Canada’s privacy commissioner has scolded Facebook in the past and forced them to make changes but Facebook is like the cat who came back. They keep making changes to their privacy because they want to monetize their site. I don’t have a problem with that, but it needs to be in a way that protects the contributions of Facebook users.

I think the best approach is to lock down your privacy as much as Facebook allows, going to “friends only.” I also have a policy of not adding people whom I have not met or are not identifiable. I have added a couple who do violate this policy, but I felt comfortable adding them because of connections to other people I know, so there’s no problem there.

There are some “friends” that I have not added that aren’t actually people but maybe something like Lucy the elephant. These profiles are more appropriate as fan pages and I have not added them. How do I know who is behind the profile or who has access to it? Deny. As a fan page I’d consider “liking” them.

It would also be wise to limit potentially embarrassing or damaging information on your profile. I hear stories about potential employers finding these types of things on Facebook profiles and I always wonder why these people have open profiles in the first place.

I don’t have embarrassing information in my profile, but it doesn’t matter. No potential employer is going to see my profile unless they’re already a friend, in which case they already know me well enough to know my talents and flaws (hoping the talents outweigh the flaws!).

Facebook advantages

Facebook is one of the primary ways I keep in touch with friends and family. I would be very reluctant to eliminate it from my life. That’s not to say it won’t happen if Facebook continues to abuse its position with the site’s users.

While I don’t talk to everyone all the time (who has the time for that), I do try to go through everyone’s profile on a regular basis just to see what everyone is up to. Status updates, in my view, are the seeds of conversation.

My advice to Facebook is to respect user privacy and find a way to make money that doesn’t involve selling out its users. You as a Facebook user create a lot of value in your activities.

Facebook knows that data miners love things like Facebook so they can learn new ways of selling you things. Consider yourself “ore” in Facebook’s eyes. Facebook has a huge deposit of 400 million or more users and that’s a lot of value.

All Mark Zuckerberg has to do is find a way to mine the ore without destroying the deposit. So far he hasn’t done such a great job, which is why government regulators have to step in and slap his wrists. Facebook is his to destroy. I hope he makes better decisions in the future.

The other post ended up being more like a manifesto than a blog post, so I’ll save that for another time. I just wanted to show my support for the Iranian people. They deserve free and fair elections, something they didn’t get this time.

The Iranian theocracy should see the writing on the wall. Their days are numbered. The protesters might not succeed this time, but demographics are working in their favour. They can see the freedoms and openness in other societies around the world. They want it. They deserve it.

WARNING – THE VIDEO IS VERY GRAPHIC.

After the death of Neda Soltani, a beautiful young Iranian woman captured so vividly on video, you’d think the Iranian government would realize they’re losing the PR battle around the world (and more importantly, at home), and it’s only going to get tougher. Unfortunately these types of corrupt dictatorships tend to hang on to the bitter end. Let’s hope it’s a very bitter one for them.

One of the more interesting aspects of all of this is how social media like Twitter, Facebook and YouTube are being used to get video, audio, pictures and text out of Iran to let the world know what is happening. Despite the worst efforts of the Iranian government to stop the information flow by arresting and ejecting foreign media, the information is still flowing out. The government there hasn’t been able to stop the information flow, and let’s hope they don’t.

I am sure it’s been difficult for world leaders to talk publicly about this issue, but they need to condemn the actions of the Iranian government and take actions to support that condemnation. I understand they want to work with the Iranian government but how can you work with a corrupt, violent government like this?

The Iranian protesters are sacrificing a lot to change their society and I support them. The question I have is: would you be willing to do the same to support democracy in your country?

Facebook is making money. Whether they’re in a profit position yet, I don’t know, but they are running ads. I’m sure there aren’t many people out there who would begrudge Twitter and Facebook from actually making money off social media.

Okay, there are a few old-timers who think that everything on the Internet should be free and no businesses should be allowed on. Since universities and the military were the first on the ‘net, they can stay. *Yawn* When will these old-timers go away?

So, what’s the best model to make money? Facebook is making money from ads. That’s a start. Too bad they allow so many garbage ads on there. Now I routinely ignore them. Not sure, but I may start seeing erectile-dysfunction cure ads on there soon. (I’ll ignore those too. I’m a long way from needing those!)

Facebook has polluted its well by allowing junk ads. With pretty good demographic and psychographic targeting available with Facebook, you’d think advertisers would avail themselves of those tools and actually attempt to match up their ads with those most likely to act on their offers. I’m not sure who’s interested in six-eyed babies, or determining if they’re smarter than Barack Obama, but…

And if Stephen Harper really did have an $11,998 cheque waiting for me, I might just click on that ad.

I talk to people regularly about the garbage ads I see on Facebook. It’s sad that they’ve almost ruined a golden goose.

Good online ad model: magazines

I’ve said this many times before, but people don’t always ignore ads. You just need to give them the right ones. Do you have a hobby? Do you purchase a magazine related to that hobby? Let’s say you’re into four wheel drive trucks. You are quite likely to read the ads in a magazine related to it because magazines that are tightly focused on a certain hobby usually have ads directly related to that hobby.

The benefit? Readers typically look at the ads because they are directly related to them and their interest. The ads have information they may find useful. There are products the reader is very likely interested in purchasing. I get a few magazines and I do read the ads because they provide me with some useful and interesting info. I have bought products based on ads I’ve seen in those magazines.

The key here is focusing on the audience. Give them ads that are related to their interests. Facebook gives users plenty of opportunity to define themselves and their interests. There’s no excuse for Facebook not to serve up useful ads. Facebook allows advertsiers to focus their ads with a limited amount of demographic data. It’s not perfect, but there really is no excuse for advertisers not to try. Perhaps Facebook can have ad reps assist advertisers and also reject ads that are spammy, sleazy or deceptive.

