Sorry Twitter, Facebook Is The Data Gold Mine

I have been writing a lot about Twitter and Facebook lately. This is because I have started to see some trends in the way people are using the sites, and Facebook has been in the news lately. Sometimes, you write a post that makes a lot of sense, like my Twitter data mine post, and just a few short weeks later realize something better may be on the horizon.

This morning I read two blog posts that got me thinking. First, Chris Messina has a post about Facebook’s urls changing for its users. His post targets the vanity or named url, but he has a golden nugget buried deep in the post:

That everyone on Facebook has to use their real name (and Facebook will root out and disable accounts with pseudonyms), there’s a higher degree of accountability because legitimate users are forced to reveal who they are offline.

By forcing everyone on Facebook to be real people with their real name, they enforce civility in the conversations. You do not have to look far to find anonymous comments on blogs or forums where civility would be a nice upgrade from the outright hostility you sometimes see. Robert Scoble picks up on this thread as well when he predicts how we will use Facebook in a few years.

You pull out your iPhone or Palm Pre or Android or Blackberry or Windows Mobile doohickey and click open the Facebook application. Then you type “sushi near me.”

It answers back “within walking distance are two sushi restaurants that more than 20 of your friends have liked.”

So, I finally have reached the point of this post. I wrote last week that Facebook won the conversation battle because of the new redesign and the number of users they already have. For some reason I did not “put 2 and 2 together”. From the twitter data mine post a few weeks ago I said:

As you can see, there is money to be found in the data. The big question is whether Twitter can capitalize on this opportunity.

If you take this statement and change Twitter to Facebook, you will see what I mean. Facebook has almost 200 million users who comment using their own names, meaning actual people not some psuedonym. People tend to honestly comment when their real name is attached. Now that Facebook allows people to like and comment on other people’s status updates, the real analytics and data mining opportunity will be Facebook. So, when they finally get their status update search ready (and you can be sure that they will), we will see the amount of power that Facebook has. Facebook will be able to sell their data to companies wanting to understand market data. Facebook has the demographic and geographic data in place, and just needs to sell access to the data.

Monetization of Facebook may not be the “power of the network”, it will probably be marketing the data. Facebook is sitting on a gold mine of data that companies would pay a very high price for. Thankfully, if Scoble’s vision comes true, the users will benefit from it as well.

37 thoughts on “Sorry Twitter, Facebook Is The Data Gold Mine

  1. I’ll title this comment “Sorry Ari Facebook has lost the race for openness.”


    Post seems to have not enough research and citation behind it for such a declarative “Twitter has lost” statement. The number of user Facebook has no meaning except to the sales people in Facebook’s advertising department. Flashback to 1999 when AOL had more users than anyone else, but that sat on their laurels, failed to innovate, keep their data locked up.

    The race is has only just begun and Facebook is falling further behind every day it continues to keep its walled gardens of data locked up. Open will always defeat closed, every time, without exception. I guarantee it.

    I would point everyone to Matt Biddulph of Dopplr, who said that the true function of any social network is to make the invisible, visible for the users in the form a social object.

    Dopplr has well defined social objects ( flights and carbon units ) Twitter has text messages, Flickr has photos – what is Facebooks social object?


  2. @ronin691

    Facebook’s social object is people (identity). They are now trying to build on that, but it feels rushed (confusing terms of service gaffe and radical design overhaul in a short time for example).

    If they succeed in getting users accustomed and comfortable with a few privacy settings they could be on their way to the holy grail (SSON + address book + e-wallet services for the web).

    Just like open will defeat closed in many cases, it’s in the nature of the internet to prefer decentralized (standards+open) over centralized (proprietery+closed).

    In my opinion, if FB wants to stay relevant, they should play friendly with others and interop.


  3. As a professional I prefer to used LinkedIn as my social network of choice. Facebook is just too immature for my tastes and Twitter moves to fast with little or no real interaction.

    Excellent article btw.


  4. You’re completely right. Forcing users to fill out their real names is a data gold mine.

    However, I don’t agree with your statement that:

    “People tend to honestly comment when their real name is attached.”

    I think it’s the complete opposite and when our real names are attached we are more reserved and careful about what we say. A lot of the comments on facebook are very generic and safe with no real substance.

    When I comment on facebook I take a minute to make sure I want my comment attached to my name and there’s been plenty of times where I’ve gone back and deleted a comment that could be misinterpreted or harmful to my personal brand.

    I have a similar approach on twitter because I use my real name, but since the flow of communication moves along rapidly I’m more inclined to leave questionable comments on twitter than facebook. On twitter people say whatever comes to mind and stay in the moment. People have also been warned countless times about the dangers of exposing yourself too much on facebook and many of my friends have profiles that hide a lot of who they really are. Employers are still trying to catch up with twitter so we’re less careful there, though we shouldn’t be.

    There’s still a lot of value on facebook and real names keep the rift raft out but in my opinion anonymity encourages the most real conversations and is a huge reason the internet is such a powerful communication tool. We have the potential to market our ideal selves but we also have venues to vent and post our random ideas without fear of our personal brand being damaged.


