An interesting article over at the NY Times details the failure of Coca-Cola to follow through on its initial commitment as a Facebook partner in Beacon. Coke had been named as a “Landmark Partner” in Beacon along with Verizon and Blockbuster when Facebook announced Beacon November 6.
Notably Coca-Cola didn’t realize that Beacon wouldn’t be opt-in, and this was key in their withdrawal of support, and continued absence from the program:
“We have adopted a bit of a ‘wait and see’ as far as what we are going to do with Beacon because we are not sure how consumers are going to respond,” said Carol Kruse, Coke’s vice president of global interactive marketing, this morning..“I, like you, certainly understood that it would be opt-in. That’s what I heard before as well as what I heard on the 6th.”
As we know Facebook has now flipped on Beacon, switching to an opt-in model after widespread criticism from users and groups including Moveon.org. The evolving story though is how Facebook got to this point, particularly given key partners were led to believe that the program was opt-in, suggesting that someone, or something caused Facebook to switch to an opt-out model at the 11th hour.
See all
Post
I suspect someone ran the numbers of probable hits from opt in vs opt-out, but didn’t think through the downstream and upstream consequences in the remaing hour
.
It is not very promising to know that Facebook decided to change their Beacon policy to opt-in in light of attracting more partners. This move should have been done independent of what their partners said; simply because it was the right thing to do. Hopefully the users don’t find out the real reason for this change.
Opt-in ofcourse is less profitable for third parties, and companies wont want to be part of sumthing unpopular ofcourse
I could see the confusion. Facebook may have been like, “Yeah, it’s ‘opt-in’. People have to sign up for Facebook”…
Of course, it’s all good now, isn’t it?
@3, Mayank,
Opt-out is invasive and in long term it leads to attrition. Smart companies will realize that user loyalty is more important than beating few quarters. Coca Cola realized that people who did not expect ads in their feeds would develop negative connotation that could hurt the brand. It is just said that Facebook had to learn this from Coca cola, and not by listening to their users.
Or maybe good old Coke is jumping on the bash Facebook bandwagon?
One thing that is fascinating about the Blockbuster partnership is that you can’t buy ads for Netflix on Facebook. Yes, thats right, Facebook has blocked ads from Netfilx. What an awesome “open” platform…boooooo
well, i use adblock on firefox and it blocks all the ads anyway. i am glad facebook gave me the choice to opt out, though.
Coke is really something. When I lived in Morocco and visited the south desert area, there were coke signs everywhere. Coke is king there. Every home I dined in served coke. Everyone was always surprised when I would request water to drink.
Do a little 5-minute research on this, including just a quick glance at Techmeme, and you’ll see there’s much more to this story than the quick gloss over the topic and the naïve assumptions being made. Sounds like we’re giving Facebook the benefit of the doubt…where it may not be deserved.
@ Angela - your opt-out is meaningless….the stuff is sent anyway, we suspected it from the architecture and the CA guys proved this last night.
Here’s our post on the matter, links to a few others on the issue.
Caveat Emptor
Brandon (#9), thanks for the pointer. It is so easy to be blinded by Techcrunch’s obviously biased approach to covering Facebook stories. This post is clearly a minimalist approach to reporting on a much larger problem that Facebook is dealing with.
As other reputable journalists have put it, Mark’s ethics are at stake and solving the problem will require some serious PR work. Being called a lyer and a weasel is no fun, especially when there is convincing evidence that his actions match those characteristics. The question is will Mark have the courage to stand in front of us and tell us that he screwed up, or will he continue to carry his business card from his college days that reads “CEO, bitch”
Why didn’t they just start doing it without announcing it first?
LOLZ.
Facebook has a ton of money flowing through it right now. MySpace is too spastic to really provide any advertising ROAS. look at second life. same thing.
