The ROI on social media is at retail. By Catherine Boera. (more)

"Facebook is evolving through Facebook Connect into much more than a website," says Ethan Beard, as reported by Jenna Wortham in the New York Times (3/13/10). "It's also a technology and a service to provide social plumbing and creating a social layer the whole web can leverage," says Ethan, who is director of the Facebook developer network. Facebook Connect, which was introduced in December of 2008, "lets users log into new sites using their Facebook credentials." It also provides other social-networking sites with a way to "recruit a healthy crowd of users in a hurry, and help the users find their friends on those sites."

For example, Blippy has used Facebook Connect to build its network, which "allows members to give friends a glimpse into their spending habits by showing purchases made through iTunes and Netflix and on major credit cards." Co-founder Philip Kaplan explains: "There hasn't been a big forum for talking about what you buy online ... The concept came from the idea that every time you use your credit card to pay for something, there is potentially an interesting conversation to be had with friends and online followers." Since its public launch in January, Blippy's members "have shared details of more than $15 million in purchases with their friends."

Facebook Connect made that kind of growth possible in part by making "it easy for people to send messages back to Facebook," which helps spread the word among friends back on Facebook. Charlene Li of the Altimeter Group says Facebook Connect also helps both Facebook and the "connected" sites better target advertising. The value to users appears to be equally promising. As Amanda Lenhart of the Pew Internet and American Life Project points out, "In a way, these services are a response to the ever-increasing amount of information on the Web ... We need our network and like-minded people to connect us to the information we need the most."

"It would be silly to count us out," says Jason Hirschhorn, co-president of MySpace, in a USA Today piece by Jon Swartz (3/10/10). "There is a pulse of pop culture on MySpace," he continues. "It is the place where 100 million people congregate, and hundreds of thousands sign up every day." And profits? MySpace has profits -- it is "expected to haul in more than $350 million in revenue this year -- mostly from ads." Yet, the perception that MySpace is in decline is actually more than just a perception.

It's not only that Facebook has eclipsed MySpace in users -- Facebook "boasts 400 million members, about four times as many as MySpace." Ad spending on MySpace is also projected to "fall 21 percent this year." However, Jason Hirschhorn and co-president Mike Jones have a plan to clean up the clutter and reinvent MySpace as "the online venue to find new friends, movie trailers, little-known bands and social games." To some degree this doesn't require reinvention: "More than 13 million bands, from Pearl Jam to garage bands, find it a vibrant tool to communicate with fans."

MySpace hopes to capitalize on this, and Tim Westergren, founder of Pandora, thinks they've got a shot: "They were the first mass destination and home for DIY artists. Bands remember that," he says. Mike Jones also notes: "Thirty percent of our users play games ... We think it should be 50 percent." Interestingly, MySpace is using Twitter and Facebook as channels to promote its newfound niche. "When we think about Twitter and Facebook," says Jason, "we don't think about competition as much as we think about partnership, distribution and synchronization." He adds: "We will always be culturally relevant."

The notion that kids today are somehow different because they grew up with digital tools may be overblown, reports the Economist (3/6/10). Sue Bennett of the University of Wollongong, writing in the British Journal of Education, argues that there could be "as much variation within the digital native generation as between the generations." She says such generational generalizations "fail to recognize cognitive differences in young people of different ages, and variations within age groups."

The point is that digital natives "do not really have different kinds of brains that require new approaches to school and work." Michael Wesch, a new-media pioneer and cultural anthropology prof at Kansas State agrees that many of his students "have only a superficial familiarity with ... digital tools."His view is diametrically opposed to professors who suggest moving "classroom discussions to Facebook," for instance, or management gurus who want employers to shift from "command-and-control" cultures to more collaborative environments.

It may also upend the idea that "digital natives will grow up to be more responsible citizens" and use their digital prowess "to campaign on social issues and exercise closer scrutiny over their government." Again, "there may simply be too much economic, geographic, and demographic disparity to make meaningful generalizations ... There is also a feeling of superficiality about much online youth activism." Joining an activist Facebook group is one thing, but a Pew Research Center study "found that internet users aged 18-24 were the least likely of all age groups to email a public official or make an online political donation."

