Social Media Tools, Social Media Software

4 Reasons Google Bought Wildfire

Youtility Cover transparent1 e1365439705647 4 Reasons Google Bought Wildfire

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Wildfire, a pioneering social media management software application that specialized in contests and promotions, announced today that it has been bought by Google for a smooth $250 million. (Happy day for Gary Vaynerchuk, who was an angel investor in Wildfire).

 4 Reasons Google Bought WildfireIt was just a matter of time,  as given that Buddy Media, Vitrue, Involver, and Context Optional had already been snapped up, Wildfire was one of few remaining independent players with an enterprise client list. Even though Wildfire had been courted for weeks by multiple suitors, most observers – including me didn’t view Google as a potential acquirer. But it’s brilliant.

4 Reasons Google Bought Wildfire

1. Access to Social Signal
This gives Google an end-run way to get Facebook and Twitter and Pinterest and Linkedin activity signal into the Google search algorithm, since they’ve been unable to keep that stream alive via biz dev deals. You may recall that Facebook never signed a deal with Google to incorporate behind-the-password activity into Google, which is why Facebook activity doesn’t show up in Google much, and also why the Facebook/Microsoft (Bing) alliance was theoretically a counter-balance.

Twitter used to have a “firehose” deal with Google, whereby all tweets were indexed, but that deal expired over a year ago, and led (at least indirectly) to the rollout of Google + so that the big G could have their own source of social signal.

What’s driving this is the fact that “pages” and “links” are no longer the primary way we vote for the accuracy and reliability of online content. Now, we vote with tweets and +1s and likes and shares, and Google doesn’t have a good source for that information (until now), which puts the mothership of search result accuracy (and thus, Google Adwords) at peril. I wrote a whole piece on that called “Why Google Has the Hammer to Make Us Use Plus” if you’re interested.

2. Undercover Brother
Google and Facebook aren’t exactly pals. It’s basically the cold war, with Google as the Soviets; Facebook as the USA; and Twitter as….I guess the British.

What better way to reverse engineer Facebook and take the best of it and improve/incorporate it into Google + than to buy a company (Wildfire) that has under-the-hood access and Facebook favored nation status? Will be VERY interesting to see if Facebook kicks Wildfire out of its Preferred Developer Community, or revokes some measure of access. They might just learn a lesson from Twitter, who recently started cutting off Instagram users from accessing their friends lists on the service.

3. Launch Adwords for Social
Increasingly, social advertising on Facebook and Twitter use mechanisms that are strikingly similar to Google’s Adwords system (which it in turn copied from Yahoo! which bought it from Bill Gross who pioneered the concept at GoTo in the way back days).

Google has got to be thinking, “We already have the platform, the advertisers, and the track record. Why let an entire, parallel industry spring up?”

Wildfire isn’t known for their social advertising prowess, but could Google use this acquisition as a springboard to create a social advertising platform without rival, a one-stop source for Google, YouTube, Twitter, and Facebook ads?

4. Kill the Category
Google may want to kill the social media management software business in the nest, so Salesforce, Oracle and the other acquirers of the big players don’t get too much of a foothold in the “platform of the future” and social CRM. If they make Wildfire free, and also make it the best or only way to do Google + well for companies, what does that do to Buddy, Vitrue, Syncapse, etc?

There is most definitely a precedent for this, as Google bought web analytics company Urchin (which was approximately third in the market, the way Wildfire is now). Google then added a bunch of features, changed the name to Google Analytics, dropped the price to ZERO and proceeded to all but kill Webtrends, Omniture and every other expensive software package companies were using for analytics. Interestingly, Webtrends for big sites cost back then about what Vitrue and Buddy cost today.

Google doesn’t need to make money on Wildfire. But it sure as hell can prevent Salesforce and Oracle from making money on Buddy, Involver, and the rest.

 

 

  • http://www.ackermannpr.com/ shanerhyne

    Good thoughts here. As you mentioned from the Urchin experience, #4 is the key point to watch here moving forward.I’ll be interested to see how Facebook responds to Wildfire’s current preferred developer status.

  • JanetJohnson

    Great post!  There always seems to be a war out there between these platforms.

    • http://www.convinceandconvert.com JayBaer

      JanetJohnson I’d say the war is just starting. 

  • sierratierra

    Perhaps now Google will ease up on brand promotions/sweepstakes on G+ pages? 

