Graphing Social Patterns: Day One
07.10.07Filed Under: Judge-O-Rama, Perspective, Tag Team, blippr
I’m only here through tomorrow morning at 6:00am, but I have to say that the first day of Dave McClure’s Graphing Social Patterns was a success.
In the first session of the Business and Marketing workshop, Lee Lorenzen of Altura Ventures and Rodney Rumford of FaceReviews were supposed to merely provide a Facebook 101 overview. However, given the knowledge level of the audience (though limited in some cases), they decided it would be better to discuss the economics and potential of the platform. This proved far more fruitful.
Lee began by providing his take on why Facebook has “staying power” compared to the other networks: “It’s built on trust.” Lorenzen also went on to state that, from a long-term perspective, he believes Facebook is going to be “as dominant as Windows” in terms of it being a platform. Some other highlights from his perspective included:
- The feature to organize your friends into different categories marks “the nail in the coffin of LinkedIn.” (Good thing Reid Hoffman hadn’t arrived at the conference yet.)
- Social networks are “like a country’s native language” in that, once they’re adopted, they’re there to stay. He believes that you will see few other social networks become dominant players after they have proliferated a particular community.
- In relation to his company’s valuations of various Facebook apps, he said that he believes developers “own an asset they’re undervaluing.” That asset, he believes, is the portion of user profile pages each application consumes.
- The best way to “jumpstart your app” is paying for an initial number of installs at a Cost Per Install (CPI) rate. Obviously he’s a little biased as his own adonomics offers this service, but for the most part, he’s right: the most successful apps must reach a critical mass before taking off and the fastest way to reach that mass is paying for the users. This point was recently proven further by Tim O’Reilly’s Facebook research.
Rodney Rumford took the stage next and provided his additional opinions on the platform. Highlights included:
- “Facebook is a WOM marketing machine with every friction point removed.”
- “If you want evangelists out there to spread the word and engage with your brand, there is no better place online than Facebook for this. We believe entire businesses will be built on Facebook.”
- When he joined Facebook, “Candidly, it wasn’t compelling to me because none of my friends were there.”
- From his perspective, it’s no wonder Top Friends became the number one app on Facebook. According to Rumford, Slide had a dedicated Customer Service person, treating Facebookers like customers, just like any business.
- In his tips to developers, he made the observation that “Users inherently trust anything that looks like Facebook.” So make it look that way.
After a brief lunch, Rogelio (Ro, for short) Choy of RockYou began with his take on the Facebook application craze. With his experience in the space and RockYou being one of the top two widget providers, his candor proved quite insightful. While some may view RockYou as one of the more spammy widget creators, there’s no denying RockYou’s phenomenal success. Based upon the success RockYou, Slide, and others like them, he posed a very good question during his time on stage:
Is it worth investing in your own destination, or only investing in the social web?
It’s a question we have been asking ourselves at Tag Team lately. While we firmly believe we’ve made the right decision in investing our time into the creation of our stand-alone apps Judge-O-Rama and blippr, we do foresee the opportunity to utilize Facebook not only as a marketing and complementary channel for our current sites, but as a breeding ground for new ideas. Imagine the possibilities if all companies were going about testing the viability of their ideas across a userbase the size of Facebook’s, minus the costs commonly associated with such development. Companies would have the opportunity to see exactly how people use their service and gather feedback from customers before ever developing something that, in the end, might not work out (or could at least use some tweaking to work better). That’s exactly what Facebook affords the development and business community and I can tell you assuredly that Tag Team looks forward to using it in this effort.
One last interesting note I want to point out about Ro’s message. Without any prompting, he brought up the recent blog bashing RockYou’s CEO, Lance Tokuda received as a result of his comment to the New York Times: ”If you told me you were going to write me a check for $10 million, I’d say, ‘Forget it.’” I agreed with Ro’s perspective on this matter. All the bashing came from bloggers because, as Terrence Russell of Epicenter put it, “Facebook has recently added rich media capabilities to its own Wall, and despite Super Wall’s 10 million user adds, the app has ultimately put itself in the path of the site’s natural progression… his high valuation will be on shaky ground if Facebook continues to expand its features.” This would be absolutely true if Facebook were the only player. But as Ro so insightfully and even casually pointed out, RockYou isn’t just betting on Facebook. They’re betting on networks like MySpace, Bebo, Hi5, and a long list of other sites to follow Facebook’s lead in opening up their platforms. From my perspective, that’s not just a good bet, that’s a sure bet. So while 10 million users may be one thing, what type of valuation could RockYou get for that single application if their SuperWall audience doubled, tripled, even quadrupled?
It’ll be interesting to see how everything plays out on the app market, but one thing is certain: you can stay tuned for some entertaining and useful apps coming from us very soon.
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