It’s really a simple concept, so why do so many websites just not get it? I guess they’re desperate to have any kind of revenue at all, so they’ll run complete crap and call it advertising. It really is an insult to your user.

If you’re actually trying to make money online and do it via advertising, you’d better provide some value to the user. Facebook seems to have missed the point on this, although the ad quality had been improving slightly, lately. I hope that trend continues.

How much are you willing to pay? Are you willing to pay at all?

I woke up this morning to a story on CBC about the possibility of paying for Twitter. The comment was they have a long way to go to compete with Facebook’s 200 million users (I guess Twitter has 32 million).

I have heard this before, mostly from people who are likely users of one or none of the aforementioned services, that there is competition. Anyone who is familiar with both services understands that they are quite different. It’s not really about competition.

Though that is the case, Facebook has definitely tried to work in some of Twitter’s look, and with many complaints along the way. In the hopes of keeping users from falling off? Why?

Facebook’s purpose is quite different and many people have already integrated Facebook and Twitter, at least in terms of updating their status in Twitter and pushing it to Facebook. Maybe Facebook should make it so you can update your status there and push it to Twitter? Makes sense and Twitter makes it easy to happen.

Facebook is mostly about connecting with family and friends and rounding out your profile. I’m curious about the figures, but I’m sure there are many people in Facebook who don’t even update their status.

For me, it’s not an either/or proposition. I use both Twitter and Facebook and will continue using both.

Twitter: not making money in social media yet…

Twitter has already started some minor advertising on its website and I think they’re even selling t-shirts now. It’s just not enough to pay the bills I guess, so they’re thinking of charging users.

This is a path fraught with danger, and I hope Twitter tweads cawefully (sorry, had to do it) in this area.

Twitter doesn’t have a huge user base and I don’t think the community has grown to a critical mass that it can afford to alienate a large chunk of users. So what are some money making options?

1. Charge a flat/monthly fee
2. Advertising
3. Freemium model

Twitter: charge a flat/monthly fee

I think a flat or monthly fee would be the worst option, no matter what the cost was. Twitter really relies on new users growing the community. Many new users have no idea what it is all about and a lot don’t come back. Those users are not likely to sign up in the first place if they have to pay to play. The existing users may stay, depending on how much the fee is.

The story I heard this morning mentioned possibly charging businesses for an account. What about employees who occasionally Tweet about their employer? Or the guy who runs his own business, but Tweets under his own name? How do you police that? It sounds like a recipe for disaster.

Twitter: make money on advertising?

So far it doesn’t seem to have gone so well. I’m not sure how they could work ads in without being too obtrusive. It also upsets a lot of people and they’ll likely be ignored, like most Facebook ads are. You can make money doing online advertising, but you need to do some serious thinking to do it well. Would it work well with Twitter anyway? I tend to doubt it.

Twitter: freemium model

In my opinion, this is the best option. There are many examples of companies already doing this, like Flickr. You give basic users simple, useful functionality. They test out the waters and decide if they’d like to upgrade to the premium service.

Flickr is a great example. You can upload photos at the basic level, but are limited in how many you can upload and your storage. With a pro Flickr account, you get unlimited storage and uploads per day. The kicker? It’s only $25! As soon as I saw that, I almost instantly signed up. At $25 per year, why wouldn’t I sign up for a Flickr Pro account?

Twitter could do the same. Money making strategies aren’t exclusive, so maybe premium users could avoid seeing ads. Perhaps they could use a standalone client that Twitter is hopefully developing. Maybe they could get 200 character Tweets.

Twitter freemium pricing

The trick is finding the pricing sweet spot. I have given this some thought in recent months and I like the $25 annual fee level. I think with many users, even up to $50 would be okay.

Don’t be greedy though Twitter. If you indeed have 32 million users, if even just 10 per cent signed up to a $25 freemium Twitter account, that would be $80 million per year. I am willing to bet there are 3.2 million people willing to shell out a measly $25 a year to get a Twitter freemium account. That’s about the price of a case of beer, and it’s good for the whole year.  A case of beer doesn’t last me a year or give me as much as Twitter does.

I would like to see Twitter stick around. I find it useful and I like the friends I’ve made there. I’m hoping Twitter makes the right decisions and really thinks it through when they’re deciding how to make money online. The wrong decision may just send people looking for their competition.

Tomorrow’s article: Advertising isn’t so bad if you do it well, Facebook isn’t

Comments:

1. Greg Balanko-Dickson Says: November 12th, 2008 at 6:07 pm You definitely can make money online, I have built my business almost exclusively since 1998 using my blog and online networking to meet people and develop relationships.My experience in operating and selling my businesses over the years is it is a marathon, not a sprint. With the major recent economic hiccups we need to do more and use longer time lines than before.Relevancy is the foundation of any successful business. Understanding customer needs is what allows us to create relevant content.
2. Alain Saffel Says: November 21st, 2008 at 12:24 pm It’s good to hear that there are people out there who are making money online successfully.It’s definitely possible. I think people just need to watch out for the get rich quick schemes. Too many people have the ‘quick score’ mentality and aren’t in for the long haul like you’re saying.
3. Alain Saffel Says: November 25th, 2008 at 8:56 am Be careful about posts that talk about making money online. The spammers will sniff them out!

Comments:

1. Walter Schwabe Says: November 16th, 2008 at 2:03 pm

Alain, thanks for the mention and the great writing on my blog….

2. Alain Saffel Says: November 18th, 2008 at 11:51 am

No problem Walter. Glad I can help you out. :)