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Poll Position for Facebook

By Rick Munarriz – Updated Nov 15, 2016 at 12:04AM

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Facebook is asking all of the right questions.

Yes, it's time for another new feature on Facebook. The campus-friendly social networking site launched Facebook Polls over the weekend. It's not what you think. It's not a platform for university officials to know which bands to book for homecoming or for high schools to settle on a prom theme.

Polls is targeting marketing researchers, allowing them to submit queries and bid on how many data points they require. The higher the bid, the more prominently the poll will appear (and the quicker the results will be attained). Polls can target participants in particular locations, but also aim for specific profiles, keywords, age, or sex.

Polling for profit isn't new. Greenfield Online (NASDAQ:SRVY) and Harris Interactive (NASDAQ:HPOL) are pure plays in this space. What Facebook brings to the table is an ideal audience of young respondents.

The quest for monetization without alienation is an important one, especially for a company like Facebook that seems to be peddling various new revenue streams these days.

A recent Facebook-hosted summit introduced new developer features like serving up Amazon.com (NASDAQ:AMZN) book reviews and comparison travel shopping through SideStep. The flurry of new apps came just weeks after Facebook announced that it was adding online classifieds to its site.

All of this monetization has to leave Yahoo! (NASDAQ:YHOO) steaming after the search engine came so close to buying Facebook last year. The key here is keeping the community happy despite the commercialization efforts.

Flyer beware
Facebook Polls offers a compelling value proposition for data-hungry research marketing specialists. All it takes is a $5 insertion fee to get started, along with the ability to bid as little as a dime for each data point requested.

The new service follows in the thrifty footsteps of Facebook Flyers, Facebook's contextual marketing program. For just $5, a sponsor can have an ad displayed 2,500 times. The spots can include text copy, a link, and even a photograph. Advertisers can target specific campuses, making it an economical way for area businesses as well as fellow coeds to market wares and services locally.

Five bucks for 2,500 impressions? That breaks down to a ridiculously cheap $2 eCPM (or $2 for every thousand impressions). Then again, social networking has a reputation for being a lousy ad platform, prone to ad blindness kicking in as young users blaze through pages.

Flyers may change that, though. It's not just the generic graphic ads you'll find on many of the popular social networking sites. As locally relevant ads, Flyers may leave even the most jaded of Facebook residents tempted by a perfectly targeted spot.

The many faces of Facebook
Cheap polls? Cheap online ads? When you serve up as many pages as Facebook does, you really can nickel-and-dime your way to grand fortunes.

The moves also have to be garden thorns in the sides of its new rivals. Greenfield Online shares took a hit on Friday, but made most of that back yesterday. Paid search giants Yahoo!, Microsoft (NASDAQ:MSFT), and Google (NASDAQ:GOOG) didn't blink at the introduction of Facebook Flyers, but Expedia (NASDAQ:EXPE) did fall on an up day when Facebook Trips was announced.

In concert, the market reaction is that a smarter Facebook can begin to nibble away at the market share of others. For Yahoo!, this is sadly starting to become a tall, tall tale of the one that got away.

Amazon.com and Yahoo! have been Motley Fool Stock Advisor newsletter selections over the years. Microsoft is an Inside Value stock pick. Read all of the original recommendation reports -- now -- with a free 30-day trial subscription to either newsletter.

Longtime Fool contributor Rick Munarriz thinks Microsoft's Steve Ballmer said it all when he said "developers, developers, developers, developers" a few years ago. He does not own shares in any of the companies in this story. Rick is also a member of the Rule Breakers analytical team, seeking out the next great growth stock early in its defiance. The Fool has a disclosure policy.

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