RSR Research: Facebook Open Graph and Graphite

Discussion
May 01, 2012

Through a special arrangement, presented here for discussion is a summary of an article from Retail Paradox, Retail Systems Research’s weekly analysis on emerging issues facing retailers.

There’s one area where Facebook has been less than a roaring success — in helping retailers actually sell stuff. The "like" button just didn’t do the job and companies like J.C. Penney and Amazon started and then stopped selling on the network. According to e-marketing firm 8thBridge, 57 percent of users "liking" a product already own it.

Facebook’s answer? Open Graph.

Open Graph allows users to do something more than just "like" something. Users can "want," "wear," "own," and even "need" something they see on Facebook. And 8thBridge thinks it’s got just the tool to mine and extend Open Graph to drive real revenue within Facebook’s boundaries, while still emphasizing the retailer’s brand, not just Facebook’s. It’s new product Graphite officially launched on April 25, already with a stable of pre-launch customers.

[Image: 8thBridge Graphite Launch]

The Graphite concept goes like this:

  • The Open Graph buttons aren’t just Facebook blue. They can becustomized to match the look and feel of the brand being liked, wanted or owned.
  • Bridal registries? Who needs them when a Facebook user can identify everything he or she wants for a gift?
  • Pinterest? I’ve been a bit lukewarm to this already, but in fact, Open Graph and Graphite extend Facebook into a better picture of the person, not just of their "stuff". When you couple Open Graph with the Timeline, a picture of a person emerges across time. Their changing tastes, their seemingly chaotic paths to purchase spelled out in detail, the incomprehensible becomes manageable. Big data tamed.
  • One-to-one marketing? Graph’s API can drive an email trigger for a great price on an item a Facebook user has said she "wants."

Similarly — much like Amazon’s been doing for years — the enhanced Graph
API will allow the retailer to create interesting cross-sell recommendations or other "things you might like" based on the data gathered.

All this can be accomplished by marketing, with minimal interaction with IT. Why am I cringing? Because you know that won’t last forever, and IT will have one more thing to play catch-up with. Still, I am obligated to tell you this. Minimal IT intervention. Period.

We think Graphite and Open Graph are definitely worthy of a look. After all, can any of us afford to ignore a crowd of 901 million Facebook subscribers?

I’m still not sure I understand why Instagram was worth a billion dollars. I don’t pretend to understand what its recent purchase of AOL’s patents will amount to. But I can understand the concept of "want," "wear," and "own." I’m intrigued.

Discussion Questions: Will Open Graph incent customers to actually buy on Facebook? What do you think of an app tool such as Graphite as an e-commerce link for retailers?

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12 Comments on "RSR Research: Facebook Open Graph and Graphite"

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Adrian Weidmann
BrainTrust

There are three extremely compelling points made by Paula that simply cannot be ignored.
1. 900 million subscribers
2. An easy method to tame a large amount of data
3. Minimal IT intervention

Just those three points combined with a vehicle to let shoppers tell the world the items they “want” and you have an extremely attractive value proposition. I too am intrigued.

Ken Lonyai
BrainTrust

What seemed intuitive to so many — that a “like” would handily turn into a purchase, has reportedly materialized for very few. The big problem with that logic is laziness. So many have taken the easy way out with a free presence on Facebook, expecting that Zuckerberg and crew had done all the work to deliver waiting customers to them. It’s not that simple on the open web and as many have seen (including big brands with proven marketing departments) it’s not that simple on FB.

Open graph clearly provides a lot of useful data that in many ways is more directly insightful to marketers than culled data run through algorithms to develop buyer personas, as is done on large web sites. I’m certain it has weaknesses and the potential to misconstrue information as well. Still, using Open Graph as described herein is a better approach to FB marketing than the common, slapping out FB pages and smearing likes across the web.

Having not seen Graphite, it’s not fair to comment on it.

Frank Riso
BrainTrust

I may be too old school in my thinking, but I believe a retailer needs to walk before they can run on facebook or for social media in general. A retailer can learn a lot about their store from facebook. What consumers like about the store, the staff, and the total shopping experience are basic likes and dislikes that more consumers would comment on facebook. It takes a dedicated team to keep a retailer aware of what is going on about them on facebook.

Merchandising in any form on facebook would come later in the life cycle of retail social media and primarily in the fashion store segments and maybe consumer electronics. Getting this next generation of facebook friends to respond to any form of merchandising feedback may take more work the just the want, wear, and own concepts. It may take a bit of “Gamification” too.

Ian Percy
BrainTrust

I was sitting here thinking — “Know what I need? Another social media outlet!” And then this news about Open Graph appears! Isn’t the synchronisity universe wonderful?

Social Media is driving social media and I’m at the point where I’d be happy if it all went away and we got back to actual relationships. Lots of drama and mass hysteria but not much in terms of meaningful results. It’s become one huge flea-market of self-promotion.

