Tyler's Toolbox

I had lunch with a buddy last week and he asked me what I thought Facebook would do about mobile location. I told him that I had no idea, but that I know what I’d do in their place. So on my flight home, I wrote this, intending to email it around – but, since the talented MG wrote about Facebook’s location plans on TechCrunch today – I thought this might be interesting to more people. It sounds like Facebook isn’t taking the route I lay-out below; I’m excited to see what they do instead!  If you want to read about Facebook’s actual strategy, check out MG’s article linked above and Ian Schafer’s article in AdAge today: How Facebook’s Geo-Networking Plans Will Change Everything.

Facebook has ~500 Million users and an interest in getting data they can target advertisements against. This gives them a very good reason to get into the location game. However, competing directly with the likes of GoWalla or FourSquare seems an inefficient way to complete this goal. Their goals are two-fold: creating an experience users love and collecting good data that advertisers can use to more effectively target their ads.

There are four things Facebook could do together in order to accomplish this:

1. Incentivize mobile location companies to tie location data to a user’s Facebook profile and to share that data back to the network.
2. Create a compelling experience for users around location data that’s complementary to other mobile location players.
3. Turn user check-in locations into targeting data available for advertisers.
4. Sell ads targeted to passive users (Brand Advertising) while letting mobile location companies sell ads that target users involved in a direct experience (Direct Response).

I think each one of these steps requires a decent amount of space to properly detail (which I hope to sit down and do at some point), so for now I’ll paint in broad strokes.  Companies like GoWalla and Foursquare are quickly acquiring new users, but their biggest need is generating more users. Location is a network effects business, effectively making this a heads-up, winner take-all battle.

Incentivize Data Sharing

Companies are already using Broadcast networks like Twitter and Facebook – MyTown (another player in the space) rapidly grew to 1.5M users using viral channels on Facebook. Solid utilization of Facebook could give a location player an advantage in the war for users. If Facebook built a complementary business around location that helped those companies increase adoption, it’s likely many of them would take it (and give Facebook access to its location data).

Create a Compelling Experience

Facebook isn’t going to mess-up the user experience in order to unlock an additive amount of advertiser value – but getting location sharing right represents a serious improvement to user’s lives. Here’s how they could do that:

1. Create a data point about a user that represented their most-recent location (call this: “Location Status”).
2. Allow users to update using standards status update with special syntax: (i.e. “I’m at” @[Location] [contextual information])
   • Also allow users to connect with a service to update this (i.e. let GoWalla update my fb location)
3. Surface Location Status in proper ways on the site (box on profile, stream updates, mobile subscriptions)

Facebook should protect the UX and Privacy settings in order to stop malicious platform applications use this data, and each user should get full control over how they share location (on profile, in newsfeed, and/or allowing friends to subscribe to — or request subscription to — mobile updates) as well as who to share it with (allowed applications and friend lists).

The location status update should include prominent reference to the update source, which would create a viral distribution channel to act as an incentive for location services to encourage users to allow them to write to the location status. Facebook could clearly communicate their strategy re: competition and hopefully win the trust of location players — Location Services are invested in several things:

1. Building great user experiences around checking-in
2. Creating databases to turn machine co-ordinates into user recognizable locations.
3. Addictive mechanics to keep users coming back

These companies could easily compete against the “Location Status Update” user experience provided by Facebook, and own the check-in. As long as Facebook clearly indicated that they’d prefer third parties owning the check-in (and having a direct relationship with the user), Location Service companies can decide for themselves whether the additional viral channels is worth sharing data with Facebook (a competitor in ad dollars)

My guess is most will do so because user adoption benefits them in such a competitive market, but some won’t because they don’t like sharing valuable/proprietary data with Facebook.  Facebook gets data for enabling the growth of partners, and users have an easier way to share location and connect with friends.

Turn check-ins into targeting data

This would let Facebook know a place’s name and location on a map from the check-in – but they have to invest in creating advertiser context. If they know I check into “Epicenter Cafe” on foursquare, Facebook has to figure out what that says about me that advertisers might want to target against. Here are some examples of valuable targeting criteria you could extract from check-ins:

• City/Neighboorhood
• Category of establishment
• Social Graph Representation (does that location have a facebook page, for example).
• Etc.

Two different advertisements

Facebook’s ads are setup well to be persistent and targeted rather then presented in direct context – so they’ll enable those demand-gen type of advertising programs.  Location services can focus on highly engaging and contextual monetization programs (like sponsored badges, loyalty programs with establishments, geo-targeted offers, etc.).

