Understanding the power of facebook’s open graph -Gigya - 2012

White Paper: Understanding the Power of Facebook’s Open Graph

Understanding the Power of Facebook’s Open Graph
With 800 million members and growing, Facebook appears to have a firm hold on the crown in online social networking,
which is both a term and an industry that didn’t even exist a decade ago. Since making the site generally available in
September 2006, Facebook has grown into one of the largest and most active Web sites on the Internet. Yet, as a soon-
to-be publicly traded company, it still operates in many ways like a Silicon Valley startup, a place where the product is still
under construction as it slowly revolutionizes the Internet and becomes a driving force of the global economy.

For many, Facebook has become just as much a daily personal experience as eating and sleeping. It’s a network of
interconnected communities where people of all ages - from teens to seniors and everyone in between - drop in daily to
share their thoughts, frustrations, milestones and adventures in words, pictures and sometimes even video. It’s where
they go to chronicle the events of their lives - often times with a mobile phone application to share where they are, who
they’re with and what they’re doing.

What’s interesting is that users are willing to share this much about themselves despite some stumbles around user
privacy in Facebook’s early years. The company not only has recognized and acknowledged those missteps but also
addressed them. The company has taken greater steps to evolve at a slower pace, one that allows users to fully test-drive
new features - such as the recent shift to a user Timeline - before rolling out a widespread changeover. It has also done a
better job of allowing users to “opt-in” to services that will be able to access their personal information.

With new features setting the stage for 2012 and beyond, Facebook continues to push the limits of what’s possible on the
Internet. Its latest push into an ecosystem of “frictionless apps” will catalyze the next Internet revolution, in part because
Facebook is inviting - not forcing - users to participate.

Facebook Apps: What are they and how are people using them?

It all started back in mid-2007 with the launch of Facebook Platform, which initially opened the Facebook.com site so
developers could integrate with Facebook’s “Open Graph.” This is what allowed companies like Zynga to create Farmville
and Mafia Wars, social games that exploded because of participation of the Facebook community. The Facebook platform
gave the game an interactive feel by reaching out to the player’s Facebook friends for help with the game - such as
visiting the virtual farm to help virtually water the virtual crops.

As the platform evolved, developers were able to integrate Facebook across the Web and devices, enabling users to
share something they were doing on another site, such as reading a news article, on their Facebook profiles without

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having to visit the Facebook site to post an update. Over time, users became more comfortable with sharing. They started
embedding YouTube videos of their favorite songs, posting links to articles from news sites, checking-in from restaurants
and sharing unsolicited reviews of meals, books, movies and so on.

At its September 2011 developer’s conference in San Francisco, the company told app developers about a set of
forthcoming features that would bring sharing to a new level. The first, called Timeline, would reinvent the look and feel of
the user profile by turning shared moments on Facebook into life events on a user’s life timeline.

The second was a significant update to Facebook’s Open Graph, the complex map of Facebook users’ connections. The
update promised to open the floodgates to the possibilities of how people interact with other Web properties and how
those interactions were shared via Facebook.

What’s new with Apps? Are people interested?

In early 2012, Facebook formally unveiled the Open Graph update for everyone on the Web, kicking it off with the help of
60 partners that will help transition users from simply “liking” things on other sites to “reading,” “listening,” “visiting,” or
other verbs that define what they’re doing on the Internet. For example, similarly to how people are “listening” to certain
songs on Spotify, they’ll be “cooking” a meal they found on Foodily or “shopping” for a car on AutoTrader.

Facebook isn’t just expanding the type of sharing that goes on within its network. It’s also automating that sharing by
making the process “frictionless,” essentially allowing an app to post, for example, the music that Facebook users are
listening to on Spotify without users having to go in and manually post those updates. Some have said that Spotify, which



was part of a test-run of the concept, saw rapid growth in the U.S., in part, because of its integration with Facebook’s
frictionless sharing.

For users, frictionless sharing reshapes the Web experience by exposing Facebookers to a whole new ecosystem of
influence – one where users can not only share what they’re reading but also see what their friends are reading. Through
this system, users are being exposed to the tastes of their Facebook friends, a group that tends to be much larger – and
diverse – than the group of friends they hang out with during offline hours.