For example, AdAge reports that, while there’s never been much evidence of online display adds working, “they matter less than we thought.” A study from Pretarget and ComScore, who analyzed over 260 million ad impressions, revealed that even when a user clicks on an ad, the correlation between that click and a conversion is virtually nonexistent. So what will retailers get with the Open Graphs of the world? Lots of show, no dough.

Can retailers afford to ignore 901 million Facebook users? Why not? They’re ignoring you.

David Dorf
BrainTrust

We’ve already seen that duplicating your e-commerce site within Facebook is the wrong move. To take advantage of Facebook, you need to think in social terms and leverage the available interaction tools. People want to express themselves, and the customizable “like” buttons will certainly help, both on Facebook and on your e-commerce site. This refinement of Open Graph is long overdue, and 8thBridge has done a good job of making it accessible to retailers.

Fabien Tiburce
Guest
Fabien Tiburce
5 years 5 months ago

So much is wrong with Facebook trying to sell stuff.

1. Facebook is backed by a relationship graph, not an interest graph. My friends generally have different interests than me. While they are still friends, I am more likely to follow the recommendations of a “expert” when actually buying something (for example a blogger).

2. Trying to sell stuff on a social network, is a bit like trying to pick up at a wedding. It’s out of place. People don’t go to Facebook with the intention of buying and attempting to sell them anything can backfire.

3. Renaming buttons is not going to change the fact that Facebook is a social network not the internet itself (in spite of what FB is trying to do).

Bottom line, I think FB is a wonderful social network but a lousy place for merchants, brand awareness notwithstanding (i.e. advertise on Facebook but don’t expect measurable ROI or sales).

Cathy Hotka
BrainTrust

This is a perfect opportunity for companies to harness the opinions of twenty-somethings who are setting up households and establishing brand loyalty. My daughter, a recent college graduate, would probably love to use Open Graph. Me? Not so much.

Jason Goldberg
BrainTrust
Facebook has a long way to go to make the Open Graph useful. 900 million people use Facebook because it fills a need (helping us to connect and stay connected). But many of Facebook’s supplementary experiences are murky at best. What does an average user expect to happen when they “Like” something? Ask a pool of Facebook users and you’ll get wildly different answers. Now replace “Like” with an unstructured “verb” and it will be even less clear what users should expect to happen when they “verb” a brand. This murkiness of customer experience is exactly why Instagram can be so popular when Facebook already has native photo sharing. The native sharing in Facebook is convoluted and users crave simplicity and predictability. When I share a photo with Instagram, I know what will happen, but when I upload a photo to Facebook, I’m not so sure who gets to see it. It’s the same reason Pinterest can exist in a Facebook world. Adding more “verbs” to e-commerce sites that are somehow linked to Facebook, doesn’t feel like it solves a problem that shoppers realize they have. And for retailers, do we really need to give more of our customers’ data… Read more »
Lee Kent
BrainTrust

First off, this is not about Facebook selling stuff. This is about using APIs (long overdue in the retail industry) to target market to folks based on what they really want and need. This is a great tool and i am looking forward to seeing more tools like this in the app world!

Ralph Jacobson
BrainTrust

All of these marketing techniques need to settle in before a perspective can be reached. This is an exciting time for retailers and manufacturers alike. We will look back at these years and think we were all so confused. I think the dust will settle on a vital few apps that the vast majority of shoppers use. Facebook, for now, is the mammoth with its subscriber base, however, we have all seen how fast an internet giant can morph and/or disappear.

I think the tools are trying too hard. I believe the shopper/consumer wants an even simpler interface. Again, there are almost a billion subscribers of Facebook, however, until the majority actually utilizes some of its features to drive business transactions, we will have to wait and see what “sticks” as companies experiment.

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
5 years 5 months ago

It occurs to me that Open Graph and Graphite are just new ways to game the Facebook system. How do you verify with any sense of confidence the truth of your company’s comment trends on Facebook? Perhaps it would benefit your competitor more to eschew the cost and organization of a Facebook presence of their own and, instead, spend the money to create a department whose task was to place negative and misleading comments on your Facebook?

Mike Osorio
Guest
Mike Osorio
5 years 5 months ago

Interesting that many comments here are made without checking out Graphite in detail. This 11 minute video interview helps explain it simply and quickly.

The product looks to be quite compelling, but leveraging off the only real way that social marketing leads to selling: via individuals, not by brands. By using our natural tendency to share with our friends, Graphite, on top of the Open Graph platform, enables us to sell for the brands by making it easy to share and recommend via FB.

Like anything, this will have it’s flaws, but it is a great effort and will likely lead to a level of success and perhaps more importantly, the developers who will build upon it.

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