The one thing you can do today to properly understand social media

If you want to understand how social media works, listen to the Facebook earnings calls. I tell people this.They don’t listen to me. 

That’s why I’m happy to tell you my little secret here, because you probably would rather pay two thousand dollars to go to a half day workshop and listen to people who aren’t Mark Zuckerberg and Sheryl Sandberg talk about social media. That’s up to you. 

Facebook has the family lunchbox users and Twitter wants them
And then Sheryl would have explained to you that social media is still a very small part of most brand’s marketing mix and that there is still a big job to do with marketers getting them to understand how to use and measure the ad products to demonstrate ROI. That would have explained to you the Twitter Australia/ Nielsen TV presentation last night and also the overly sorry apology from Twitter CEO Dick Costolo for not zapping enough trolls because they need to reposition Twitter as family friendly. The proactive communications machine roared into life well before the Twitter earnings results this morning which showed that, other than the Google deal, there wasn't much to say. 

Tony-hater of keyboard warriors, the Internet, coffee and the future of the free world
Apparently the Twitterati trolling politicians like former Prime Minister of Australia Tone Abetz for calling social media ‘electronic graffiti’ is not good content for top media buyer Woolworths selling 85 cent loaves of bread to working families so everyone needs to be a bit nicer so Twitter can attract newer, more gentle, kid’s lunchbox users and take some TV ad revenue. You would have heard Mark Zuckerberg explain very clearly to you that social media updates started as text and then went to photos- where Facebook got the big mainstream growth surge from- and that the next wave is mobile video. So if you want to make your posts to rank well on Facebook, perhaps you could post a video? Just a thought… 

If you are the one person that heeds my advice, then the Twitter earnings call this morning is a walk in the park to understand. You would have heard Sheryl talk about the growth of video on mobile and instantly understood why Twitter have incorporated video into their mobile app this week. 

You would have heard Mark talk about search and providing a search experience that ‘nobody else on the internet can provide’. By that he means Google. So then you would understand why Twitter has restarted their deal with Google to index data for search because everyone seems to go through the process of figuring out that a walled garden always seems like a good idea for ad revenue but it’s a big fail for content and discovery. 

Next gen products-mobile, visual, hyper social friend networks
You would have heard Sheryl talk about ‘next generation’ products like Facebook Messenger and WhatsApp and understand why Twitter launched group direct message functionality.You would have heard the Facebook CFO chappie Dave say (at great speed) that ad prices went up 300%, mainly due to growth in mobile video ads and because they can measure stuff better now. Um what? Yes the prices are going up. 

It’s brilliant, Facebook tells you everything. You have to be a bit more Turing code-breaker to pick the winners in the Google call because it’s basically everything they aren’t talking about that’s interesting. Analysts are spooned up some token numbers about ad network rates that don’t really mean much and then there’s a dismissive hand waggle to ‘emerging non-ad business’ and Google for Work’s plans to take over the world with their operating systems and work tools …look at the self-driving magic Noddy cars everyone!

Today, Facebook is setting the pace in social, definitely in a commercial sense and arguably in an innovation sense and they are worth listening to to give you clarity about the big chunky things that matter in the industry whether you personally like Facebook as a platform or not. 

But that’s up to you. 

Facebook is just getting started and marketers need to pay attention

I heard a TV journalist on the weekend casually start a question: ‘with social media sites like Facebook declining…” 

Now I’m not sure what measures she was using to get to that (if any) but nothing I’m seeing suggests that Facebook is in decline. From a business point of view, Facebook is looking very healthy. 

First Quarter 2014 Operational Highlights

  • Daily active users (DAUs) were 802 million on average for March 2014, an increase of 21% year-over-year.
  • Mobile DAUs were 609 million on average for March 2014, an increase of 43% year-over-year.
  • Monthly active users (MAUs) were 1.28 billion as of March 31, 2014, an increase of 15% year-over-year.
  • Mobile MAUs were 1.01 billion as of March 31, 2014, an increase of 34% year-over-year. 

First Quarter 2014 Financial Highlights

Revenue - Revenue for the first quarter of 2014 totaled $2.50 billion, an increase of 72%, compared with $1.46 billion in the first quarter of 2013. 

  • Revenue from advertising was $2.27 billion, an 82% increase from the same quarter last year.
  • Mobile advertising revenue represented approximately 59% of advertising revenue for the first quarter of 2014, up from approximately 30% of advertising revenue in the first quarter of 2013.
  • Payments and other fees revenue was $237 million for the first quarter of 2014.

Right so they have lots of people but are they making money off them? Well, yes they’re starting to. You just have to look at Mary Meeker’s State of the Internet analysis to see that. 

The figure that Mark Zuckerberg gets most excited about is the highly coveted 'daily visits' which sits around 60%. That’s really high and hasn’t seen the declines that even Facebook predicted once the platform reached a critical mass of users. By getting in to your phone and your daily habits, Facebook has a front-door to the social web that nobody else does. 

Recent acquisitions WhatsApp and Instagram are both in strong growth phases and are providing the younger audiences that Facebook desktop ran the risk of missing as pure mobile products develop. 

Installs of their own app give Facebook the most reach of any mobile product in the US.  Mobile app install ads have been a real winner for Facebook too with mobile app developers using Facebook as way to target and deliver their product in the Google Play or Apple App stores. 

So what’s this talk of declining?

Brands are getting less organic engagement on their brand pages. So you’ll see posts like this that make you think Facebook isn’t worth your brand’s effort. Quality content working together with paid ads is probably the direction you should be looking (for both Facebook and Google content). 

It’s the pay to play model that we’ve talked about before: if you want to target high quality audiences with your content, then you have to pay the same way that you pay for TV ads or billboard locations or the front page of the newspaper. 

Newsfeed ads have been very successful for the company and they are now moving away from those crappy little right hand side ads (which Zuckerberg describes as ‘legacy ads’) to a new design that look a lot more like a standard IAB ad unit, medium rectangle type thing. 

The new battleground is of course, mobile and Facebook is loving on its developers and trying to make things easier for them to develop for their platform by offering services like Parse that make the mobile development environment more simple and easier to monetise. App developers make money, consumers get better products and experiences and ultimately, Facebook makes money and continues to grow. That’s the plan and Austin Carr has written and superb article about it over here you must, must, must read -that’s three musts. 

The ad products are changing all the time and it’s really important that you dig a bit deeper and keep open minded about what you can achieve on different platforms. A campaign that didn’t work 12 months ago might work now. Instagram might be ripe for another look. You might need to take a look at this ‘over indexing of print’ figure and think ‘hmmm, maybe we are over indexed for print’.  

Because if the only  real reason is that 1. you have personal feelpinions and you just don't like Facebook 2. it's scary and you can't keep up and understand these new products, well then it's time to look at some quality data and learn for yourself and make some big girl decisions instead of agreeing with people on the television who might not know what they're talking about.