A couple of weeks ago, I took a great leap of faith and ordered a sweater online. It was this really nice sweater, from 66º North, with fancy diamond stitching around the neck. To be clear, the sweater wasn’t for me; it was a birthday present for my wife. When it arrived, the first surprise was that it was sent all the way from Iceland. The second surprise was that it didn’t have the fancy diamond stitching around the neck. It did have some stitching on the shoulder, but it just wasn’t what was pictured on the website (image).

The third surprise was that when I called customer service, a woman answered the phone in Icelandic. This was a refreshing switch from Bangalore, but not at all what I expected. She converted to English in a heartbeat, fortunately. I’m thinking, man, this isn’t going to be good. But the nice lady on the phone slowly unraveled the mystery: They had sent the men’s version of the sweater by mistake. It had been shipped from Iceland because it was out of stock in America.

She then suggested they ship a size medium instead of a small, because Americans are so fat. No, actually what she said was, they run small. Anyway, she had the old sweater picked up so I wouldn’t have to make a trip to UPS (as much as I like going there). When the new sweater arrived, it was perfect. To be honest, 66º North isn’t the most organized organization in the world. But the bumbling had its charm, its warmth. It’s a reminder that the human touch, with all its flaws, is a powerful thing indeed. That’s just as true at retail as it is in real life.

Everything that's old is new again for Sears, as it searches "for fresh ways to sell Kenmore appliances and Craftsman tools in an age of iPhone apps and Twitter," report Miguel Bustillo and Geoffrey Fowler in the Wall Street Journal (1/18/10). Back in the day, shoppers would place orders using the grand old Sears catalog, and then pick up their orders at a Sears store. Now, the hope is, they'll order via site called MyGofer and, once again, retrieve their goods in-store -- this time by swiping their credit cards at a kiosk, and then waiting "while workers resembling hamburger-stand carhops bring out the goods."

So far, MyGofer is only a test, with a single pickup center in Joliet, Illinios, at a converted Kmart store. But it seems to be working: "We have taken the good ideas out there and evolved them," says Imran Jooma, svp of e-commerce for Sears. This even includes bringing back an old-fashioned "layaway" program, which helped Sears "boost revenues" over the holidays. And while Sears continues to struggle overall, the retailer's "executives say that the online business has increased by double digits in the past two years. It notched an estimated $2.7 billion in 2008 ... more than Walmart's $1.7 billion."

It's all part of a plan by Sears chairman Edward S. Lampert, who bought and combined Sears and Kmart five years ago, only to find "its same-store sales have dropped off every year since the merger." Rather than "pour money into Sears' crumbling stores ... he is far more bullish on web ventures, with their small capital requirements and vast potential audiences." Other initiatives include an "iPhone app, called Sears Personal Shopper," that lets you take pictures of stuff you want "and dispatch images to workers who can track them down for sale." In addition, a pair of social-networking sites, MySears.com and MyKmart.com, "now have 400,000 registered users."

"There are many other things to do in life than fill a shopping basket," says Martin Toulemonde, co-founder of Chronodrive.com, in a Wall Street Journal piece by Christina Passariello (1/14/10). In partnership with another retail executive, Ludovic Duprez, Martin started Chronodrive, in France, back in 2002. They reckoned that if it was too expensive to order groceries online and then have them delivered, they'd just take a page from McDonald's and let people do their own pick-up via drive-through. Oh-la-la. The idea seems to be taking off.

The first Chronodrive opened "on the outskirts of Lille, in northern France, in 2004. They chose a suburban neighborhood near main thoroughfares with a high number of middle-class families with cars -- the ideal consumer who does a lot of grocery shopping but is short on time." They just opened their 16th store, in Toulouse, and plan "to expand to 32 outlets this year." In addition to ordering online, customers can also "use a terminal outside the store to make quick orders for any of the 500 products it makes immediately available."

Shoppers can specify a pickup time within two hours of an online order, Chronodrive guarantees delivery to your car within five minutes of your arrival, and all orders are held for 24 hours in case you're late. Workers make sure you like the produce, and the bread is fresh from local bakeries. Chronodrive says it has 130,000 customers who order "an average of 40 items per shopping trip." Other retailers, including Carrefour, are developing similar concepts around France. Rumor has it that Walmart is also eyeing the concept, although so far the company hasn't commented about that.