The money VCs or investors put into company does not provide meaningful metric for how well a company is or will be doing. We just saw a recent post on TC that disclosed how often VCs fail. I personally know of a startup that used to burn 40 mil every six months for over two years. I wish I could point you to their websites now but unfortunately it is not around anymore.
Money comes and goes, Good companies stay, bad ones vanish without a trace.
Facebook, presumably thought of to be even more trustworthy and trusted than MySpace, turns out, to be, not really.. when it comes to money.. market share.. competitions.. kinda a little disappointing..
In a sense, and in that sense, Google seemingly more honest, in that regard.
When are people going to realized that companies that got big like Facebook, Google, MySpace, don’t exist for altruistic reasons for the good of their users. These companies will only do things good for the users (usually spin in the form of public PR) if it is good for the companies bottomline. I can’t believe how naive people are going on bemoaning about facebook not doing the right things for their users.
I’m pissed at Facebook for deleting my account, w/no warning. And yeah, Beacon sucks, too!
My first impression was much like commenter #6 pointed out. But Coke is hugely concerned about their image, so I suspect that their due diligence probably included analyzing this. FaceBook on the other hand, would probably tend to be much less careful and have a tendency to take bigger risks. So my guess is FaceBook either 1) miscommunicated this because they are not nearly as organized as we think, 2) were intentionally very vague because they thought it would give them flexibility in making a final judgment, or 3) didn’t care about our privacy because they are more opportunistic than benevolent.
Duh… social networks should throw these brand thingies onto their users.. they got there users for other reasons.. Facebook could better try to get a partner to even sell internet calling.. I mean, not that that is a good example, but what I mean is that they should try to make money out of their core business as Zuckenberg himself describes it: facilitating communcation among people. Throwing brands and advertising at them does not do that.. giving them functionality, if sponsored even, might be a better path….
Excuse me, my first sentence shoiuld have been: social networks SHOULD NOT throw these brand ads at their users…
It is funny that a recent article here on TC tried to portray Facebook as a modern version of Apple, while brushing off myspace as more conservative Microsoft clone. Facebook will never be like Apple, simply because it lacks its customer loyalty, and does not care about its users.
Microsoft does little or no design and it products are famous for making people feel stupid. Their products do give people some value however and there are only a few other companies that can provide a full solution like Microsoft can. Most of the people who use their products are committed to using them by economic imperatives and the lack of alternatives. But few customers are loyal to Microsoft and this is why the minute a competitor opens up a shop next door, the users will leave.
On the other hand Apple is known for its remarkable devotion to design and attention to the details that borders on fanaticism. No other product or manufacturer inspires personal loyalty like Apple. It is not uncommon to see Apple customers wear T-shirts and sport Apple attitudes everywhere. The point being, Apple’s prowess is good, but not great. From a capability point of view, they are not much better than Microsoft in innovation. The point being is it would take Apple a lot longer to lose the market leadership than any other company that does not cater to its user base.
Facebook is following in the footsteps of Microsoft in their aggressive and risky approach to gaining the market. This will cost them in the long run and and they will definitely not be remembered as one of the cool companies.
(Some content borrowed from Alan Cooper’s, The Innmates…)
Mike Arrington’s silence on this subject is deafening and says it all given Techcrunch’s hand in over hyping Facebook. Arrington/TC were played like a chump by Google with their non-announcement around open social which TC bigged up and were played once again by Facebook with the Beacon announcement.
Stop trying to JUST announce everything first and instead start to add in some thoughtful analysis like Read Write Web. Think before you blog before you write!
So… my friends won’t be notified in their minifeeds everytime I crack open a beverage?
“Your fat bastard friend Chris Cardinal switched to Coke Zero. You should too, because you look a bit hefty in those latest photos, fat fuck. Loves and kisses, –Coke & Facebook Beacon”?
Well I guess this is it. I would like to thank the TechCrunch writers for delivering decent content covering a wide range of startups in the past years. Of course as many other readers I am disappointed in the recent degradation of the quality of TC content. The publicly open bias toward Facebook and other companies in the boy’s club like Ning etc is getting old.
