Facebook ( FB ) announced its new Graph Search today in a
special event that was not streamed on the internet, but widely
tweeted. It allows users to search through their friends
likes for recommendations on things like restaurants and dentists.
Does that sound like Yelp to anyone else?
Our Tactical Trader, Kevin Cook and I discussed what this really
means to the stock and where the potential future revenue stream
is. We came up with the idea that this is basically market
research that users perform for free. Then when there is a
real life result, FB will store that and analyze it. After a
few months of use, there should be good recommendations for when a
person searches for a particular item in a particular setting.
The fictional example would be, Kevin Cook and I (we are not
"friends" on Facebook) both like sushi. We also both like
Guinness. If our networks on FB included people from say
Dallas... and they wanted to know a good spot to get some Sushi and
Guinness on their next visit to Chicago... well they would see our
recommendations of places that do that.
Take it to the next step... where you have searched for this,
then either "check in" or better yet, post a photo of your visit.
Now FB has evidence to show the power of ROI from its ads to
advertisers that want to be present when just such a search is
done. It can also say that the photo and the status update
are other secondary ads that come from trusted sources in someone's
Now you see that you are performing market research for Facebook
when you use the Graph Search tool, but don't expect the ads to
come anytime soon... it needs to compile some answers
Do you think you will use this feature? Let us know in the
comments below!FACEBOOK INC-A (FB): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment