Facebook’s “like” is a Failure (The Business Perspective)

The moment I heard about Facebook’s “like” feature, I shivered. The idea seemed brilliant to someone at Facebook, brilliant enough to push it through testing and into release (for a company like Facebook, that’s a pretty big deal). This new “like” concept was going to revolutionize Facebook usage on the Internet! It was going to show up everywhere! The Internet was going to become a big giant like-fest…

Folks at Facebook and Interweb “pundits” chimed in about how Facebook was doing this to help generate greater interest in brands. It was designed to lower the barrier to entry (so to speak) for a consumer to brands establishing themselves on Facebook. The idea was that it’s easier to “like” a brand than to be a “fan” of a brand. How cute, right?

Lowering the barrier to entry for a potential customer seems like a good idea, until you do the math. Let’s say my business is paying 40 cents per click on Facebook. If the barrier is at the “fan” level, I will presumably receive fewer clicks, but they will be from “fan” level (potential) customers. Fans are more valuable than likes (I’ll get to that in a second). If the barrier is at the “like” level, I will presumably receive more clicks than at the “fan” level, but they will be from “like” level (potential) customers. This means that I will be paying more money to Facebook for a less qualified potential customer.

BTW, the above is not conjecture. A lower qualified customer is not as valuable as a higher qualified customer. Now, let’s get into the difference between a “fan” and a “like”.

The problem with this is that businesses don’t want likes, we want fans. The Los Angeles Lakers (replace with any sports team) don’t sell season tickets every year because of their likes, it’s because of their FANS! Lakers merchandise does sell to likes, it sells to FANS!

But not every business is sports team… Of course not.

Now, let’s replace the Lakers with perhaps a watch company 🙂

People purchase watches that they like, right? I mean, you go to a store and see a nice watch and say, “I like that watch.” You don’t say, “I fan that watch.” So, obviously my theory is broken, right? Well, not really because you still haven’t purchased the watch. Liking something is window shopping. We all see a lot of stuff that we “like” in the windows but never buy. However, when we really find a watch that resonates with us, we become obsessed. We become a FAN! We figure out some way to convince our wife or girlfriend that we NEED that watch. Just like we need season tickets to the Lakers (good luck with the waiting list)!

Getting back to Facebook… They just devalued themselves. They are providing a less qualified potential customer and no business in their right mind will pay the same for a less qualified potential customer than what it was paying before for a presumably more qualified customer. That being said, time will tell whether the potentials are less qualified or not. My prediction is that the potentials will indeed be less qualified, and this will make Facebook less attractive to advertisers (like myself).

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