In a recent Hitwise Intelligence report it was determined that Facebook surpassed Google as the most visited site on the internet with 7.1% of web traffic vs. 7% for Google. To start, the logic of comparing total clicks could be fraught with errors but it is difficult to tell. Does the study just compare 'total clicks?' If so, I guess it makes sense that FB would have more clicks as people sit around and look at pictures of each other while Google is only utilized once to reach a new destination and then we might bookmark that destination and never search again (I admit, I'm a Google over-user). To use an analogy though, it is telling that one store in town is utilized more than all the stoplights combined! What does that tell you about society and where we are headed? We have more information available at our fingertips than we could possibly consume yet would rather scroll through Jennifer's 23rd birthday album.
Facebook has always been somewhat of an enigma to me anyways. I was reluctant to open an account but did so only after studying abroad a few years ago and thought it a prudent vehicle to stay in touch with others I met along the way. The logic is air tight but it has not happened as such. My account is basically sitting idle with a three year old picture of myself that I (very occasionally) sign into. I never thought others would be very interested in my current 'status' or random thoughts I felt like making available for mass consumption. If you're that interested in someone else, you should probably call them up and share some time together.
The awful part is marketers are now attempting to get in on the act. Although some have come to their senses, others think it's a powerful avenue that should be used to grow your business. I'm truly trying to keep an open mind but I just can't imagine having my consumption patterns altered by reading the latest Tweet about P&G products or the hottest new organic food. Any revealing stories for honest discourse would be welcome.
Even though I have always had a distaste for these productivity killers, there has been a shift recently from those around me. A colleague recently shut down his account because he realized it was a waste of time. Why now though? Is Jennifer no longer posting pictures? Don't you care that Jimmy is doing laundry because it's raining outside? Even a marketer friend of mine has reached the conclusion that 'social media' is an excuse to call a meeting but has little consequence to the bottom line. It's as if they do it for themselves more than other stakeholders. Now there's a way to grow a business.
Kevin Depew of Minyanville has been all over this topic for over a year. His latest update weaves together how social mood drives social action and ultimately the market. The topic might help us discern whether we are in a new bull market or only a counter trend rally in a bear market. If social mood is tightening with a larger focus on small groups and quality time, as observed, those feelings are more consistent with bear markets than bull markets.
The transition, though, will not happen smoothly. Remember, the debt markets were still interested in PIK toggle loans into the fall of 2007 when the writing was clearly on the wall that a debt crises was on the horizon. Similarly if you're in a herd headed towards a cliff, any chance to save yourself goes unnoticed until it's too late and in a free fall. If I were long social media, I would enjoy the bubble but set a quick trailing stop. Any attempt to value these businesses is blindsided by hopeful perspective reminiscent of the tech bubble.
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