The way I see it, Techcrunch in the past few months has become a billboard for anyone with some cash flow and its readers are treated as flock of idiots no different than those who could sit and watch a boring infomercial for hours at a time.
This is really ridiculous Techcrunch. Everyone should go read the blog out today by Computer Associates that speaks of how Facebook gets info about the user from 3rd party sites EVEN WHEN THEY ARE NOT LOGGED IN! If a site like Myspace had done this Techcrunch would be asking for blood but in this instance all we get is a a half-assed post. Pathetic.
I will too unsubscribe today… Watch Mark buy TechCrunch and turn it into his company daily blog. The content would then make perfect sense…. blah
Here is some more info. It will be released in the EU for 400 Euro.
Of course they switched to an opt-out model at the last minute.
If they hadn’t everyone would have STILL freaked out if they launched an opt-in model right off the bat.
So why do it?
By going opt-out they can now “retreat” to an opt-in model… if they went opt-in form the start they would have been FUBARed with nowhere to compromise on.
Moveon & co. think they’ve won. They’ve actually been played from the start.
We are way past “opt-in” vs. “opt-out” issue here. The question is who will ever trust Mark Zucker after having teared Coke’s tushy like a prison inmate from hell. While Mark is secretly laughing his ass off, I can still hear the squealing and screaming coming from the Coke’s PR camp.
Excerpt from Zuck’s Life:
Still walking in his trademark adidas slippers, Mark looks into the mirror and stops to think… “This was a good day” he sighs in relief.
I’m gonna have to talk to the coke people myself! Now that’s the Real Thing!
First, @22 Paul Smith:
I am in awe.
You read and comment on tech blogs.
Respect.
For everyone else who isn’t UK based. This is who Paul Smith is:
“Within 20 years of his introduction to fashion Paul Smith had established himself as the pre-eminent British designer.”
More here:
http://www.paulsmith.co.uk/company/
And from Wikipedia:
http://en.wikipedia.org/wiki/Paul_Smith_(fashion_designer)
@28 Ryan Coleman:
“Moveon & co. think they’ve won. They’ve actually been played from the start.”
I seriously doubt it.
This whole Beacon brouhaha is a big deal for Facebook because:
the fact that it took the CA Security Advisor Research Blog to make Facebook users aware that Beacon is collecting information on them *whenever* they browse the web, whether or not they are logged into Facebook … implies that some misinformation has been going on.
Read more on the topic on the CA Security Advisor Research Blog:
http://tinyurl.com/23urxn
Trust is everything on the social web.
#31, How would you know who Paul Smith is without having access to some sort of identification like email address at least or IP address? Speaking of invasion of privacy.. geez.
It’s a shame that Facebook is now rubbing its nose in its current Coke problem.
For most people in the world, FaceBook will be a term they will have to look up in an encyclopedia and then hold their laugh until their grand fathers come and tell them how many chicks they managed to score on it.
well that’s just shocking, how dare Coke, don’t they know who that kid Zuckerberg is?
Chirs,
He was the guy that you might have seen some 23 years ago on the miracle of life episode where the first anal birth was debuted.
“the fact that it took the CA Security Advisor Research Blog to make Facebook users aware that Beacon is collecting information on them *whenever* they browse the web, whether or not they are logged into Facebook … implies that some misinformation has been going on.”
Yeah, cause the whole freakin’ world reads the CA Security Advisor blog…
There’s no misinformation. Most people a) don’t care or b) have no f’n clue about what’s going on.
This is a classic play. Well over-reach your goal then retreat to what you really wanted.
You need to look up from your navel some time… hell, if you think the general facebook populous is following something as obscure as the CA blog - you’re pretty frickin’ naive.
