so there are a bunch of horrified people reading my last post thinking: “what the hell drugs is he on?!”
the assumption for a very long time is that advertising was the way forward for web companies to make money. the assumption has been that we need to come up with some way to advertise in order to monetize web because people are not going to pay for web apps.
advertising to support web apps is an outdated and is a web 1.0 mindset.
that’s right little old me just made a very bold statement. here is why.
in what other scenario would you adopt a strategy in the marketplace where:
- everyone else was trying to do it that way and not having much success;
- every day, more people are in the same marketplace adopting the same strategy;
- your customers are sick of the whole model because they’re being pitched at all the time; and
- do everything in their power to circumvent your means of income?
you don’t have to be an mba to work out that’s madness.
i can only go back to marketing 101: “what is your point of difference?”
in the case of facebook, the point of difference is that people willingly submit identifying information. they willingly supply identity information. in return for that they can exchange photos and messages and add apps. that is one thing you can do with that capability, but why don’t facebook actually capitalise on their point of difference and harness that identity information.
throw that outdated mentality of “advertise! advertise! advertise!” out of the window.
before we get to the juicy bit…
security
facebook does not instill trust. not only is it not secure, it doesn’t feel secure.
think about this:
- do the spammy apps contribute in any kind of positive way to the environment?
- do the constant ads about sexy-single-women-who-want-you-now add anything positive to the environment?
- do either of them add negativity?
- how much revenue do they really generate?
now think about this:
- what if you totally trust the security of your account on facebook?
- what if you could setup security down to individual object, a photo, wall post or video?
- what if everything you uploaded was secure by default and you had to choose to share with specific groups or circles of friends?
- what if your account was securely encrypted and you could be sure that only the people whom who were supposed to see content saw the content?
it would instil trust wouldn’t it? if facebook stopped being so aggressive with things like beacon, it would also instil trust wouldn’t it?
okay, so i won’t get into the nitty gritty here, but let’s say facebook get their security where it was similar to that of an online bank, and make it really logical and simple for users to use and understand. what next?
monetisation
switch the spammy apps to commerce apps. turn facebook into not only a trusted online platform for commerce, but a trusted identity provider. instead of logging onto 30 different bank accounts, mail accounts, online stores, create one identity on facebook and have facebook verify the user’s identity.
something like open id but even more positive. the avenues to generate increase dramatically. sure, the photo sharing and messaging will still be there, people won’t pay for those services but what about:
- for an extra yearly fee, it becomes your single sign-on point, banking, email, everything;
- your employment information and education information can be authorised to credit providers so there is no additional paperwork, charged per transaction;
- you can sign contracts and execute agreements; or
- send secure messages to government departments or banks.
the possibilities are endless.
what’s more, the user gets all the free features and can pay for added value, the added value would actually be valuable to the user.
what’s more, they could charge a blend of:
- monthly fees;
- per transaction; or
- one off.
the trick would be to strike that balance. thoughts?
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