Why Google and Facebook need to go direct

In Google sets plans to sell users’ endorsements, Claire Cain Miller and Vindu Goel describe new ways that Google and Facebook are taking liberties with users who have had nice things to say about companies’ products and services in the past, in contexts where they didn’t expect their words to turn into personal endorsements (especially ones for which they are not paid). Specifically,

Google on Friday announced that it would soon be able to show users’ names, photos, ratings and comments in ads across the Web, endorsing marketers’ products. Facebook already runs similar endorsement ads. But on Thursday it, too, took a step to show personal information more broadly by changing its search settings to make it harder for users to hide from other people trying to find them on the social network.

(on the left) An example of a Google shared endorsement…

The problem, privacy advocates say, is when Web companies use or display the personal information of users in ways the authors did not expect when they originally posted it.

“People expect when they give information, it’s for a single use, the obvious one,” said Dr. Deborah C. Peel, a psychoanalyst and founder of Patient Privacy Rights, an advocacy group. “That’s why the widening of something you place online makes people unhappy. It feels to them like a breach, a boundary violation.”

“We set our own boundaries,” she added. “We don’t want them set by the government or Google or Facebook.”

There is a simple reason why Google and Facebook feel free to take these kinds of liberties: we pay them nothing, so they feel free to make us the product they sell, rather than the customers they serve.

This kind of abuse (and it is exactly that) will cost more value than it adds, for example with the Times story and this post. Even if the costs aren’t obvious on bottom lines, the negative externalities are large, and growing.

So here’s a simple suggestion for both companies: go freemium. Charge for value-added services, such as genuine, accountable privacy, within circles that customers (no longer just “users” or “consumers”) help define. We are legion, and you are increasing our numbers every day.

Online advertising is already post-peak and possibly headed toward oblivion, at least for ads that aren’t whitelisted by the likes of Adblock Plus. Ad and tracking blockers and enlightened browser makers, all working for the demand side of the marketplace, have their fingers on a pulse that Google, Facebook and the other ad-supported Web companies ignore. Enlightened as they are about their algorithms, analytics and infrastructures, they are literally senseless toward the consumers they sell to their customers — and the far greater return on investment they would get if lots of those consumers were customers as well.

A couple years ago I heard a Google executive say the company would never “go direct” because it was an “engineering company” and that didn’t want to make less than $1 million per employee. The implication was that going direct would require lower-wage and lower-skill workers in call centers — and other forms of non-engineering-type overhead. Yet there are plenty of highly profitable companies that do high quality service (call centers and all) with plenty of margin. For example: Apple and Amazon.

The writing is on the wall, big guys. Time to wake up and smell the demand for respect, privacy and genuine service. It’s huge.

And, if you’re ready to talk about it (or anything), come to IIW the week after next, at the Computer History Museum in Mountain View. It’s cheap. (Heck, Google is already a sponsor — and we do thank them for that.) It’s an unconference, so we can easily make “going direct” a topic there. (Hey, if you don’t, one of us will.)

Speaking of negative externalities, here’s the bonus linkage recommended by Zemanta:

• Google to Change Terms to Use Your Identity in Ads (dailyfinance.com)
• Google policy change: Your identity used (wptv.com)
• Google Will Start Using Your Photos In Online Ad Endorsements (getmybuzzup.com)
• Privacy advocates slam Google, Facebook changes (bostonherald.com)
• Facebook, Google hit on changes (bostonherald.com)
• Google Joins Facebook In Destroying Your Privacy (youviewed.com)
• Google will soon put your face, name, and content in its ads (arstechnica.com)
• Google can use your name, photos and comments in ads unless you opt out; policy starts November 11 (macdailynews.com)
• Google To Change Terms To Use Your Identity In Ads (sanfrancisco.cbslocal.com)
• How is Google using your personal data ? (parmenide.me)