Impacts

With the Social Graph API, external sites can now host facebook like features and publish and connect people to their social circles within the context of this external site. With the right amount of user participation one’s social circle may influence one to participate with the external site/offering, whereas previously that level of comfort to engage with an external site may not have existed. This is helpful for all involved parties. Additionally, retailers can track and offer incentives for people promoting their brand.

Hurdles

Google! While Facebook is starting to explore this new avenue of connecting people to the web via their friends (or friends or friends, etc), Google already has massive amounts of data about its users via its own services such as gmail, Google Search, Subscriptions, Android mobile. Google also houses massive amounts of data over the web and via its Ad Words (advertising), it’s own services, and the web it pretty much has more than enough information to connect a users’ or demographic’s pattern to better understand how best to serve the web to its users. See the illustration below.

Facebook's Vs. Google's Strategy

Participation is a critical component if facebook’s Social Graph API strategy needs to take off.  Firstly, organizations need to be interested in connecting with facebook. Some industries such as fashion, music, etc will greatly benefit from this and so they may be the first adopters. However, it will be important to have a lot of these web sites participate. Additionally, it is also important for consumers to participate. Most people would rather be seen not promoting any one specific brand. If organizations can figure out a way to incent people (i.e. reward them without making them look like an Amway sales person), then consumer participation may not be so much of an issue.

Conclusion

Facebook is definitely transforming itself into a more pervasive entity on the web with the Social Graph API. This opening up of facebook, where external sites now can now connect with individuals on a more personal level surely has the potential to transform the way customers interact with products and services on the web. However,  Facebook has a long road ahead of it especially with Google way ahead in this race.

Artwork/Thumbnail by Gauldo on Flickr

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