Facebook’s Misguided Strategy

When I first began articulating my theory of behavioral debt, I used some of Facebook’s efforts to branch out of it’s core product experience as an example. The more I have thought about Facebook and my research focus on human behavior and technology the more I realize Facebook is one of the best sources of research for that goal.

The core of my theory of behavioral debt is how difficult it is for humans to change behavior once habits have formed. Many know the phrase, you can’t teach an old dog new tricks. My attempt is a deeper understanding of why you can’t teach an old dog new tricks.

Facebook, is a good place to start when attempting to more deeply understand how a product strategy needs to develop along the lines of the expectation of the product itself. Facebook begins with connecting people, and the job it is hired to do is to maintain those connections first and foremost. Facebook has struggled, and will always struggle to branch out from that core experience. This is why they will never be a payments platform, for example, or a developer platform for VR or AR. There are certainly elements of VR or even AR that fit Facebook’s core premise of connecting people, but what lies at the center of their challenge is a combination of the type of connections its users may desire to use its platform for as well as user trust.

This is why I find the lack of interest in Facebook’s Portal quite telling. If we think that a company product portfolio needs to stay within the bounds of the original job it was hired for, as I do, then technically Facebook Portal should appeal to Facebook customers. The sole job consumers hire Facebook for is to stay in touch with friends and family, and Portal seems like a product fit exactly for the core use and mission of Facebook. The recent reviews are not positive, mostly due to lack of trust in Facebook, and some early consumer feedback I’ve received is not positive either. Which begs the question if Facebook is misguided and will ultimately be unsuccessful in new efforts to expand the Facebook service into other categories. A conclusion that would be detrimental to Facebook stock as it would signal a growth challenge facing Facebook many bullish investors are not counting on.

Similarly, with VR and even AR to some degree, the idea of being with friends and family socially in virtual reality seems to be aligned with the core job Facebook is hired to do. While VR is early days, it is hard to be bullish on Facebook succeeding here.

Lastly, there is one other line of thinking I’ve had lately that I’d like to flesh out at some point. When I think about the value of ads on Facebook vs. Google, I have hunch consumers are more included to pay attention to an ad on Google than on Facebook due to the job each product was hired to do. I liken this to a receptiveness to ads based on each products job to be done. Google is hired to get information, therefore seeing an ad fits the context of the job Google is hired to do. Seeing an ad is not in line with the job a consumer hires Facebook to do, and therefore the attention to those ads is less than it is on Google.

Now, one can argue the more relevant fit for an ad in Facebook is seeing the brand and products friends and family like or recommend. This would make for a more aligned product fit for an advertisement in line with the core job of Facebook which is to keep friends and family connected. We know that recommendations from friends and family are one of the more powerful ways people discovered new products and services and given Facebook is a big direct to consumer advertising platform this seems like a relevant strategy.

For example, you have probably seen ads on Facebook for a new shoe company called Allbirds. On the Allbirds ads, I see on Facebook I also see some friends or family who has clicked the like button for Allbirds. That is all fine and good but what would be more relevant would be something like so and so recommends Allbirds.

Many of you may be familiar with net promoter score metrics and if Facebook or brands that advertise on Facebook could take advantage of brands that meet a certain net promoter score metric. This way the better brands, like Casper or Allbirds, have become, can become recommended products on the platform. Consumers who find these brands early, and have positive experiences generally like to tell others about the brand they discovered so they can be seen as tastemakers or trendsetters. Facebook and direct to consumer brand ads seem poised to take advantage of this and have better-performing ads on Facebook.

Facebook will hit wall after wall in their growth strategy if they don’t fix their user trust problem. While that certainly includes dealing with the abuse and toxic content, fake news, and advertiser exploitation, more refined and relevant friends and family influenced advertising strategy would go a long way in my opinion.

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Ben Bajarin

Ben Bajarin is a Principal Analyst and the head of primary research at Creative Strategies, Inc - An industry analysis, market intelligence and research firm located in Silicon Valley. His primary focus is consumer technology and market trend research and he is responsible for studying over 30 countries. Full Bio

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