  5. @ronin691

    If this was a year ago, I would totally agree with you. However, since that time, Facebook gave us an API for the status updates and recently allowed people to open up their updates to the public instead of just your network. They were falling behind before, but they are playing a good game of catch-up.


  6. Adam

    I was implying exactly what you are saying, but I obviously did no make it clear enough. By having your real name attached you will not throw some random hostile comment out, you will think about what you are doing first.


  7. Very well put. thought provoking.

    I see how Facebook wins if it continues to make progress as it has been.

    I look at it pretty simply. My folks/inlaws will never use Twitter, but they love Facebook becase it offers things like sharing photos/videos and the ability to keep in touch with people easily because ‘everyone’ is using it.


  8. trend watch : Sorry Twitter, Facebook Is The Data Gold Mine | Regular Geek…

    […]This is because I have started to see some trends in the way people are using the sites. Sometimes, you write a post that makes a lot of sense, like[…]…


  9. I had to work my way backwards from Scobles newest post, and then from Jessie’s, just to get back to yours! It was worth it! They both add to the thought provoking analysis you started here. Ever since I heard the term “Social Graph”, I knew there was value in the data, but you help clarify why it’s so valuable for Facebook. Honesty is one of the keys to the puzzle as you noted so well. Marketer’s want reliable data and you’re correct to assume they will pay dearly for it.


  10. Real names do help with developing a feeling of identity for the person on the other side & cause people to be more understanding, but it also suppresses some comments from more timid people. Basically, it takes the edge off the conversation, which can be good or bad. I’m glad we have both 🙂


  11. You’ve dug out one of the most powerful aspects of social networking: referral marketing.

    We are all happy to ask our friends or other known contacts for recommendations of restaurants, car insurance, printers or whatever. And chances are we’ll take a recommendation from a friend (or warning from a friend) more seriously than we’ll take a business spending millions to promote itself to us.

    Social networking makes the process of searching for friend recommendations a whole heap easier, but it also makes ASKING for friend recommendations easier.

    When I’ve got drawn into the threat Twitter presents to Google, I always point out that it’s not that you can search what people are saying, but that you can ask them outright there and then in a way that just isn’t possible with search engines. Why do all the work of trawling around for details of a gluten free pasta bar or telemarketing agency specialising in charities if you can just ask the question and people bring the answers to you?

    To your point, in such a scenario it is CONTEXT which is most important. I’ll only trust an answer over Google or yellow pages if it comes from someone in my network, where the connection as a friend is their accountability. Whether they are using their real name for all to see or an alias that I still understand is irrelevant; I’d still choose the word “king_of_eton” in my Twitter network over a real name whose opinions I cannot verify or trust.

    Ian Hendry
    CEO, WeCanDo.BIZ


  12. Facebook’s use of real names has little impact on the civility of the conversation. There are lots of nasty things said on Facebook by people using their real names.

    As for Twitter, having a handle doesn’t change what people say – they still have to build a reputation and be followed to have an impact. As that is all Twitter does, it’s far more successful at social search than Facebook will ever be. It’s not a battle of technology, it’s a battle of expectations. Facebook has data, but it also has a lot of crap you can’t duck – usually from people you know passing you drinks and adding you to silly apps. The sheer numbers give some people a lot of value, but Twitter and LinkedIn are much better for business right now.

    If there’s going to be a change, it will be because Facebook is used for business and not the personal stuff, and that is a very high hurdle to overcome.

    Again, the numbers allow different groups to use it as they may, but the vast majority on Facebook are there to play, and that dynamic is not easily reversed.


  13. @Jim Burbin

    I think that should be ‘having a handle doesn’t *necessarily* change what people say’ (example: me – i tend to be more timid) although that may vary depending on how closely (casual or business wise) the people involved know each other.
    The level of personal control you get on Facebook seems both an advantage and a problem with getting business further involved.


  14. Hey Rob – you are asking the wrong question! Who cares if Facebook can attract more advertising than Twitter? The real question is this .. Just how will the likes of Facebook and Twitter monetize their traffic to a point where their business is truly viable and sustainable? Until this becomes clear, social networking is destined to remain at the mercy of the herding nature of the masses and used only for self promotion and cheap and easy brand shouts.


  15. “By having your real name attached you will not throw some random hostile comment out, you will think about what you are doing first.”

    And in one fell swoop all the honesty that anonymous people on the Internet provide is gone. And that’s fine for people who are into that sort of thing. But I’d rather converse on the Internet with people who aren’t afraid to tell the truth. If I want safe, boring generic talk I’ll just go to the office.

    [Comment Edited By Moderator]


  16. […] Facebook is a marketing gold mine. They do not even have to charge for the data directly. They could charge for the ability to search extensively within anonymized data. They could charge for the amount of data returned from queries as well. The idea is that Facebook, and many of the existing social applications, are really just first generation applications. These will be the platforms that future applications may stand on. Twitter understands this and is trying to become the platform that people cannot live without. […]


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