Facebook Permissions Authorization Rates Remain High Despite Privacy Concerns

  

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2012 was a year of significant changes to Facebook’s sharing policy.  Initiatives such as Open Graph Publishing and Seamless Sharing raised concerns from the public and the media that Facebook users would resist the increase in automated sharing on their behalf, particularly around authorizing Facebook Connect with third party applications.

At Sociable Labs, we last studied Facebook Permissions authorizations in December 2011, before Facebook’s most recent raft of changes, and we thought it would be insightful to revisit the question a little over a year later.  The question we examined is “What percentage of users will accept a Facebook Permissions authorization prompt and how has that figure changed in the last year?” Our research indicates that there has been no meaningful change in authorization rates in the last year, with an average rate across our customers of just under 60%.

Methodology

Data for the study was collected with Facebook Insights using all Sociable Labs customers that had deployments of Sociable applications on their websites in both 2011 and 2012. We compared accept rates during the one-month period from 19 November to 18 December of both 2011 and 2012 to determine if there had been a meaningful change in the rate at which users authorize Facebook Permissions prompts. Averages were calculated as the ratio of total accepts to total impressions, summed across all customers.

Additionally, we calculated acceptance rates for all Sociable Labs customers for whom data was available during the last 12 months, again using data collected with Facebook Insights. For this same period, we also calculated the acceptance rate when the authorization was being used for registration only.

Results

During a one month period spanning November and December, there was no significant change in Facebook Permissions acceptance rate between 2011 and 2012. The 2011 accept rate was 55.6% and the 2012 rate was 56.6%. Total impressions during these periods was just under 400,000.

Overall acceptance rate for the entire 12-month period from December 2011 to December 2012 for all Sociable Labs customers for whom data was available is marginally higher at 59.4% of nearly 3.8 million permission request impressions.

Permissions for Registration Only

When the authorization was requested for site registration only, as employed for “Login with Facebook”, the accept rate rose to 68.8%. The actual accept rates are even higher when discounting one outlying customer that had an abnormally low acceptance rate but accounted for a significant portion of the data (30.8% of all impressions for the period).  Therefore, the nonweighted average of all customer acceptance rates, 75.7%, is a more realistic picture of the acceptance rate when permissions are requested solely for the purpose of using Facebook for site registration.

Conclusion

The results show that despite growing concerns about privacy on Facebook, particularly as sharing becomes more automated, users are continuing to authorize Facebook Permissions at high rates. Compared to one year ago, the current rates are about a percent higher during a one month period, and over the last year in its entirety, authorization rates are nearly 60%, and more like 75% if the permissions are requested only those required for the purpose of “Login with Facebook” in lieu of creating a site password.

This finding is promising because it indicates that the fundamental premise of social commerce, that users are willing to share personal social data with online retailers, is a) sound and b) relatively inelastic. That is, even in the face of controversy surrounding Facebook’s evolution of how social information is shared, users seem unfazed and are still willing to authorize permissions. It is worth noting that, as always, good user flows, application design, and a clear benefit to the user will incentivize them to authorize permissions.

Study on Log In with Facebook and the 2012 Internet Retailer 500

  

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Today we released a research study that we believe will be very helpful for any online retailer who is considering implementing Log In with Facebook.  In particular, we reviewed how the top 500 online retailers integrated Log in with Facebook as an alternative option for their account creation, site registration, and site login processes. Sociable Labs’ study of Log in with Facebook usage by the IR 500 was restricted to this use case only — simply whether Log in with Facebook is integrated with the core e-commerce site for user account creation. Sociable Labs did not study other use cases for Facebook Platform, such as Social Plugins (i.e. Like buttons) or other onsite social applications that utilize Log in with Facebook.

Sociable Labs found that adoption of Log in with Facebook by the IR 500 is still in its beginning stages with 30 of the top 500 online retailers having implemented Log in with Facebook into their account creation process today. This remains an untapped opportunity area for most of the IR 500, who have yet to take advantage of the many benefits that Log in with Facebook affords: simplified account creation, elimination of required site-specific passwords, increased onsite personalization, richer CRM data, and increased referral traffic from Facebook. Sociable Labs believes that the major factors hindering adoption include technical barriers to implementation, perceived security concerns, and level of effort required for implementation. Many of these barriers will be removed over time, which should spur continued adoption of Log in with Facebook by the IR 500.

