Social media is the conduit that connects advertisers to appropriately narrowed audiences, and best of all, the users themselves do all the grunt work of tracing the connections as they busy themselves in elaborating their identity and maintaining the friendships online.
Felix Salmon connects some dots in this post about social media and the future of commercial online publishing.
So advertisers, looking to reach a large audience online, are going to have to look past the simple question of whether or not people are paying for content. And they’re going to end up with a much more granular and useful way of working out who’s seeing their ads: social media.
The fact is that if I sign in to a free site using my Twitter login, I’m actually more valuable to advertisers than if I paid to enter that site. That’s because the list of people I follow on Twitter says a huge amount about me, and a smart media-buying organization can target ads at me which are much more narrowly focused than if all they knew about me was that I was paying to read the Times.
We’re not quite there yet. But it seems to me that online publications are making a big mistake if they make subscribers go through a dedicated registration and login process, because the demographic information they can get from that will be less useful and less accurate than if they outsource the reader-identification procedure to Twitter or LinkedIn or Facebook. And people will definitely enjoy an automatically personalized reading experience, where they can see what their Facebook friends are reading and what the people they follow on Twitter are reading.
Social media is the conduit that connects advertisers to appropriately narrowed audiences, and best of all, the users themselves do all the grunt work of tracing the connections as they busy themselves in elaborating their identity and maintaining the friendships online. The portable login is the key; it becomes the repository and access point for online identity. It's our virtual bar code, communicating our evolving demographic relevance to whomever we reveal it.
This, it seems, is the way social media hopes to make money in the future, by becoming the universal login that allows advertisers to target readers more effectively through the details those readers have willingly volunteered about themselves. This is why Mark Zuckerberg can write in this WaPo op-ed that "We do not give advertisers access to your personal information" -- ultimately it's not Facebook but us who give marketers that information when we use Facebook's login elsewhere.
The ads may enhance our experience of the sort of identity we want to be projecting -- they can serve as confirmation for us of who we think we are and thus be quite welcome. They help us consume ourselves. Just as people explicitly buy certain magazines for the ads, properly targeted marketing could function similarly. That is, we wouldn't want to block online ads, since the ads will have become our most flattering mirror. (Cue the Althusserian spiel from Judith Williamson's Decoding Advertisements.) And further, we won't necessarily worry about protecting privacy in social media when a wider circulation of this ersatz demographic-construct self is what we actually are after. We won't want privacy restrictions when what we are hoping for is to be surprised with a better version of ourselves in the ads we see.
UPDATE: Kevin Drum makes some similar points here. He likens the portability of social media logins to supermarket loyalty cards, which benefit not consumers or stores, but marketers.
Having thought some more, I think what connects this and the previous post about manufactured "near-misses" in gaming machines is this: We can be manipulated into enjoying what we would not consent to before the fact and would recognize as not being in our best interests, all enjoyment aside. Marketers, gaming machine makers, behavioral nudgers, etc., can structure situations so that we enjoy them when we are in them, catering to our common weaknesses -- our vanity, our laziness, our selfishness, etc. But because we respond doesn't mean we therefore endorse them.
It's pleasurable in the moment to almost win a jackpot, and it's pleasurable to have people respond to something we have indiscreetly shared on Facebook, and it's even pleasurable to have ads pointed directly at us that tell us how cool and important we are. But there's more to what's good for us than pleasure, and none of those manipulations of our momentary experience are necessarily good for us or society.