Taking this into account, it’s likely that Facebook could exist peacefully with several different location services. It’s likely that those players would be either focused on loyalty programs (huge market) or be smaller companies. It’s also worth noting that

Worth Noting:

• The Zynga/Facebook fight going on right now is the biggest danger to announcing a program like this.
• Foursquare, in particular, would likely be very unhappy about this, With their fundraising and valuation they would have a hard time justifying giving data away to a potential competitor for location based ad programs, yet they can’t afford to fall behind in user adoption  for their product.
• Presence was the coolest thing at F8 – the folks that put that together have already shown you some of the amazing things that could be the early version of the location status update formats. If Facebook wanted to go this alone, they could be VERY competitive, but I think they don’t need to use the resources for this.
• Facebook looks like it wants to go head-to-head with check-in services. Facebook wants to encourage every user on their service to be a mobile user (mobile users are more active and less likely to leave), this alone may be enough of a driver to launch their own check-in service. As well, they may want to extract more advertiser value and try to launch a contextual advertising offering at the point of check-in.

I had a good conversation this afternoon with a friend who works at Google, and we touched on ideas about how the world of search and the world of social might collide.

We agreed that no one’s going to beat the established players in search, and if/when an entrant does beat Google, it will be with a disruptive technology that uses a very different method of information discovery. Executives at Google have all read Innovator’s Dilemma and they are rightly concerned that real-time search and social search (and soon, geotagging) could represent this disruptive technology within search. The company is focused on how those movements might interact with search and have experimented with including real-time content in search results.

I’ve got several ideas on how real-time and social data could affect search, in particular, the conversation reminded of an email chain I had contributed to this summer; I’ve pasted my bit below:

Here’s a more complete description of the search idea I mentioned to you today.  Aside from some of the interesting strategies available to the big 3 search providers, I think Facebook has an opportunity to play an interesting role in search by offering a service adding social data to search results.

Facebook could offer a Facebook Connect implementation specifically for search engines that allowed them to check URLs against a database of friend’s posted links.  This would allow the search engine to enhance relevancy. Think of it like this (forgive the quick/ugly mockup):  http://skitch.com/tylerwillis/bswcr/presentation2

This could help Facebook move the needle on three strategic goals: increase engagement, increase ubiquity of graph availability (connect), and user growth.
- Offers a quick/easy way to gain influence in a new area of user’s habits, namely search.
- Easily the biggest Connect implementation to date if done with Bing, Yahoo, or Google. Huge legitimacy marker for Connect’s capabilities.
- It offers a large, visible step towards FB becoming ubiquitous, which would have a positive effect on new user signups.

It would be great to make a launch partner of a top-notch engine (Bing or Google). Biggest problem would probably be building something that served results fast enough for Search Engines to actually use.  Only real question I can come up with is whether Facebook would be willing to be part of a search solution of companies they see as competitive (Google specifically) – IMO, the benefits laid out above outweigh the costs of propping up a future competitor’s current solution.

Bottom line: John Borthwick sees an oncoming verticalization of search; my answer to Borthwick’s claim is the part of my argument I hold most tenatively, but, for most people, I believe that content isn’t interesting just because it is now, social, or nearby; our information discovery platforms must still apply good filtering and context to it’s content/results to meet a user’s needs. Anderson’s Vanishing Point Theory alone isn’t enough to build a universally interesting news application — one has to apply other metrics to judge it’s interest to a reader. Innovator’s Dilemma has shown us that the disruptive technology will get there soon enough (Individual services building upon their success with consumers who care a lot about now/social/nearby and getting better and better at relevance for the mass market), but it’s also shown that large organizations can adapt to disruptive technology by either buying a smaller organization that’s kept independent and encouraged to continue growth (Youtube, attempted with Twitter) or by pushing an corporate shift despite likely stiff internal/organizational resistance. Google failed to buy twitter, therefore it has to push forward with the latter option.

Using the type of UI displayed in the rough mockup I included in the email (link), Google could add social (or realtime or location) data as a contextual meta-layer. I can tell that Google is already thinking of this meta-layer, because it’s exactly the layer that sidewiki is writing to (conversations occuring about information found at a website address). But, Google has misstepped with Sidewiki by trying to own the input. Our conversations are fractured, and occur all across the web, Google should instead focus on indexing and storing data from other services (Twitter, Facebook, etc.) and using that information to display that content as a meta-layer on top of search results and/or to reorder search results. Luckily for the goog, they’ve got some experience with indexing and displaying content from disparate locations.