Mtz (#25)
I’ve already noted the fact that Facebook is still gathering data in an earlier post…perhaps if you’d read them you’d know this
As for others: Facebook is the junior 1000 pound Gorilla to Google at the moment, it’s major news…we’ve always covered major news so I’m not sure what you’re problem is aside from the usual “we don’t want to hear about Facebook” stuff again. If they stop making news, we wont write about them, simple, however the reality is they continue to be a major source of news, not just on TC but all throughout the MSM as well. I didn’t make it this way, promise
To Ryan Coleman
I say you’re mistaken re the overplay and retreat. Or that MoveOn and the like have gotten taken. Coca Cola has now backed out of the program saying that they were told that it would be opt-in. News on the blogosphere can start at a key but relatively unknown blog like the CA one, but in an atmosphere like this, it can spread like wildfire.
Actually, the first post I read critical of Beacon was Charlene Li’s article:
http://blogs.forrester.com/cha.....unter.html
IMHO The problem is much more fundamental than what is obvious….It is about the transition of mindset from 1.0 to 2.0.
in 1.0 the owner created the content and hence had the right to decide what is good for the website. In 2.0 the users create the content and hence it is just natural to expect that the users will have a lot more say in what is good for the website.
However most of the website owners including the owners of facebook (and previously wordpress) tend to forget that fact while making a major decission.
jhinalala,
And in 3.0 O’Reilly realized he was getting carried away with the whole numbering of the web. His kids names however remain Tim 1.0, Tim 2.0 and Tim 3.0.
This is weird. I saw a short 5 minute presentation by a Facebook’r at the NY Tech Meetup last month and the impression I had was that it is opt-in right from the start. And with opt-in they didn’t refer to, “If you sign up with Facebook”.
But maybe I just don’t understand English so well.
Facebook’s reason for existence is to distribute information about your personal life to your friends. That’s what has made it popular to the tune of more than 40 million users and a lofty $15 billion valuation. People clearly want to share their information with their friends. Facebook Photos significantly reduces the friction in viewing photos; as a result it has quickly become the number one photo sharing site on the Web.
Beacon does exactly this. The biggest challenge in collecting information from users is finding the right level of friction. Too much friction and you have a product that people won’t use and no business. Too little friction and your product turns into a privacy nightmare. Beacon virtually eliminates the friction.
I did a detailed analysis of different approaches to collecting information:
http://redesign.wordpress.com/.....ok-beacon/
All good and fine. Here’s what I would really like to know: how is Beacon being accepted by the users? Ever since Beacon (and the corresponding brand pages) were launched, there’s precisely only one group of friends showing up with “xxx is a fan of yyy” or “xxx bought yyy here” - and that’s my friends who are senior Facebook employees. So adoption among my friends = 0. Although I like to believe that I’m at the center of the world, that’s admittedly a small and skewed sample, so anyone have a clue how this thing is actually being used?
folks,
You have to understand that the valuation of these companies is not justified by your Facebook profile. Nobody really cares what kind of music you listen to or how drunk you got last night.
It’s about eyeballs. And eyeballs have only two uses on the internet: porn, and advertising.
You don’t really believe that this is the end, do you? About 8 months from now, Facebook will launch a whole different way of tracking you. If that doesn’t fly … they’ll wait 8 months, then find a whole different way of tracking you. If that doesn’t fly … they’ll wait 8 months and try a whole different way of tracking you.
It doesn’t matter what you do. If you give Facebook information, they will sell it. It’s the business they are in.
There is a solution: Close your Facebook account. Nobody really cares anyway, and after all, it was just a fad. Seeing you drunk and showing your boobs probably isn’t going to look very good on your resume anyway.
Facebook is so 2006. They sold out. It’s now just a way for Coke and Verizon to get more info on you that they’ll just hand right over to the FBI or Chinese authorities anyway.
Dump it already.
Anyone else starting to notice facebook is the new geek scapegoat… microsoft isn’t looking so bad anymore!