Features

Facebook Strikes Back at Google with Billion$ at Stake

Written on
Feb 18, 2013 
Author
Peter Koeppel  |

Facebook and Google have been inching in on each other’s domain for years, aiming to become the primary method that consumers use to engage with each other – and with brands – online.

Google’s “Facebook killer” Google+ has been growing steadily since its launch in 2011, but is far from being the social media juggernaut that the company was banking on. Now, Facebook is striking back at Google’s core strength and attempting to socialize the search experience.

Facebook unveils new search tool. Facebook is adapting the common search engine model to the personal data the company has been gathering over the years – from music tastes to favorite local spots – and creating a hybrid search platform. In an announcement about the service in January, Facebook CEO Mark Zuckerberg introduced Graph Search – a new tool that will produce customized search results based on social connections.

With Graph Search, Facebook has reworked its existing data and spliced it into several different configurations so that people can find relevant results based on natural language search terms. For example, “photos of friends in NYC” will return their friends’ photos of that location. “Chinese restaurants in Boston” would deliver a list of restaurants that friends had liked.

Privacy, security and settings…oh my! Facebook was very clear that the new tool would not violate privacy and would only allow users to see information that is already available to them. Graph Search is being tested with select users, and when it is released to the general public all Facebook users will be reminded to check their privacy settings and make adjustments. The company stated that Graph Search would mine likes and connections (for example, returning results of friends of friends), but would not look through status updates to deliver results.

So, what does this all mean? Although the announcement didn’t discuss the future monetization for Graph Search, it’s certain to be part of their ongoing strategy. Search advertising could help Facebook make more money and expand the ad program currently used on its web based social network and social media app.

Billions of media buying opportunities – and advertising dollars – are at stake here. Google’s $40 billion in annual revenue mainly comes from its search engine advertising program. Ads are displayed alongside search engine results, and the search engine giant has indexed 30 trillion unique web pages.

If Facebook were to get just a fraction of that revenue, Graph Search would be considered a success – and it’s a strong likelihood that it will be. Google’s Search Plus Your World feature integrates Google+ results, but Facebook’s social data is far richer that Google’s. Not only does Facebook have more users, but the type and quality of information they are sharing on Facebook can make for a better social search experience.  In addition, Graph Search is backed up by Microsoft’s Bing search engine, which can deliver results if there is not relevant information in a person’s social network.

What’s next for search? Not only is Facebook poised to be a direct competitor to Google, but the company may also start to push out smaller, locally-focused search tools. In theory, Graph Search could provide detailed, social-focused information on local business, contacts and products. Local review site Yelp saw its shares drop more than 7% after Facebook’s announcement. Amazon’s product-based search feature and LinkedIn’s business connection search feature could also be threatened.

By leveraging social connections for information, Facebook is betting that its users – and advertisers – will get more out of the Graph Search experience than they will from standard search engines. With more specific search results, online media buyers will also have the opportunity to advertise at a much more targeted level than Facebook currently offers. Advertisers could use Facebook’s network as a one stop shop for search and social advertising.

However, the popularity of Graph Search still remains to be seen. They can build it – but will Facebook users come?





Peter Koeppel is Founder and President of Koeppel Direct, a leader in direct response television, online, print and radio media buying, marketing and campaign management. With a Wharton MBA and over 25 years of marketing and advertising experience, Peter has helped Fortune 500 companies; small businesses and entrepreneurs develop direct marketing campaigns to increase profits.

Peter started Koeppel Direct in 1995 and has built it into one of the leading direct response media-buying firms in the U.S. Follow me on Twitter.

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