This idea is complimentary to my opinion about bit.ly being a great asset for a search engine to pickup.

…is something my dad used to say all the time when trying to corral the dispersed Willis children into giving up their “way to busy for family” lives for a few days and making a communal trek somewhere for a very untraditional Christmas. We were usually pretty successful in making this holiday a fun one, but that’s neither here nor there, since I’m not going to be talking about any of that in this post. It’s just a nice story.

Instead, I want to talk about presence as it pertains to recording who you are online. I’m not talking about branding or building reputation here, but rather presence in the most pure expression: participation. As Malcolm Forbes once said, “Presence is more than just being there.”

Just as a sulky family member at Christmas is worse than an absent one–an online friend who seems uninterested in interacting with you unless it benefits them, worse then someone who abstains from hanging out with you on the interwebs.

I love when people create a hub for you to look for interactions with them. Some Examples:

• My friend, Andrew Hyde, lists very clearly on his site most of the things he’s working on (Startup Weekend, VC Wear) and provides a good bio and links to his profiles on different web services. If you spend 20 minutes on his site, I guarentee you’ll find something to strike up a chat with him about next time you see him.
• My friend, Ben Casnocha, has a slightly more “company” version of essentially the same thing. He’s a little more conscious of creating a brand for himself so the site reflects that. At it’s core it’s similar to Andrew’s site, a hub for “all things Ben.” You can find out what he’s thinking about from his blog, find his accounts (twitter, FB, del.icio.us, etc.), even sign up for a newsletter digest he send out (which is very good incidentally).
• New Friend, Amit Gupta, will probably serve as inspiration for me in building this site. He hosted smaller projects on his domain, instead of a separate domain. Talk about centralization! Of course, once projects hit a certain size, it needs to be spun out, but while it’s a baby idea – why not let it live at home?
• This site now has tons of information about me. Not sifted, carefully chosen and cleared information – but rather a bevy of information about who I am and what I do. So does my Facebook profile.

So, if real presence is equal to participation — it only makes sense that your online presence should reflect all your participation. I used to think it was a good idea to create a separate corporate web page that can be separated from my personal page and cleaned of any personality so that I can be sure I’m not making the wrong impression, but likely because of that I ended up making no impression at all.

The alternative is, I can build a hub that is open, inviting, and full of possible talking points that may drive interactions. That’s how I’ve decided to go about it this time around.

I’ve created this as a web hub, and while it’s not complete, tonight I am working on building a Facebook Hub using pages. Since I use Facebook so frequently, it seemed logical to have an aggregation of data like events, groups, stories, etc. using one of FB’s most robust tools. So here’s my page, it should stay up to date with community projects I’m working on and events I’m putting on. Fan me on Facebook if you want infrequent updates about this stuff.

I’ll continue to build out both my Facebook page and this website with as much information as possible, until I’m documenting almost all my online participation, as a way of extending my digital hand to you for what might be the start of a beautiful future.

Brad Feld>Fred Wilson>Me

Fred Wilson posted about “The Facebook Problem” in response to Brad Feld’s concern about Facebook’s new Application layer not showing much immediate benefit for those developers building applications.

Brad Says: “In the absence of [ad-revenue sharing], Facebook is going to need to address the “value to the apps developer” quickly, before some of the larger apps vaporize due to the developer saying “I’m not willing to keep paying for servers and bandwidth.” “

Fred Says: “I see a different Facebook problem. Invite overload and application noise. I cannot keep track of all the invites I am getting, both the standard invites and the application invites. And what’s worse, I can’t keep track of all the applications that all of my friends are using.

We all know I am not the Facebook generation. So maybe I am just not capable of dealing with this level of social networking. But I bet that many of the members of the Facebook generation are secretly wishing for the old Facebook where it was more about them and their friends and less about being a social operating system.”

In response to Brad I brought up the success of iLike: 6m total users in 8 mo. More than 4m have come in the last month, most from their facebook application. Their CEO is not worried about monetization. In an interview he said “There’s no way we’d try to fight an uphill battle against what’s best for the consumer. And fortunately, in contrast to the precariously-balanced “Myspace widget ecosystem,” making $ on the FB platform is no harder than making $ on our own site.”

In Response to Fred I drafted a comment, which I shortened and posted to his blog. That comment turned into this post:

I suppose that unfortunately, I’m in the “Facebook Generation,” I have 3 thoughts that may contribute some value to this discussion.

