ECOMMERCE DEVELOPER: Facebook's Open Graph: Could It Be the End of the Walled Garden?

- May 13, 2010

Article Reprint From: http://developer.practicalecommerce.com/articles/1903-Facebook-s-Open-Graph-Could-It-Be-the-End-of-the-Walled-Garden-

Facebook’s recent announcement of Open Graph, a new capability allowing Facebook’s marketing partners to share user preferences and behavioral information, opens many questions about web privacy and consumer advocacy. But to me, Facebook’s move is just another step toward encouraging retailers to adopt a more outward facing view of their brands.



In the web’s early days, many site managers adopted a "walled garden" approach to online strategy.



A "walled garden" is a website that attempts to lure in visitors and keep them from exiting by providing all the content and functionality they could possibly need. In practice, this concept led to web page designs burdened with hundreds of internal links to tools, articles, and other content pieces, each a potential distraction from the item the user is currently focused on.



In many ways, the walled garden approach was always flawed, as the web is by definition an open and convenient platform for information access. And as search engines like Google and Bing become more powerful, customers are increasingly empowered to locate the data they need to make decisions, regardless of which site that data happens to be on.



Web 2.0 and Social Media



The Web 2.0 revolution, with its focus on customers’ ability to pull information as they see fit, rather than having it forcibly pushed to them, encouraged retailers to rethink the walled garden approach to digital marketing. Many brands now have an active voice on social networking sites such as Facebook and Twitter. But however progressive these efforts appear, they are still essentially an extension of more traditional forms of digital marketing such as banners ads and email campaigns, in that they are designed to eventually lure visitors back to the retailers’ web sites. And there, the walled garden is still very much alive.



Take a look and you’ll find very few external links on retail ecommerce web sites. In fact, a key challenge for many retailers in ensuring their product pages have enough content that visitors won’t feel the need to leave looking for more information. That’s part of the reason why customer ratings and reviews have become so common—they offer a retailer the opportunity to provide rich product information from a relatively unbiased source, reducing the need for visitors to seek a second opinion elsewhere.



Walled Garden Metrics



Retailers continue to judge their success based on walled garden metrics. In-session conversion rate remains the most commonly reviewed and discussed metric, even within multi-channel retailers whose websites play a key role in educating customers prior to making a purchase in-store. In-session conversion rate measures the percentage of visitors who make a purchase within the same visit, and can be as low as one percent.



New Ways to Measure Success



The challenge facing retail website managers is to adapt to the increasingly open online environment, and find ways to measure their success while doing so.



An early example of breaking down the walled garden was Newegg, which several years ago began linking all of its product pages to manufacturers’ websites. Many of these manufacturers offered the same product for sale on their own sites, meaning Newegg was opening itself up to the potential of lost revenue if customers chose to purchase directly from the manufacturer. Newegg, however, felt that an informed customer is its best customer. So rather than trying to “trap” their visitors within an illusory walled garden, they made it easier for customers to find relevant information, whether on the site or otherwise.



The Open Graph

Facebook’s Open Graph will be another test of the walled garden strategy.



Levis' integration of Open Graph is an early demonstration of how social networking sites may help break down the barriers retailers have built up during the last decade. Instead of focusing on trapping visitors within their sites until they make a purchase, retailers should ask themselves how they could best serve their customers’ needs. Integrating with social networking sites is one tactic, linking to external sources of information is another. At the same time, retailers should begin prioritizing alternate success metrics, such as cross-session conversion rate, cross-channel customer value, and per customer profitability, that provide a broader view of customer interactions with the brand.



In a perfectly transparent online landscape, retailers who best engage and empower their customers will likely enjoy a considerable competitive advantage over those who try to force their customers to remain within their garden walls.



Integrating features such as Facebook Open Graph can open opportunities for developers to work with their retail partners in breaking those walls down.



About the author: Kevin Moffitt is Vice President of Strategy and Customer Experience for CrossView.