Google, Facebook to Lock Horns on Branding, Behavioral Targeting

By Clint Boulton  |  Posted 2009-06-24

Google, Facebook to Lock Horns on Branding, Behavioral Targeting


Analysis: For those who can't get enough of the competition between Google and Facebook over traffic and advertising dollars, a June 22 Wired article by Fred Vogelstein characterized the Google-Facebook battle as a kind of Muhammad Ali vs. Joe Frazier for the Internet age.

Still, "Great Wall of Facebook: The Social Network's Plan to Dominate the Internet - and Keep Google Out," has industry analysts talking. Vogelstein chronicles the Web services providers jousts, from the time Facebook spurned Google's offer to strike a deal to the present, where both companies struggle to tackle Twitter and the challenge of real-time search.

Despite its unquestionable success in converting search ads to ad dollars, Google in the piece comes across as an Internet has-been, while Facebook is the communications platform of the future, never mind that it hasn't earned even a fair percentage of what Google has garnered in the online ad world.

Facebook reportedly reaped $280 million in sales in 2008, compared with Google's roughly $16 billion for the year. Facebook has 200 million users, some of whom spend 20 minutes per day on the network. This social garden is largely walled off from Google and other search engines as a competitive advantage; Facebook can't promise personalized connections and tailor unique services with Google crawling its network.

Sterling Market Intelligence analyst Greg Sterling told eWEEK that while Facebook has been pushing out more of its pages to be publicly crawled (note the recent vanity URL effort) to get traffic, "you don't search Google to find what people on Facebook said."  

While Google has conquered paid search ads, Facebook is improving its search functionality so that users can look at their friends' feeds. The company also launched Connect to let users access friends' data on Facebook partner sites and rolled out an API to let programmers pull Facebook News Feed information to other sites, such as Twitter.  

Google, Facebook Race Toward Behavioral Ads


The logic, of course, is that if users keep posting content and links within Facebook, they might not have to look to Google to find what they need. The Altimeter Group's Charlene Li told eWEEK:

What Facebook is doing is surfacing a lot more of that human expertise. You can go out and actually tap peoples' expertise, their experiences and their past transactions. I can go and see who has bought, amongst my friends, the Palm Pre, and poll them and ask them what they think. That allows me to customize and really get the things I need done much more efficiently because it's more attuned to my needs. 

But how does Facebook make money from this glut of personal information? The popular consensus is that behaviorally targeted advertising is the key and Google, Microsoft and Yahoo are all hungry to claim a slice of this pie Facebook is trying to bake. Google started along this path in March.

Such ads would target customers based on the information in their user profiles, but users have thus far been loath to agree to what they view as an intrusion on their personal lives. Users want to be chatty Kathys with their friends, share applications and connect in other ways, but it has yet to be proven whether they want ads tailored to them based on their Web services use. Exhibit A: The difficulties of Facebook's Beacon targeted ad campaign.

Li said she entrusts Google and Facebook with her personal data and wagers that others out there will, too. The key is pushing the right buttons to get people to grant access to their data. Web promotions may be the key, said Li, noting that "people will give away their privacy for free shipping."

Even so, Gartner's Andrew Frank told eWEEK that Facebook still has a fundamental problem exploiting its data for high precision behavioral advertising while maintaining the loyalty of its user base.   

Cracking the behavioral targeting nut is key for attracting brand advertisers, identified as the prize for which these rivals are competing. For example, Frank said BT has shown value in targeting "in market" consumers who are in the consideration process for a purchase with what brand advertisers would call "direct response ads," or those ads that lead directly to a sale.

Twitter in the Mix

"Brand advertisers tend to focus more on the use of high-impact formats like video and sound to engage consumers on an emotional level, while precision targeting takes a back seat," Frank said. "Neither Google nor Facebook seems to have a very good answer for that."

And if these vendors did manage to find a good answer, would that answer work in such a way as to appease the Federal Trade Commission, which is watching the evolution of online advertising with a concerned eye? Politicians on Capitol Hill are pushing legislation to regulate the online ad market with a special attention on the data Web services providers use to target customers.

"A lot of people are not taking that whole FTC angle seriously, and they should because I think something is going to happen," Sterling added.

Complicating the latest online ad land-grab is Twitter, the popular microblogging service that has come to encompass the practice of real-time Internet communications. Users post 140 character or less messages to a network of users, telling them what they're doing at a particular moment in time. Twitter has more than 17 million users and its growth shows no sign of slowing.

Twitters' founders have confounded analyst and blogger corps by refusing to commit to any business model. Facebook and Google both failed to buy the company. Is Twitter the missing link to socially targeted advertising?

Search expert John Battelle believes Twitter's real-time search scares Google, while Sterling notes that "it's an open question whether Twitter will evolve into some search substitute in some limited number of cases."

Sterling allows that while the word-of-mouth factor on Facebook and Twitter are highly relevant and people value the trusted sources of information they enable, sometimes it's hard to beat good old-fashioned Google, which by the way, also offers collaboration apps and other Web services.

"I've been talking with a friend about planning a vacation and the Internet offers all of these resources, but it's a maddening and exhausting process checking all of these deals and sites," Sterling said.

"The introduction of additional complexity to the system is not what end users want. You could argue the success of Google is built on its speed and simplicity. It delivers pretty good results consistently. The idea of adding layers of complexity to that proposition is undesirable to the mainstream."  

Rocket Fuel