"Technology criticism shouldn't be left to the Luddites," writes Jaron Lanier in You Are Not a Gadget, as reviewed by Glenn Reynolds in the Wall Street Journal (1/13/10). That's quite a statement, especially from Jaron, who "was one of the pioneers of immersive virtual worlds and helped popularize the term, 'virtual reality.'" But now Jaron is concerned that the likes of Google and Facebook -- "the lords of the clouds" as he calls them -- are "creating online environments in which true individuality is curtailed in favor of the extrication of marketing data and other intelligence."

He's also worried that this de-emphasis of individuality online feeds a certain rancor in internet culture, because "when you ask people not to be people, they revert to bad moblike behavior." Further, says Jaron, the whole notion of "information wants to be free," devalues creativity. He writes: "Pop culture has entered into nostalgic malaise. Online culture is dominated by trivial mashups of the culture that existed before the onset of mashups." Net is, the return on remixing the old culture might exceed the return on creating anything new.

Predictably, Jaron's manifesto has resulted in backlash online -- apparently mostly from people who haven't actually read his book, instead simply reading an online summary of it. This, of course, underscores Jaron's concerns "about the demise of considered thought and the rising tyranny of first-impression reactions to complex ideas." But Glenn Reynolds takes issue with Jaron on one point, at least -- Glenn argues that the "social web" does in fact enable people to "collaborate, organize and socialize as never before," and that sites like Facebook and Twitter enable "tens of millions of people ... to express themselves in ways that were unimaginable even a decade ago."

David Carr says Twitter gives him "a sense of the day's news and how people are reacting to it in the time that it takes to wait for coffee at Starbucks." Writing in the New York Times (1/3/10), David says he didn't feel so warmly toward Twitter until last March, while attending the SXSW conference, "a conclave ... where technology, media and music are mashed up and re-imagined." He says he found the name, Twitter, itself so trite that it "impugns itself, promising something slight and inconsequential ... the verb, 'to tweet' is even more embarrassing," he writes.

But at the conference David says he noticed that "the primary news platform was Twitter, with real-time annotation of the panels on stage and critical updates about what was happening elsewhere at a very hectic convention." And so, he says, he "succumbed, partly out of professional necessity." He says he's also now convinced that Twitter "is here to stay." The key, he says, is to curate carefully "the people you follow." When you do that, "Twitter becomes an always-on data stream from really bright people in their respective fields, whose tweets are often full of links to incredibly vital, timely information." In other words, its value is more in following than being followed.

He continues: "The service has obvious utility for a journalist, but no matter what business you are in, imagine knowing what the thought leaders in your industry were reading and considering. And beyond following specific individuals, Twitter hash tags allow you to go deep into interests and obsession: #rollerderby, #physics, #puppets and #Avatar, to name just a few of many thousands." David also cites this quote from Clay Shirkey, author of Here Comes Everybody: "It will be hard to wait out Twitter because it is lightweight, endlessly useful and gets better as more people use it. Brands are using it, institutions are using it, and it is becoming a place where a lot of important conversations are being held."

A little-known company called Next Jump could represent the future of e-commerce and give Amazon a run for its money, reports Steve Lohr in the New York Times (12/6/09). Next Jump has its unlikely roots in a business Charlie Kim started while a student at Tufts University, in which he inserted local merchant coupons in student guidebooks. After graduation, this evolved into "corporate perk programs that offered employees discounts on merchandise."

Eventually, Charlie took his enterprise online and today "60 percent of the Fortune 500 companies use Next Jump's technology for their employee discount programs." It also handles consumer rewards programs for various companies to a point where "more than 100 million Americans have access to Next Jump's e-commerce marketplace, and 10 million a year are customers." What that gives Next Jump is all kinds of really valuable data, which the company has combined with "credit-card transaction data from American Express and MasterCard."

This provides insights into "what a person would be likely to buy, and at what price," which it further combines with retailer data that specifies "the characteristics of customers -- age, location, income, for example." The key, of course, is Next Jump's software, which "tailors offerings to small segments of potential customers, down to individuals." Next Jump claims a 60 percent click-through rate and says that one in every 11 people who sees one of its ads buys something. Importantly, Next Jump is not a retailer, but "merely a technology engine for sales," making it potentially a more attractive partner to retailers than Amazon.