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The importance of logged-in users

July 20, 2015 - strategy
The importance of logged-in users

In a recent article The Information argued that most of Yahoo users are not logged in and, therefore, it is hard to demonstrate value selling ads. By way of definition, logged in users have a profile in the platform, typically with an email address or username. In the case of Facebook they know a lot about you including your birthday, who your friends are, an what you like. In cases such as Github they have very little personal information but they know about your repositories. Newspapers such NY Times know your email address, reading activity, and comments (they will know more if you link it with your Facebook account). Slack knows your username, phone, and can track your posts. Logged in users are attracted not only to standard platform features but also for the additional benefit of exclusive content, secure access, and functions only available to logged in users.

On the other hand, logged out users are consumers of content available openly on the web and whose activity is not easily mapped to a single individual. Yahoo offers both logged in (Yahoo Mail) and logged out (Tumblr) experiences. Similarly Twitter offers both logged in (content filtered by follows) and logged out experiences (content based on hashtags). I argued last year that Yahoo should focus on mobile and video as growth opportunities. The key would be how to develop those businesses with logged in users.

Arguably Facebook is one of the greatest content platforms without spending any money on developing content.

Logged in users not only can be tracked within the platform but also across channels. Since Facebook, Twitter, Google Plus and others adopted the Oauth standard to enable login outside of their properties it has enabled tracking of user activity “beyond borders”. The omnichannel customer journey can now be tracked across internet properties creating value across the buying path. Facebook can learn about your activity outside of Facebook and retailers learn more about their customers and behaviors. Consumers benefit from better targeting to the risk of less privacy. One of the greatest advantages from Facebook is the combination of both great content (posts, news, videos, Instagram) with high logged in user engagement. Arguably Facebook is one of the greatest content platforms without spending any money on developing content. On the other hand, Yahoo invests on creating content (Yahoo News, Music, and Screen) without being able to fully capture omnichannel user behavior since not all users are logged in (some are but not clear on the % split). Yahoo’s logged in users come from Yahoo Mail which makes it vulnerable to competition from other email providers such as Gmail. Youtube straddles both where they offer great video content with both logged in (channels, subscriptions, playlists) and logged out experience. Twitter offers non-curated content for millions of logged in users (and also logged out users). Last, blogs offer a logged out experience with specialized non-mainstream content. The following two-by-two matrix illustrates my point.

logged-in-matrix

Ad selling is about the ability to prove that your platform is better capable of provisioning the right ads to the right consumers. The key question is how accurate you can achieve that without logged in users. Search queries may help but they lack the additional demographics information from your profile and they don’t come with a friend recommendation.

Key questions to consider

 

 

It is important to note that the omnichannel concept has truly evolved to include brick-and-mortar stores, retail Internet properties, non-retail Internet properties such as Twitter, Facebook, and Youtube, mobile apps, micro-sites, and others.

Interesting cases

 

 

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Ad selling is about the ability to prove that your platform is better capable of provisioning the right ads to the right consumers. The key question is how accurate you can achieve that without logged in users. Search queries may help but they lack the additional demographics information from your profile and they don’t come with a friend recommendation.