Facebook is by far the dominant Social Login option chosen by these online retailers. All IR 500 sites that have implemented a Social Login solution include Log in with Facebook. Furthermore, 77% of these sites only offer Log in with Facebook. Sociable Labs believes that online retailers will continue to prioritize Log in with Facebook over other forms of Social Login (Twitter, Yahoo, Google, etc.) as Facebook continues to advance its offerings around Facebook Platform.

The majority of IR 500 sites that offer forms of Social Login other than Facebook have done so by utilizing a third-party software vendor such as Gigya or Janrain. However, only 17% of the IR 500 that have implemented Social Login have chosen to do so via a vendor. The majority of the IR 500 that have implemented Log in with Facebook have done so independent of third-party software, which is why Sociable Labs believes Facebook will remain the primary, and only, social login option offered by most online retailers.

Sociable Labs also found that a large percentage of IR 500 sites that have implemented Log in with Facebook have done so incorrectly, or are not leveraging best practices. A full 30% of those who have implemented Log in with Facebook have done it incorrectly by requiring the user to create a site password in tandem with Log in with Facebook. Exactly half of those who have implemented Log in with Facebook have yet to offer it during the checkout process, missing a big opportunity to generate more usage and provide a consistent user experience. None of the IR 500 that have implemented Log in with Facebook are taking advantage of one of the primary benefits of Log in with Facebook — Persistent Login—to automatically login users on return visits.

You can download the full study here: http://www.sociablelabs.com/download-login-study

Four Frequent Mistakes in Social Marketing

  

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Any retailer swimming in the social media waters the past few years has heard the word "engagement" a million times, and for good reason. Engagement is key in driving word-of-mouth endorsements. However, engagement and word-of-mouth are really a prelude to the ultimate goal of driving increased sales.

The problem with most social engagement strategies is they don't actually increase sales. In fact, Forrester's recent State of Retailing Online study (SORO) found that 62 percent of retailers' social marketing return on investment is still unclear. As retailers look beyond engagement to ROI from their social strategies in 2012, here are four mistakes to avoid:

1. Counting on Facebook fan pages to drive sales. Retailers have invested a lot of time and money into Facebook fan pages, trying to build a large fan base and engage them with weekly posts and promotions. This contradicts the true spirit of social — i.e., connecting with and empowering consumers. The socially empowered consumer now expects input and advice from peers, not from manufacturers or retailers. It should come as no surprise that traffic from Facebook fan pages isn't driving sales.

Recommendation: Capitalize on your existing ecommerce investments by engaging your website visitors with social features that cause consumer-to-consumer sharing. Word-of-mouth sharing will help drive traffic to your ecommerce site, where you're best equipped to convert it.

2. Relying on the 'Like' button to drive sharing. Early attempts to drive consumer-to-consumer sharing on ecommerce sites centered on the Facebook "Like" button. The click-through rate has been extremely low as there's no clear reason or benefit for consumers to like a product while shopping. What problem does that help them solve for them?

Recommendation: Provide engaging social experiences tailored to your target consumers that present compelling reasons for them to share with friends. Prioritize solutions that leverage user interaction data on your site as well as full social graph data about the user and their friends on Facebook. This will ensure you present the most relevant experiences at each step in the shopping process.

3. Waiting for a well formulated social roadmap to start. While the potential revenue that on-site social applications can generate is huge, waiting to create the ideal social roadmap may actually reduce your chance of success. It's hard to predict what will work best with your customers and your product categories. To make matters worse, while you're busy planning and building consensus across the company, your competitors can dive in and start getting real customer feedback to know what really works.

Recommendation: If you don't already have Facebook-trained engineers and product managers on staff, you may want to partner with a social commerce vendor regardless of your plan so you can get started quickly and get that feedback. You should pick a partner that allows you to easily test and improve upon different social experiences across your site (and yes, Sociable Labs does offer that capability). Because social commerce is still in its infancy, rapid experimentation and testing is key to generating the highest returns.

