Why Facebook's Open-Door Policy Is Good for Marketers

Looking to Create Utility for Users? Then Facebook Wants You

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NEW YORK (AdAge.com) -- The new face of Facebook is good news for advertisers -- especially those trying to make their marketing materials useful to social-network users by giving them ad-supported widgets or other branded apps.
Mark Zuckerberg
Mark Zuckerberg

This week, during a developer event in San Francisco, dubbed F8, Facebook CEO Mark Zuckerberg announced the site will open itself up to outside developers to create applications that can run on what he refers to as its "social grid." Essentially, Facebook will be happy to have users deploy any apps or widgets they like on their pages, giving advertisers who can persuade Facebook users to use their tools a way to get on the social network for free.

Divergent philosophies
The announcement marks the latest turn in the divergent philosophies of Facebook and its chief competitor, MySpace.

While MySpace, which boasted about four times as many unique visitors in April as Facebook, according to Nielsen/NetRatings, began as an open community, allowing cottage industries to crop up around the development of MySpace tools, it has lately implemented stricter guidelines as to what kinds of outside widgets and applications it will allow to be run within its community site, especially if they're ad supported. Essentially MySpace, which is not alone in this thinking, took the step partly to prevent advertisers slipping in the back door without paying. Facebook, on the other hand, began as a more closed system and has opened itself up to both users and developers of social applications and widgets.

And Greg Verdino, senior VP-director of emerging media at Digitas, believes that's a trend likely to benefit marketers. "As interrupting consumers ... with something that looks and feels like an ad becomes less effective, brands will needs to connect themselves to utilities," he said.

But getting consumers to distribute those utilities for you often means getting access to the popular social-networking sites. And in a more closed environment, an advertiser's options are either to work through the site to create the utility or risk alienation.

A great danger
Darin Brown, chief strategy officer at Razorfish, lauds the move by Facebook and said the openness of the internet is something other social networks will also have to wrestle with. But he warned that there's great danger in marketers getting it wrong. "If marketers think this is simply another broadcast platform in the sense that we're going to push a message at you, then they will fail," he said. "We believe we'll only be successful if we do something that provides value to consumer. It can't be a moving print ad."

Facebook is encouraging developers to build any type of application they want, including video and other media applications. It has promised not to favor or promote Facebook's own applications over those of an independent developer, even if the applications are competitive.

"Our users will decide which applications are the most useful for them," the company promised in a statement on its website.

Developers can monetize their applications through whatever means they wish, including e-commerce and advertising, although that advertising must live on what Facebook is calling a "canvas page" -- a kind of home page or profile page for the application -- rather than showing up in the application as it sits on a user's profile. However, a branded widget, such as Red Bull's Roshambull, a digital version of rock paper scissors, can appear prominently on a user's page.

Make application suitable to site
The important thing, said Bart Johnston, interactive director at Lincoln, Neb.-based Archrival, which designed the Red Bull application, is "to build an app that makes sense and takes advantage of a social network." Which Roshambull, he noted, aims to do: "If you're just sitting there by yourself, our application is no fun. It takes friends and that's what makes it work on Facebook."

So what's in it for Facebook and its own advertising sales goals? "Hopefully what that creates for marketers is if we can expand and have developers create great apps for our users, more users will join site and give advertisers more access to users in Facebook," said Mike Murphy, Facebook's VP-media sales.

But from a business model standpoint, Facebook must allow outside developers to make money off the applications because, Mr. Murphy said, "we want them to do cool stuff and they wouldn't be focused on developing applications for us if they couldn't make money."
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