1) I resisted facebook for awhile, thinking it was silly. One of my friends tagged a photo of me and that was enough value to join. I just throw on a “noise” filter and it’s very nice. I can keep up with people I met while traveling in Europe, or from high school, from my hometown, etc. I ignore everything else and after 5 hours I’d found all those I wanted to find. Now all things I want to see get emailed to me (I made plans for tonight and saw a friend was coming home while drafting and proofreading this comment), and management takes very little time. Applications increase the level of information I can see about my friends. Nothing regarding them gets pushed to me though, it’s just there when I seek it out. I like this.

2) Quote Generator, Free Gift, Pets – I agree these are fluff applications with little value other than social interaction for social interactions sake. This helps college kids have sex, it will always exist! BUT, facebook exists as the primary online brand for most of my peers. 10% of my network have websites/blogs (most also have facebook or other social profiles), 75-80% of my network has a facebook or a myspace page. I have a desire to define myself online, so I’m redesigning my website to continue to house my blog and also use widgets to converge all my major online published material and control the presentation of it. Facebook Apps like last.fm, del.icio.us, twitter, etc. are essentially widgets and allow that 80% of my network to exercise similar control over there definition/brand online as those who code their own website/blog. If you doubt the value of widgets to some people, just look at the sidebar of Fred Wilson’s Blog. Of course not all 80% of my network that uses facebook find widgets useful, but more than the 10% that also run personal sites/blogs will have use for widgets. This brings me to my third idea.

3) Facebook users are experiencing an exploratory phase. Most users are not entrenched in the Web 2.0 world, this applications program is arguably the first time many of these users have seen these ideas of widgets (and also the “web2.0″ services that are easy to build but don’t actually provide much value — we all know that the vast majority of “web2.0″ isn’t useful). Facebook users are doing what all people do when placed in new circumstances, they are exploring. This I say with relative assurance because in just reviewing my notifications – my friends are removing applications just as fast as they are adding them. The quotes, the pets, the “hangouts i like” apps don’t stick around much. The last.fm, twitter, and other “established services” apps don’t get added much but they never get removed (I’m inferring from this that only current users of the services are adding these widgets). The iLike phenomenon is the most interesting, iLike faces a lot of entrenched competition and is still pretty young (8 mo. old). It now says it has between 6 and 7 million users, 3.9m of which have signed on to the facebook app in the last month. More than 4m have joined in the last 30 days. I’ve had many friends add this app and some remove it. It’s my educated guess that most of those friends hadn’t heard of iLike before the application, so everyone who still has the app is a brand new user for iLike. That’s good news for the users that found a useful service and it’s good news for iLike. It would be of interest to see the metrics across the FB network of adding and removing applications. I’m dealing with a limited sample group.

Broad Level Takeaways:

To those who are disappointed with the “noise level” – the info-noise level will continue to be higher than previous levels, but you are now experiencing an exploratory spike which will calm down as people begin to realize what apps are and what they do. The same reason I don’t email my friends when I sign up for a new service just because it asks me to, your friends will learn that they need 3 days to test drive an app before saying they like it. Most will learn to stop notifying you, unless they think it will provide value to you, and in that case wouldn’t you want to hear about it?

To those who think facebook needs to help developers monetize apps: You’re both right and wrong. Facebook benefits in two ways from the applications…
1) Users like me get more information in many ways. Apps like Video and events help address competition with options available on Myspace, without having to alienate anyone who’s not interested in changing their profile or interface. Apps like notes help users publish data for their friends to find if they want to (facebook blogging anyone? “flogging” if you will). Apps like Twitter, Last.fm, Dopplr, etc. mean I don’t have to publish information twice to share it with a wider facet of my network. It also changes how I use these services, normally for the better. Synergistic! This doesn’t require Facebook to help with monetization. Certain developers will take the risk that they can monetize the traffic. Any new app is only an added value to the userbase, and the critical features are built and maintained in-house.

2) The Marketing Playbook (great book; worth the read) details 5 strategies a software company can take. One strategy is the platform play, in which a company gain numerous allies by empowering other companies to survive in an eco-system they create. This could be a powerful move for Facebook. Empowering other developers is a great move, especially when it so perfectly fits into your core business. If they do help companies like iLike succeed and even allow companies to move to FB and turn a profit (like it sounds like iLike may do), then they have something unique, extremely valuable, and a huge win for them.

Thoughts? Responses? Comments!