  • BilalJaffery

    Great insight. There is definitely a huge play here to gain Facebook insights. In addition, it will help accelerate the ROI dillemma that is often associated with social. As they say, future of social is advertising for now and then it might just be premium access to the platform. 

    • http://www.convinceandconvert.com JayBaer

      BilalJaffery I would say if they can tie social media management activities into Google Analytics, they could take yet another step in tying together the ROI loop. Exciting!

  • http://bit.ly/GPlusJpeters1221 jpeters1221

    Nice post. I especially like your comment that Google could make Wildfire free. That would be very very interesting, especially coupled with Google Analytics.I’m extremely curious to see how Facebook reacts to this though. I can’t imagine they’re too happy with Google having all this backend Facebook access/information. They very well could shut off access.

    • http://www.convinceandconvert.com JayBaer

      jpeters1221 I think that’s the key pivot point, whether Facebook now kills access for Wildfire. 

      • BrettRad

        JayBaer I don’t imagine them doing that.  Facebook had a vested interest in Wildfire through FbFund.  I imagine that they had a board seat in Wildfire as well.  I also imagine that Google made sure that some contract agreement between Facebook and Wildfire would stay intact for a specific time period.

  • MarkoZM

    Jay, provocative post, thanks.shanerhyne
    I
    tend to agree with you. There’s nothing stopping Facebook from removing
    preferred developer and Insights and Ads api access to
    Wildfire/Google. The point about Twitter and Instagram isn’t apples to
    apples. Brands give wildfire $$ to help execute marketing, they have
    many other options and not nearly the social strength of Instagram
    users. Without deep connections into Facebook the current Wildfire
    business is done. Big brands won’t go to Google to develop
    Facebook and Twitter marketing programs. Will anyone go to Google to
    develop Google+ programs?  Maybe.Also, how would this kill
    the SMMS
    category, I don’t understand the logic. There are more and more
    networks with more and more critical mass. Customer behavior is not
    limited by Google’s wishes, ask Pinterest. Marketers need help across
    networks,
    across their own brands and across geographic regions. How does Google
    buying Wildfire have any impact on that?Lastly, if they
    “Urchinize” Wildfire and make a free self-service app platform for
    social media marketing, they’ll need access to the Facebook APIs (not
    likely). Brand just aren’t spending significantly $$ anywhere else
    (they’re not even spending significant $$ on Facebook yet). Wildfire and
    many others have tried this and it’s not a big business. Enterprise
    social media management is and makes a lot of sense in the portfolio of
    Salesforce, Oracle and Adobe for example.Believe me, I’d never count Google out and there must be some good reasons for the acquisition, I just can’t think of any. : )Thanks again for compelling me to join the conversation.Marko Z Muellner | Sr. Director of Marketing | ShopIgniter.com | @markozm

  • RizzoMB

    Great post, I think the most immediate impact will be on search results.  Google needs to get more social and needs the “votes” from social to help influence organic results. I’d be very surprised if they didn’t make it free by Christmas.Not sure about the advertising angle, there still seems be some challenges there.

    • http://www.convinceandconvert.com JayBaer

      RizzoMB True, but as Jeff Widman from http://pagelever.com was telling me last night, the number of pages Wildfire has access to is limited, so their immediate role in providing social signal to Google may be muted. 

  • http://www.pammarketingnut.com/ PamMktgNut

    Interesting perspective.  I hadn’t thought about making Wildfire free. Yes, that would make incredible sense to delete an entire category. The advertising platform could also obviously be an interesting play. My guess is the core reason is they want the data and to delete the category. It’s a competitive play and heck if they can gain a leg up in some key areas, whey not, right? Great post! Thanks :) 

    • http://www.convinceandconvert.com JayBaer

      PamMktgNut It may not happen, of course, but they should make it work in web analytics!

  • JoeCincotta

    One thing you forgot to mention is that Wildfire has a huge social analytics platform (beyond contests etc) that could easily integrate with Google Analytics. The ad-words-in-social cannot ever fly due to the Facebook developer legals – and my guess is; they will *never* get approved ad-supplier status from Facebook! :) As far as social contest and promos go, I think they will eventually drop all the tools other than the G+ features, making promotions and compos a native feature in G+ …that would kick some brands in to gear and have them with free native tools to adopt G+ presence whilst Facebook still costs $ to get any kind of similar features.Just my thoughts on this…

    • http://www.convinceandconvert.com JayBaer

      JoeCincotta Absolutely Joe. Great comment. I don’t know that even free contests/admin makes brands use G+ instead of Facebook, given the huge differences in audience size. But if those audiences were a little closer together….hmmm.It’s funny to me that in social, Google is Bing. 

