It’s been a month since I wrote Pandas and Lobsters, and I’m ready to delve further.
Whales and Lobsters are the foundation of social networks, and Facebook is a machine for turning Whales into CASH. Let’s explore why, and the implications…
The hype around this week’s launch of Facebook Places is misguided. Facebook Places are not about check-ins; they’re about making millions of new Facebook Pages that are monetizable. Foursquare is a sideshow; Twitter is currently Facebook’s main competition for public, lurkable, searchable, transactable Pages for brands. If someone asks why Facebook wants to be in local Pages, echo the immortal words attributed to bank robber Willie Sutton: “Because that’s where the money is.“
To understand why, we once again zoomorphize the Facebook population:
Lobsters are individuals with Facebook Profiles. Facebook is a lobster trap and your friends are the bait. A lobster has a ganglia-brain the size of a grasshopper’s, and no attention span, so frankly the most useful thing it can do is get laid. Male lobsters try to mate with almost every other female in the area, which makes male lobsters very annoying. Collectively they are the reason why Facebook has more pageviews than the next 99 biggest websites combined.
Whales are brands with Facebook Pages. Brands encompass both individuals and businesses. Facebook Profiles are painfully unusable for Whales because in general they have more friends, fans, and followers to interact with than an individual with Facebook’s tools can reasonably manage. If how Facebook makes CASH is the question, whales are the answer. Whales are the lifeblood of Facebook financially: they are the brands who in aggregate pay more than $1 billion annually to Facebook, Inc., to advertise their Facebook Pages and collect more fans for those Pages via billions of daily LIKE buttons.
Whales and Lobsters are the foundation of social networks, and Facebook is a machine for turning Whales into CASH. Whales create and share publically, and pay actual CASH; Lobsters consume privately, and occasionally LIKE and comment publically, and pay attention (and time). In the best social networks this creates a virtuous cycle: Celebrities and artists interact with fans, while businesses and organizations interact with customers, and social networks allow the Whales to build deeper relationships with their fans and customers. And vice versa. LIKE a palindrome. LIKE, totally.
A click’s just a click, but a LIKE is a LEAD. Ongoing relationships are the key difference between the mere clicks Google advertisers pay for and the potentially-interactive LIKEs Facebook advertisers pay for. AdWords and AdSense account for 99% of Google’s profit. This is why Google has taken notice (though someone should point out to Google that Like.com has nothing to do with all the billions of daily LIKE buttons they see on the Open Web).
Facebook has only 3 million Whales — Branded Individual and Business Pages — that collectively represent only 5.3 billion clicks of the LIKE button thus far. Facebook by the Numbers hides this fact behind all the statistics about the 500 million Lobsters: the average Facebook user LIKEs fewer than 10 Facebook Pages (divide 5.3 billion by 500 million). And you have to look very carefully to realize that most of the total 5.3 billion LIKEs were unpaid or forced conversions.
Since Whales and LIKEs are essential to Facebook’s revenues, the race is on to win the minds and hearts of Whales and the Lobsters who LIKE them. Facebook may look like Winner Takes All presently, but that’s because Twitter hasn’t really entered the market of charging Whales for LIKEs… yet. Now you may ask yourself: how many Whales and LIKEs does Twitter actually have? It’s a good question because Twitter is pretty tight-lipped about these numbers. But I can guess.
Now, the early bird gets the worm. The early worm gets… eaten. Is Facebook the annelid in the New Whale Order? Yes, if Twitter can learn enough about what Facebook offers its Whales in exchange for CASH — with the LIKEs and the age-sex-location demographics and the pretty pictures that illustrate funnels. We’re not talking about fixing the unusable mess that is Twitter search or developing the rocket science that is Google Analytics. We’re talking something much simpler and emotionally satisfying than anything Google can provide: Local businesses using the Web to build relationships with their customers. Tweet, and your customers tweet with you; Google, and you Google alone.
My guess is that Twitter already knows everything I just said, and is quietly employing Lesson #4, Part 3: keep your mouth shut.
No wonder Twitter is so… quietly nonchalant. Look carefully, and you’ll see in their eyes the kind of calm that comes from knowing something profound that others are only beginning to wrap their heads around…