4. Looking for the social 'silver bullet.' Social technologies are evolving fast (as is consumer social behavior). Forrester's recent SORO study shows there's no proven solution in social marketing, though efforts to integrate social features on ecommerce sites have proven to work the best so far for growing sales.

Recommendation: Look for a social solution that provides a wide range of on-site social experiences explicitly aimed at increasing the metrics that matter most, namely referral traffic and site-wide conversions. Customize these experiences to your specific products and users. Solutions with built-in A/B testing capabilities ensure the greatest opportunity to know what works for your business and what doesn't, allowing you to optimize for the greatest user participation and overall lift in sales.

The Top 5 Social Commerce Disruptors in 2012

  

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2011 was a big year for ecommerce and 2012 promises to be even bigger as social commerce continues to emerge as a key source of traffic and sales for online retailers. Here are the top five trends in social commerce that I predict will have the most impact in the coming year:

Going beyond the "like": To gain greater value from the Facebook social graph, e-commerce sites will begin to allow visitors to do more than just "like" a product. At the most recent f8 Developer Conference, Facebook announced its plans to enable more types of user actions to be shared, such as "read," "watched" and "listened." In 2012, e-commerce sites will begin to define their own social actions, allowing consumers to indicate what they've bought or reviewed, or even indicate what items they are shopping for. Given that 50% of visitors to e-commerce sites are logged into Facebook while shopping, these types of social features will prove to be popular with consumers in 2012.

Platforms open wide: One of the biggest inhibitors to integrating social into the e-commerce experience over the past two years has been the technical challenge. Vocal demand from retailers has driven most of the major e-commerce platform providers to adapt, making their platforms much easier to integrate with third party services. eBay's X.commerce announcement is the most visible example of this trend, but every major e-commerce platform has made social integration a big part of its roadmap in 2012.

More deals, every day: 2011 was the year of the local daily deal, led by Groupon and Living Social, amongst others. The daily deal phenomenon proved that consumers don't want to miss out on a phenomenal deal, even if they had little-to-no purchase intent for the item or service being offered. Online retailers were quick to realize that the Groupon model could be applied to their own websites, and I predict that this trend will only accelerate in 2012. The daily deal will become a mainstay of the e-commerce environment for years to come.

Celebrity-driven marketing: Our celebrity-driven culture extended into online retailing in a big way in 2011, and we'll be seeing plenty more in 2012. After several years of building Facebook fans and Twitter followers, social media-savvy celebrities became a key asset to the marketing strategies for many online brands. The success of ShoeDazzle, which rode Kim Kardashian's popularity, set an example for the industry. In 2012, we'll see more sites use celebrity muscle to push traffic to retail sites — like Fab.com, which got Demi Moore to tweet about some of its early sales, and BeachMint, which co-presents products from Kate Bosworth, the Olsen sisters and Jessica Simpson.

Shopping less but spending more: Shoppers with more cash than time will be courted by sites that offer personalized shopping services, digging up only the deals and the products that the shopper will jump on. Services like Shop It To Me act as virtual personal shoppers, saving their members the hassle of scouring sites for deals. Services that rent products, like Rent The Runway, will unlock new ways of consuming products. New forms of shopping with social twists will continue to spread in popularity fueled by strong word of mouth via social networks.

Warm Welcome to James Donelan, new VP of Engineering

  

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I am excited to announce the newest member of the Sociable Labs team, James Donelan. As our new VP of Engineering, James brings more than 15 years of technology and software engineering leadership experience to the company. He comes to Sociable Labs by way of Lithium Technologies, where he was the VP of Engineering, responsible for managing architecture and engineering for their enterprise platform which hosts more than 250 social communities with billions of transactions per month.

We are at an inflection point in the industry when online retailers and consumers can now reap really meaningful benefits from consumer-to-consumer social marketing. As a result, our company is growing rapidly to meet the need, especially in engineering. James is a great leader of fast growing development organizations, and has an outstanding track record leading successful enterprise-level social commerce projects. The fit couldn't be better, and we're looking forward to his leadership as we scale!

We just issued a press release announcing James' appointment, which can be viewed here.

Sociable Labs’ Reading List

  

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