Facebook is being propped up the 2.0 bubble.
Since everyone is talking about the recent $740 million infusion of cash from Microsoft and two hedge funds, I thought I’d chime in.
First of all let’s address the issue of the 2.0 bubble.
The entire hype surrounding social media is the fact that it is now easier to identify influencers and have influencers spread the word. Facebook provides an immense amount of data to make laser targeting possible.
However, People are changing how they use the internet as it becomes more connected and more humanized.
Yet, advertisers are still clinging to age old methods of spamming us with “targeted ads”. Targeting is worthless with out intent. The reason social media’s advertising predictions will fall short is because our social spaces, our communities, are private and we don’t want to talk to you there. Targeted banners on sites like Cnet are somewhat effective because I’m actively seeking out information on a new laptop or camera, but in the social realm I’m trying to connect with other people, not brands.
There is some hope in the form of Branded Utility, which I talked about in my post on Human Centered Communications. I see a great deal of potential with Facebook’s applications as brands can create touchpoints that provide utility to users. However, the hyped valuation is primarily based on targeted advertising, which will fall short of expectations.
That said, I will be looking closely at Facebook’s mobile execution.