  • pavelnovel

    With Google using social actions to help it index data, do we inadvertently become real-life human Google bots? As far as Google making social media management free, that definitely is a great way for Google to gain a strong foothold over other social networks – especially with added features and integrated with Google analytics. If they offer a free platform on Google Plus, many businesses will be drawn to the network. In turn, over time they will begin offering customers incentives to engage on G+, which works greatly in Google’s favor. Interesting to see what happens next. 

    • http://www.pammarketingnut.com/ PamMktgNut

      pavelnovel Good points. However, I still think the core gap Google has is they do not have the “people”. Even if they were able to win some “biz’s” because of a free platform, they still have the same problem… they still lose to Facebook’s almost 1 billion users. 

  • http://blog.forthmetrics.com/ HughAnderson

    Wow, this is really thought-provoking stuff. But surely the big challenge is that Facebook will almost definitely have a termination clause that prevents Google from accessing their API. And if that is the case, does it not blow a big hole in both 1 and 2 and also seriously compromise 4 as only independent third party solutions can get the global access required?

    • http://www.pammarketingnut.com/ PamMktgNut

      HughAnderson Good point about the clause and API access. Definitely throws a loop in the ad platform. However, will Facebook really turn down the revenue? 

      • BrettRad

        PamMktgNut Exactly Pam.  Oh and did you know that Facebook has an actual vested interest in WildfireApp.  So Facebook is actually getting a return on their investment from Google. 

  • http://fusionmarketingpartners.com Fusion Marketing

    Great points. I’m subscribed to Wildfire’s twitter feed and they act
    endlessly excited about this deal. Who’s to say how much of that is
    “irrational exuberance” or simply trying to appease their new owners.
    I’m leaning towards the “kill the category” attitude for Google, myself.
    They’re continually expanding into new areas and then deciding all the
    competition is a major inconvenience.

    • http://www.pammarketingnut.com/ PamMktgNut

      Fusion Marketing I think I’d be pretty happy if selling for $250 million too! ;) Put on a happy face for a bit, send a few nice notes & then head to the private island beach resort for a few years! 

  • https://www.facebook.com/CMontgomeryAdams carol montgomery adams

    Jay, great post! I especially like your take on the enterprise social platforms like Salesforce and Oracle. This is a great space for Google to play. I also hope that with Wildfire they’ll figure out a way to out-Facebook, Facebook on their horribly contorted push of Promoted Posts. I’ll look forward to seeing how they integrate Wildfire as to Joe’s comment also as I struggled at my last company with social media analytics integration with GA!

    • http://www.convinceandconvert.com JayBaer

      carol montgomery adams I don’t mind how Promoted Posts work, actually. I do mind that they artificially restrict the % of MY OWN FANS that will see my content so that I have to buy promoted posts to achieve any sort of decent awareness. That irks me. The mechanics of it don’t. 

      • https://www.facebook.com/CMontgomeryAdams carol montgomery adams

        JayBaer yes, you are right!  that is the part that irks me too..I would like to see FB find a way to  reward keywords in posts and link EdgeRank to keywords..so that my FB posts also get SEO juice AND get to people in the NewsFeed that have that keyword as “interest”…of course that would mean a tighter partnership with Google wouldn’t it?  It just seems that the use of SEO should be as important on FB as it is in Google-world, considering the amount of content that is being pushed, or am I off on this thinking?

  • http://dannybrown.me/ Danny Brown

    The interesting stuff will be seeing what Google does with Wildfire. Somehow I can’t see Twitter, Facebook, etc, being overtly open about allowing Google access to their tools again – so it may be that Wildfire loses its use in that area, and gives Google a more robust social promotion platform instead (sales via Wallet, analytics on campaigns, etc.).Fun times!

    • http://www.convinceandconvert.com JayBaer

      Danny Brown Exactly. What if – amazingly – Google + becomes by far the easiest/best/cheapest place for brands to interact with their fans in social media? It’s perhaps unlikely, but it is possible. 

