Brands Create Customers

A few months ago I proposed that the best way to change the game in any industry is to change the customer. We can now see this process of changing the customer unfolding at a meta level in leading social network sites, such as Facebook. As these sites offer broader and deeper communities for their members, they’re creating a new community-based “social customer” whose needs may not be met by traditional brands. Yes, new social sites are changing the customer and changing the game for brands themselves.

MySpace, LinkedIn, Mebo and Facebook are prominent social sites, but today I’ll focus on Facebook because it’s making big news with its innovative Facebook Platform. What sets Facebook apart (for the moment, anyway) is that its new platform allows third parties to develop software applications to run inside Facebook itself. It’s as if Facebook took the classic “closed portal” model and turned it inside out, giving members virtually unlimited choice of applications they might use.

Facebook as a platform of opportunity

Facebook thus becomes a platform of opportunity for three beneficiaries:

1. For Facebook members — as a richer platform for connecting with each other and sharing experiences
2. For application developers — as a potential market for innovative apps
3. For brands — as a new way to connect with customers, and to reshape brand identity.

Brands stand to benefit from Facebook’s platform approach, but they can’t fall back on “messaging” and brands-as-usual.

How Facebook is changing brands

With its new platform approach, Facebook is changing brands in three important aspects:

1. Facebook is creating a strong community context that can challenge the marketplace context where brands have traditionally flourished. In the Facebook context, the individual and his/her community are the focus of meaning; they’re at the center of the universe. Given this social centrality, traditional marketplace brands can appear as outsiders, as less authentic, and can fall to a second-tier.
2. Facebook enables a new mode of brands as personal applications, elevating brands from the static and symbolic to the functional, with new avenues to create customers. Brands can experience rapid, viral growth through Facebook communities when they’re a means of getting things done.
3. Facebook’s new platform raises Facebook itself to a unique brand presence as a network of expression, a happening “place,” and a true “relevance engine” based on users themselves. This raises the bar for brands. Brands without an innovative digital strategy (and deliverables) may simply go the way of these guys.

The Facebook Platform

As noted above, the Facebook Platform is important because it opens Facebook to third-party software applications, greatly expanding Facebook’s capability to serve member needs. A brand that provides value can gain a significant (free) presence on the Facebook platform in the form of a widget (a concise application) that enables members to do something gloriously useful and unique—in some context of the brand. Applications are integrated into Facebook’s look and feel, are intended to be shared, and can access (with permission) user data across Facebook’s 38 million members. See here and here, and especially Mark Andreessen’s comments here.

The challenge to conventional brands

To a large degree, Facebook and other social sites are in the connection business. The more they enable members to connect to (and shape) their personal networks, the more they thrive. In this process, a member’s group identity, support and social connections may ultimately take precedence over product and company connections that brands try to establish. One’s social network becomes an all-encompassing filter. In a context of strong social connections, where the individual is nourished by personal affiliations, exterior brand connections may be harder to establish, and sustain.

Let’s now explore the three game-changing areas where Facebook impacts brands. Other social sites may have similar impacts, as well.
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