the concern with selling Youtube inventory has always been dicey content. If people sell it themselves, then they represent their own content and ensure quality. That essentially gets Google out of the quality discussion by having the inventory manage its own quality. A slick solution to the problem.