For businesses, it’s an important shift in the way products are marketed because, through a network of Facebook
connections, influential viral marketing shifts to a potential audience of 840 million (and growing) – much larger than any
national TV audience. By comparison, this year’s Super Bowl generated an audience of roughly 111 million viewers – a
fraction of the potential Facebook reach.

Imagine how a restaurant owner, for example, might value a customer letting his Facebook friends know that he was
“enjoying a meal” - instead of just “eating” at the restaurant. Imagine that owner being able to reach out to customers who
didn’t enjoy the meal - and said as much on Facebook - to come in and give the place another try, perhaps with a
discount. Imagine that owner getting updates that some of his regular customers at the law firm down the street will be
working late, an opportunity for him to reach out and offer to prepare dinner for the group.

It’s a new level of interaction on Facebook because it’s not just about friends connecting with friends anymore. These new
Open Graph applications essentially grant access to those Facebook details - with permission from the user - in order to
deliver a better sharing experience. Eventually, once the app learns more about a user’s tastes, likes and dislikes, it can
serve up customized information - perhaps an update about a car model the user has been researching online, some
weekend specials at one of your favorite restaurants or a ticket giveaway contest from the local radio station.

Now, companies who interact with customers on Facebook - whether a car dealer, restaurant owner or concert promoter -
can create Facebook action verbs that define the customer’s relationship to the company. Think of it as viral marketing to
engaged, friendly audiences.

It’s too early to gauge the receptiveness of this Open Graph application model but the slow rollout of these features, along
with a launch that centers on sites that likely would spark sharing - music, video, cooking and sports, among others -



could generate some buzz among the Facebook faithful. Facebook has been careful to give the users control of the tools,
recognizing that privacy is important to users and that eventually – through viral sharing – they tend to flock to new
features.

In a TechCrunch blog post, blogger Josh Constine explained that active sharing by users is replaced by automated
sharing, a move that could increase the “noise” on Facebook and require new actions by some users. He wrote: “...we’ll
need to learn to filter out the noise in reverse, opting out when we don’t want to share instead of opting in when we do.
That’s a huge behavioral realignment that will take time and won’t come easy. If learned, though, we’ll be able to dance
across the web from one piece of great content to the next, sharing it all effortlessly, and only having to stop when
something deserves to be struck from the record. And as algorithms improve to show us what’s most relevant, we won’t
have to un-share as often.”

Sharing is a personal thing - but technology has taken us to the point where algorithms make it possible for automated
systems to actually learn about us - our tastes, our comfort levels with sharing and even those who most frequently
engage in discussions with us. Just as Google has refined its page-ranking algorithms over the years to make the search
experience more personal, Facebook has also been updating the news feeds based on a number of algorithms, such as
the types of connections we have with people.

Industry watchers have suggested that Facebook has struck just the right balance with this new feature by creating a
system that relies on transparent, permission-based access. Even though many users tend to accept terms and
agreements for sites and software without actually reading them, Facebook has gone to great lengths to put the
information in their faces - specifying the types of information that the application will access and incorporating a drop-
down tool to change the privacy settings before approving access by the app. No longer do users have to go back and
adjust their privacy settings after the fact.

Why should I be interested?

Internet search was a Web-changing tool – one that allowed us to research specific information by tapping a few
keywords into a massive index of the Web’s content. And while search remains important, Facebook is tapping into the
power of content discovery by reaching out to the very network of people who already help us discover relevant content –
our friends. Great content - whether it’s a funny video clip that made a co-worker laugh, an image of the newest member
of the family or a link to a news story that a group of friends is buzzing about - is found by scrolling through friend-powered
social media, not by searching for “funny video clip” on a search engine.

Any company that understands the significance of a professional web site as a tool for maintaining an online presence,
drumming up new business and interacting with potential customers should have little trouble understanding the power of



Facebook’s Open Graph. Over time, Facebook will top 1 billion users and the app economy will gain traction. Companies
that aren’t implementing Facebook’s expansive features are already behind the competition.

