Can Facebook Connect Turn Social Media Data Into Profit?

With the election behind us, we Americans have re-focused on what really matters: shopping! Forrester’s newest report projects a 15 percent% increase in online retail sales this holiday season over 2011. Much of this $68.4 billion pie will be eaten up by the big boys -“ Amazon,, and other giants.

But you don’t have to settle for the crumbs. The steady consumer adoption of Facebook Connect, combined with game-changing analytics and personalization technologies to turn Facebook activity into marketing firepower, have dramatically leveled the playing field.

Now David can beat Goliath. Here’s how.

First, you gotta Connect
The secret of the e-commerce titans is not just their size -“ although that helps -“ but their excellent service. And one key element of that service is personalization. These businesses are able to better serve their users because they know more about them!

Now any business can know as much -“ or more -“ about a given user than all the information that Amazon and Google have been collecting on us for years. How? Through Facebook Connect.

The real brilliance of Facebook Connect is not just that it saves the user from having to memorize a new username and password for every site that he visits. Rather, it’s the data. The data that a user consensually shares via Connect can easily eclipse the prior purchase behavior that drives the current state-of-the-art in personalized recommendations, so-called “collaborative filtering” technology.

Social analytics companies are now introducing new technology that takes advantage of Facebook Connect’s increasing popularity and makes sense of the billions of social data points found on Facebook to turn them into profitable insights for your business.

Curing the common ‘Cold Start’
The biggest problem that retailers face is that they generally don’t know what their users are looking for until the user expresses a purchase intent. And prior purchases -“ if the retailer even has access to them -“ are not necessarily great indicators of future buys. The key is to understand who the buyer is today and to help him or her discover what they want on your site before they surf elsewhere.

Facebook data allows retailers to solve this “cold start” problem of not knowing much about their first-time visitors. And that’s how David can beat Goliath. For this new technological sling promises new profits to businesses and a better experience for their customers.

Retailers along with pure-play etailers looking to boost online profits should focus on two key elements to better understand and serve their users.

First, they need to gather a clear “macro” view of all their Facebook Connected users by summarizing key demographic segmentation and user interests, both declared and inferred. This macro analysis is critical to understanding who your users are and reducing new customer acquisition costs. For example, once a retailer discovers that a large part of their engaged audience comprises teenage girls who love Rihanna, they’ll know to target more of their ad spend on similar demographics -“ the low hanging fruit.

Second, they need to delve into the “micro” level to personalize the user experience on the retailer’s site. So if you’re a middle-aged man who’s constantly posting status updates on Facebook about the 49ers and football, you won’t see purse recommendations when you visit an online retailer (unless its for your wife’s upcoming birthday). Rather, you’ll see items directly related to your explicit likes and implied Facebook interests. This “social personalization” is a game changer that promises to dramatically boost user engagement, turning what used to be cold starts into hot purchasers.

And it’s this personalization-driven strategy that will empower businesses to close more deals, engage their users, and make one-time visitors into repeat customers.

The road to profits has never been easy, but social media and innovative startups have just paved a brand new path to success. So this holiday season, remember to Connect with your users and make sure to take a piece of the $68 billion pie for your business.

Shahram Seyedin-Noor is an expert on the intersection of “big data” and social media marketing. He is the co-founder/CEO of GraphDive, a data analytics startup focused on delivering profitable insights to businesses from social media activity. For more information, visit