Facebook Turns "Like" Button Into Two-Way Street, Challenging Amazon for Buyer Data

Last Updated Jul 26, 2010 2:55 PM EDT

[Editor's note: As part of a major BNET redesign, Chris is moving to the new Upwardly Mobile blog on the site. As of Thursday, you'll be able to find him here: http://www.bnet.com/blog/mobile-internet. You'll be able to find all our business-news blogs at our new home in the Commentary section here: http://www.bnet.com/news. Thanks in advance for your patience.] Facebook has just announced that it will allow publishers to contact users who have "liked" a page by inserting things into that user's News Feed. The new feature may annoy users, and that may be the idea. By providing an incentive to use their "likes" wisely, Facebook will help turn the Like button -- once a relatively blunt instrument -- into a much more refined tool.

The Like button has a very specific purpose, but until now, it wasn't very good at its job. Like Amazon's (AMZN) huge catalog of past purchases, or Mint's (INTU) new "saving" features, Facebook's Like button is an experiment in purchase data: it's meant to figure out what you, the user, would like to buy. But unlike Amazon's data, which is based on actual things you bought, or Mint's system, which asks you what you'd like to save up for, the data Facebook's Like button collected was susceptible to all kinds of inaccuracies.

As Ad Age wrote in May:

[The Like button] is tough to choke down even for a data junkie at his weakest. If you show me a cheeseburger and ask me if I "like" it, at any given time of day, you are likely to get a different answer each time. Even when I like something, I may not feel compelled to click "like" unless, of course, there was some benefit to me.
As I argued at the time that the Like button would be susceptible to false "likes," clicked out of boredom, or out of profligacy, or simply because someone set up an SEO-style system that encouraged people to "like" something for some kind of reward.

But making the Like button into a two-way street means that there are consequences to hitting every Like button in sight. It will turn the News Feed into a kind of inbox where publishers whose stuff you've liked can now try to push more of their wares in front of your eyeballs. (If you "liked" a product on the Sears (SHLD) site, for example, Sears could stick ads for more products into your Facebook News Feed.)

This disincentive may help insulate against illegitimate likes. But Facebook isn't stopping there: it's also providing tools to help add qualitative information to the button. The company has also built out the ability for the Like button to take comments and publish them in friends' News Feeds, and has also improved analytics on the button. As the Facebook developer site says:

Now, when a user adds a comment to the iFrame version of the Like button, a larger, more prominent story will be shared with the user's friends. In the past, we've seen comments result in increased distribution and referral traffic.
Even with these refinements, we've only begun to see the potential of the Like button.

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