  • thomasbigum

    Has anyone noticed, that sweepstakes apps and other traditional 2011-ish Facebook-apps does not have a mere 50% of the impact they did prior to Timeline?This acquiring frenzy is completely madness to my belief – being a consultant that tracks records, seeing FB-apps not working the same anymore.These companies are insanely lucky to be bought before investors have gotten hold of these mere facts..Sweepstakes and other contests on Facebook almost only attracts prize-hunters now a days. That leads to empty calories in the facebook page, which will end up as rocks tied to a swimming companys legs later same year…. A lot of consultants don’t play fair game, and sell them anyway. Companys sure as hell does not know these facts – so investors/buyers dont either.I have strong belief in social CRM, but the app-companies such as wildfire and involver were/are doomed due to changes in facebook behaviour.

    • http://www.convinceandconvert.com JayBaer

      thomasbigum True, the emphasis on apps is way down. However, Wildfire (and even more so Buddy, Vitrue, Involver) do a lot more than just apps. Lots of workflow, editorial calendaring, deep metrics, etc. The reduced emphasis on tabs doesn’t ruin their valuation, but does make you wonder if it’s all a bit overheated. 

      • thomasbigum

        JayBaer okay true. I certainly hope that people with a $250 mio wallet can see more than me :-) However, the deep metrics of prize hunters is compareable with buying permissions from companies harvesting them thru 00-ish surveys. True fact. A huge part of the interesting segment – ‘the connected consumer’ as Solis calls them – has simply stopped touching contest and promos here in Denmark.I know that for a fact, because my market as a consultant is so relatively small (Danish population of 5 mio), that i can easily compare entries across my clients and find the same facebookusers hunting prizes.In addition. Name an USP at hootsuite with its calendaring and crispsocial with their advanced sentiment analysis that isn’t dimminished everytime Facebook makes an update these days. One day we woke up, and admins could time their posts within facebook. With the iPhone app Facebook Page Manager, Facebook provides an inbuild sentiment (negative/positive) metric… Next up is workflow solution for big corporations.Facebook themselves are undoubtly on that case. Latest with the ‘switch region’ that is being beta-tested. Multiple timelines for corporations have several outlets and/or being a worldwide brand.(See Lancome as an example.. ‘switch region/country’ via menu just below cover photo).. not fun being 4 guys in a garage and three years spent on third party solution to help companies drive facebook promos and make management easier – UNLESS the giants are having a blindfolded buying frenzy in those exact garages. Maybe to keep each other somewhat stalemate in the media headlines.The famous Danish writer H.C. Andersen wrote The Emperor’s new clothes, and I feel like the boy in the crowd shouting ‘…but he’s not wearing anything?’———————-Thx for blog, book and podcast btw. You’re a big inspiration to my work :-)

  • wildfireapp

    @tim_baran Hey, you can still love us! We still love you.

    • tim_baran

      @wildfireapp thx :-) congrats on the deal. I get that. I just can’t believe that it won’t impact your great Facebook campaign services

  • dbovenschulte

    @devrin Going to be a fun Thanksgiving for the Zuckerbergs with Google now in the family http://t.co/1oAfFi18 @jaybaer @Twabbi

    • devrin

      @dbovenschulte hysterical… Someone should do a cartoon of Google, Facebook at the Thanksgiving table… @jaybaer @Twabbi

  • estheryuste

    @franciscohm de nada :-)

  • DniseSonnenberg

    @suburbanmama Hi Marcy good to hear from you.

  • helloitskelly

    @imagineframing I miss the framing quotes.

  • jaybaer

    @bkzanghi Thanks much.

  • jaybaer

    @airgreenberg Probably so, but there’s a precedent.

  • LisaaLandry

    @toniRmcmahon This is too juicy. Thanks for following me!

  • PipCarltonBarnes

    Brilliant post thanks!

  • Kyle Elliott

    I like how you said Google might want to Kill the Category by making it free. Now, a year later, they’ve phased out their cheap small business option, and are asking $2,500 a month for businesses to run promotions through them. I understand that Google has plenty of money to throw around to make waves with Facebook, but I wish it wasn’t at the cost of small businesses trying to expand their social media prowess

  • Susan Miller

    how can i sign up to have a wildfire google account?

    • http://www.convinceandconvert.com/ jaybaer

      Alas wildfire has been closed by Google.