Is FACEBOOK the answer to effective advertising on YouTube?…..Part 6
Enter Facebook.com. I’m going to assume that you have a basic knowledge of what Facebook is, but I will go into a little bit of detail as to what Facebook means to companies like Microsoft and Google from the standpoint of aggregating information about its users.
The “low down” on Facebook users as per: http://www.facebookmarketingforprofessionals.com/practice_areas/facebook-usage-statistics.cfm
- More than 100 million users log on to Facebook at least once each day
- More than two-thirds of Facebook users are not college students
- The fastest growing demographic of Facebook users is those who are 35 years old and older
- The average user has 120 Friends on the site
- More than 1 billion pieces of content (web links, news stories, blog posts, notes, photos, etc.) are shared via Facebook each week
- There are more than 30 million active users currently accessing Facebook through their mobile devices.
These numbers and statistics are rather staggering in some cases but what is even more important to keep in mind is that the average user puts information on Facebook about themselves that even their mother doesn’t know. It is safe to say that they have probably never put this information voluntarily anywhere else on the web before. In the FaceBook forums people discuss relationships, friends and family, things they love to do and even more importantly what they are doing at that moment. This is not to say that the information is totally accurate. The things placed on Facebook by the users about themselves could by definition be considered propaganda in its truest sense.
(This was pointed out to me by a podcast done by the StuffYouShouldKnow team http://blogs.howstuffworks.com/category/stuff-you-should-know/ )
The user has total control and puts on Facebook only information about themselves they want and choose to share with others. Taking the propaganda factor into account, there is most likely more information about that person on Facebook than on any other site or aggregator of “user specific information” on the web to date.
Facebook represents the ideal, indexed and categorized repository of user specific information that Google could use to match-up content with advertising for the users of YouTube. Allowing it to show ads that the logged in users would be interested in and thereby increasing the revenue those ads generate by untold percentages. Maybe even allowing them to make a profit with YouTube.com.
And there you have it, all that just to say Facebook has got the stuff Google needs to make YouTube profitable. I guess the big question is how much would Facebook.com cost Google and if you divide that by the number of days in a 4 year period is it worth it?
Can Google afford to wait to leave a door open for a competitor such as Microsoft and the new yet unproven search engine Bing.com?
I don’t think so.
Is FACEBOOK the answer to effective advertising on YouTube?…..Part 5
Now if you will, let us take a step back from the “1984” paranoid view of Google to the charges of it making money. Sometime ago Google bought YouTube.com for $1.65 billion. http://www.google.com/intl/en/press/pressrel/google_youtube.html
Google did this and in true Google fashion chose not to charge for people using YouTube to view, upload and store videos. It was free for everyone and it was good for everyone, except the video hosting websites that charged money. After some time analysts started to crunch numbers to see just how much YouTube.com was costing Google to maintain? Estimates came to an astounding $1.5 million per day.
http://www.internetevolution.com/author.asp?section_id=715&doc_id=175123
If we think of YouTube as nothing more than an expansion of the “Google Funnel”, an effective one but an expensive one nonetheless, then the Google- YouTube matchup is ideal regardless of what any analyst says. It is safe to say that Google’s cost to maintain YouTube will only diminish in accordance with Moore’s Law as time and usage goes on.
http://en.wikipedia.org/wiki/Moore’s_law
A $1.5 million loss per day is nothing to just brush off though, this realistically equates to the sinking of 12-15 small businesses per day, every day and that makes my skin crawl. So the question is how does Google make money from YouTube? Simple, they make money the way they do best……they advertise. The really big fly in the ointment is that the $1.5million loss per day already accounts for their advertising. They have not been able to effectively pair up advertising with content searches on YouTube like they do for searches done directly through Google.com. This poor pairing of content and ads is caused by numerous reasons but the primary one is that Google doesn’t know enough about us or why we are searching for videos to accurately match up video content to our personal preferences for products and services. Google is slowly building a database of this information based on our Gmail/Google accounts in conjunction with our Google searches and general web usage, but that takes time and when you’re talking a loss of $1.5 million per day, time definitely costs money. Google needs specific information about who we are, what we do, who we like, what we like and how often we like it AND they need it now not 4-5 years from now.
To be continued…..
Is FACEBOOK the answer to effective advertising on YouTube?…..Part 1
There is no argument that Google is the 800lb gorilla on the Web, but there has been some talk that they might be challenged and given a really good run for their money by a company such as Facebook or Microsoft.
Take a look at this article that appeared in Wired Magazine in June of 2009 showing some of the strengths and weaknesses between Google and Facebook.
http://www.wired.com/techbiz/it/magazine/17-07/ff_facebookwall
While I don’t particularly agree with the author on some major points made, I do think there are reasons Google should make a serious effort to buy Facebook if even for the sole purpose of customized advertising.
To get one’s arms around the whole of this issue we should really bring up some history and major points leading up to now.
Background on the challenges facing Google and YouTube:
-How Google makes $$
Google makes money by paring up advertising with the keywords a user inputs to create a search. If I search for “stinky cheese” on Google I will not only get information about smelly cheeses but I will also see keyword based advertising on the right side of my screen for Land O Lake and Cracker Barrel cheeses.
The Good: I will not only learn about Gouda cheese from informative cheese fanatics and their blogs but I will be presented with places that sell stinky cheese locally and over the web. Essentially I get all I could ever hope to learn about stinky cheese and where I can buy it from around the world.
The Bad: Well I really can’t think of anything bad about Google’s process of giving both information and a place to purchase what I searched on. In the past this practice of paring up information with ads would be a bad thing and a frowned upon practice for printed media. For example if I was reading an article in the Sunday news about smelly cheese and its life extending effects on humans only to see a half page ad for a local cheese monger at the end of the article telling me about a huge sale going on NOW! In this context I have to admit I would view the article I had just read with some skepticism and question if its information was truly unbiased or just an elaborate ad created by the news paper. When the same pairing of content and advertising appears in a Google search result I have no issue with it. Why we have shifted our perspectives this way I am not sure. I have not read anything that conclusively defines the cause behind our not trusting printed media paring content with ads but trusting Google when it does the exact same thing.
To be continued….