How to make people stop hating Facebook

There has been a lot of griping about Facebook lately.  IPO trouble, privacy concerns, the “what is this doing to society and do I really want to contribute?” crowd.  They’re getting slaughtered in the press, on Wall Street, and in the court of public opinion, and they seem to be doing shockingly little about it.

I’m not a heavy Facebook user; I go on mostly to answer messages or, if I’m travelling, to see which friends are in town (I can never keep track of where people are).  And as a social psychologist, I have serious reservations about any system that propagates a curated life, because people start thinking that it is reality and wonder why their life sucks in comparison.

But all that said, I’m not trying to burn Facebook to the ground.  So here’s my tip for making the world not hate them: tell us, in several very short sentences, how you make money.

I actually think the business model mystery is a huge part of Facebook’s PR nightmare.  A good friend recently pointed out that Amazon also has a ton of data about us, but we’re not concerned, and that point is fundamental to my theory here: people hate Facebook because they have no idea how it works and yet it is big and important.  So they invent bogeymen.

If you ask the average person on the street how Amazon makes money, they’ll tell you.  Sure, it might not be in incredible detail and they may not have a great understand of why they are a high volume, low margin business (they may not even know what volume and margin are).  But they still essentially understand how stores work: they sell us stuff for more than they buy it for, and the difference is profit.  They get why it is a $100B company.

Ditto Google, which may be a more fair comparison.  Google is a huge internet name that confounds most folks, but when you ask my parents how it makes money, they’ll blind stab “advertising”.  And they’d be right; that’s a huge source of revenue for Google.  $200B, lots and lots of advertising, scary because they are big but not because we don’t understand them.

Advertising is a huge source of revenue for Facebook as well.  85% vs Google’s 95%.  But how many people in America can tell you that?  Facebook never says “we’re an advertiser” in the same way Google does and consequently, people can let their mind run wild.  Maybe they are selling our data!  Maybe it is the next credit score or background check!  Maybe they are simply going to blackmail everyone!  $50B market cap, smaller than either other country, but entirely black ops.  And entirely scary.

There is abundant psych literature that should remind Facebook that faced by the unknown, people will get scared, hostile, and generate “things that go bump in the night” pretty quickly.  The best thing they could do right now?  A simple infographic and a short statement that says “this is how we make money now, and how we plan to make money, and anytime you have questions, let us know”.  People know who Zuckerberg is, so make him deliver it.  The Facebook fireside chat.