Facebook, just like Web pages and email accounts a decade ago, is increasingly becoming a business tool that cannot be
ignored. Certainly, the traditional Web site is still a primary element of business – but it’s no longer a stand-alone
presence. Through integration with Facebook’s Open Graph, a site can enhance that online presence by allowing users to
interact on-site using their Facebook identities, exposing the site’s content and making it easier to share across the
Facebook ecosystem – and economy. It revolutionizes the way companies and customers share information and interact
with one another.

But it’s more than just that. Facebook is a treasure trove of data that says so much about a person - where they work, how
many kids they have, where they vacation, which teams they root for, which movies they like, their favorite types of foods
and, of course, their political leanings. Building an app just to gain data that can be sliced, diced and analyzed down to the
granular levels is reason enough to jump on-board. After all, regardless of the type of business or app, that sort of
permission-based data gives companies insight into behaviors and patterns based on gender, demographics, region, age,
education levels and so much more. Users already share so much information about themselves on Facebook that the
data being collected would be valuable to any company trying to reach a clientele.

It’s also worth noting the economic implications of this new Facebook application ecosystem. Before the company
announced its plans for the Open Graph update and Timeline, the app ecosystem within Facebook was already
generating some buzz. A University of Maryland study released in September 2011 looked at Facebook’s economic
impact in the nine months prior. What it found was, mostly through its gaming apps, the Facebook App economy had
created nearly 200,000 jobs in the U.S. in 2011 and added more than $12 billion in wages to the U.S. economy.



As other industries work to get a piece of that Facebook economy, those numbers will grow exponentially - just as other
App ecosystems, such as Apple’s app store and Google’s Android market, have flourished. Given the size of the user
base and the existing comfort levels those users have with sharing, it’s only a matter of time until Facebook is right there
next to Apple and Google as an application powerhouse.

What’s next for Facebook?

The thing to remember about Facebook is that it doesn’t update just to make itself look prettier. With every change, it’s
broadening its reach and taking the concept of sharing - as well as watching, listening, eating, buying, playing - to new
levels. It’s breaking new ground and pushing the limits of what it can do by giving Facebook users - whether individuals or
businesses - tools and features that they didn’t even know they wanted.

No one knows exactly for sure what Facebook has up its sleeve for the future but this much is true: it’s been a constant
evolution with Facebook, a series of upgrades that built on the idea that Facebook is more than just a Web site or online
community. Unlike predecessors who built large online communities – such as AOL and Yahoo in the past – Facebook
didn’t just add more feature sites, such as jobs, finance and sports. It embraced what the Web was already offering and
has adapted to not only be receptive to new types of interactive Web properties but to also influence how those sites will
evolve and grow. Recognizing that, it’s easier to see how interactive apps, social commerce, targeted advertising and new
connections will continue to be a part of Facebook’s next offerings.

I’m sold. Now what?

The biggest challenge for a company looking to tap into Facebook’s tools and resources is that Facebook is a fast-
moving, constantly evolving ecosystem. It’s a web within the web - and on mobile platforms, too.

Maximizing exposure on Facebook and tapping into all that it has to offer is a full-time effort. The cost of doing business
today includes a budget for IT needs, as well as Web development. Today, social media strategies and implementation
are just as important as a powerful Web presence - maybe even more important - and should be part of a company’s
investment strategy.

Trying to handle social media as an afterthought or pawning it off on an intern is one of the biggest mistakes a company
can make. The best bet is to work with a company that not only understands how social media works but also knows how
to incorporate social media tools into daily business operations, and most importantly, on the company’s Web site.

Recognizing the power of Facebook and the importance of integrating social identities across the Web, Gigya offers a full
suite of social applications such as Social Login, Share, Comments and Gamification that allows sites to offer an engaging
on-site experience that deeply integrates with Facebook and other social networks. But Gigya also understands that
integration is only one piece of the social media puzzle for businesses. Gigya’s Social Identity Management Platform digs
deep into the data, allowing businesses to collect and store permission-based social data and on-site activities so those
businesses can understand and target users like never before.

Relying on a Web page and good search engine placement might have been enough for a company to promote itself a
few years ago. But as social media – and social identity – gains more traction and becomes a more powerful force in
personal interactions and communications, it’s safe to say that an investment in social integration is a must-do for today’s
serious business decision-makers.


Understanding the power of facebook’s open graph -Gigya - 2012

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Understanding the power of facebook’s open graph -Gigya - 2012