Inside Facebook

Facebook has updated its mobile site m.facebook.com with the hybrid news feed launched for the web version of the site that it had launched on Monday. Since the Facebook for iPhone and Android apps both pull the news feed from the mobile site, the 93 million daily active users of the two apps now also see a single feed with Top Stories followed by Recent Stories. Users of these mobile interfaces no longer have the option to view separate Top News and Most Recent feeds.

For most users, there’s now no escaping the sweeping changes Facebook implemented this week. While those who never realized they could switch between relevancy-sorted and reverse-chronological feeds will now be more likely to see fresh, compelling updates, others who grew accustomed to bouncing between the feeds may be displeased that they need to alter their behavior.

At the top of their feed, mobile users will see now Top Stories, followed by Recent Stories, and finally “From Earlier Today” which includes older Top Stories and Recent Stories. Since the two popular smart phones apps pull the news feed from the mobile site, Facebook was able to make just a single code changes to update both the iPhone and Android app interfaces without requiring users to download a software update.

Facebook uses a variety of signals to determine what updates become Top Stories, denoted with a blue triangle in the top left corner. On the web version users can mark and unmark updates as Top Stories. Mobile users don’t have this option, and must accept the decisions of the EdgeRank news feed sorting algorithm.

However, users can filter the news feed according to type of update, such as Status Updates, Events, or Photos. Facebook has also made its new Smart Lists available as mobile news feed filters in addition to all of a user’s manually built Friend Lists. These give users some options if they’re not content with what they’re seeing in the new default “All Stories” feed.

The hybrid news feed feels a bit more natural on mobile, where a quick, lightweight experience works better than having a ton of options like on the web. While many users are still complaining about the web interface changes and the introduction of the Ticker, we believe some of the announcements made later today at the f8 conference will illuminate the importance of the recent redesign.

Users shouldn’t expect the mobile changes to stop, as we hear Facebook may release a major redesign of its popular smart phone apps. It might also launch the standalone mobile photos app that leaked in June. We’ll be providing deep analysis of what the announcements at f8 mean to users and developers, so check back later today.

Users part of the initial roll out of the news feed redesign announced yesterday are also receiving several other unannounced changes to Facebook’s interface. These include an expansion of the character limit on posts from 500 to 5,000, a rollout of the floating navigation bar we saw tested last week, the ability to edit bookmarks in the home page’s left navigation bar, and a more convenient way to leave birthday greetings. Over the last few days Facebook has also buried the poke button within a drop down menu, and removed the ability to accompany a friend request with a message.

By launching these interface alterations now rather than amongst other sweeping updates at the f8 developer conference on Thursday, Facebook may be able to reduce the shock to users. The timing will also help the site keep attention focused on Platform-related updates that directly impact developers. Unfortunately, the combination of so many changes with the prompts necessary to explain them gives the home page a foreign look that may turn off some users.

Any update to the core features of the site produces some backlash, and changing the news feed means changing a lot of people’s ingrained behaviors. Still, the merger of the Top News and Most Recent feeds and the addition of the Ticker may be inspiring more complaints than Facebook has seen since it abruptly changed user privacy controls in 2009.  Our commenters were highly critical of the Ticker’s design as Facebook tested it over the last few months, and AllFacebook reports that large volumes of complaints are now being publicly published by the site’s users.

Facebook’s strategy over the years has been to gradually test and roll out changes, but between the last week and f8 the service will have changed dramatically in a short period of time. Newer users already feeling overwhelmed with the site, such as older age groups, may give up if too many features suddenly change. Facebook might consider delaying any changes not directly tied into the major Platform announcements until users adjust.

Today, Facebook shows no signs of slowing down, though, as it has begun rollout of the following additional changes alongside the news feed redesign:

5,000 Character Limit on Posts

Previously, the maximum length for Facebook posts was 500 characters, which was appropriate for most social updates. However, it may have been limiting for those trying to use Facebook as a lightweight blogging platform — something encouraged by the Subscribe asymmetrical follow feature launched last week.

Now Facebook posts can be as long as 5,000 characters and comments have a maximum of 8,000 characters. This will allow deep discussions about complicated topics to take place within the site. If users reach the character limit while posting, Facebook allows them to instantly convert the update into a Note. In the news feed, long posts show just their first 1,200 or so characters.

The change takes another talking point away from Google+, which places no character limit on posts. Long posts could make the news feed look too dense or even boring, especially compared to Twitter’s stream of 140 character updates. Facebook may need to reduce the number of characters shown above the fold in news feed posts to keep the news feed easy to digest.

Floating Navigation Bar

The top navigation bar now floats and remains visible as users scroll down pages, as we saw tested last week. This gives users access to their notifications, Messages, requests, account and privacy settings, search bar, and a home page link at all times. We believe this will increase the average Facebook session time by making it easier for users to return to the news feed or check new notifications when they reach the bottom of a page and might have otherwise left the site.

Facebook has also slightly altered the appearance of the bar, replacing the “Profile” link with a user’s profile picture, and the “Account” link with a small arrow that opens the settings drop-down. This gives the top navigation bar a more minimalist design.

Edit Home Page Bookmarks

Hovering over a bookmark in the home page’s left sidebar now reveals a pencil icon that lets users edit that bookmark or the settings for the thing it represents. Here are the options users receive when clicking the edit icon on different types of bookmarks:

• News feed – Manage who is hidden from the news feed
• Messages and Events – Remove the bookmark from or rearrange its place within the Favorites bookmark section
• Friend Lists – Add to Favorites or hide the bookmark
• Apps – Edit app settings including permissions, add to Favorites, or delete the app
• Groups – Edit Group settings including notifications, add to Favorites, leave Group
• Pages – Add to Favorites

These changes will make it easier to unhide someone from the news feed, remove unwanted apps, and silence noisy Groups.

Streamlined Birthday Geetings

When users click on the birthdays section of the home page’s right sidebar, a popover is revealed with wall post entry fields for the profiles of all friends with birthdays that day. This allows users to quickly post “Happy Birthday” or a more personal greeting to each friend since they don’t have to visit their profiles individually.

Hidden Poke Button

As first spotted by AllFacebook, the Poke button on the profile is no longer visible by default. Instead, it has been buried in a drop-down menu in the top right of the profile along with options to video call, report/block, and suggest friends.

The poke is a relic of the earliest versions of Facebook, when users had few other means of communicating with friends or strangers. Since then, “poke wars” have become running jokes between friends. However, the feature is also often used by men to try to flirt with women they don’t know, which can create an offensive atmosphere for some women. Rather than suddenly removing the option, which could anger some users, Facebook appears to have chosen to make it less prominent in hopes of weening users off it.

No More Friend Request Messages

Previously, users could include some text when sending a friend request to greet a potential new friend and explain how they know each other. This option is no longer available, forcing users to send a separate Message. This might reduce the likelihood users will send an accompanying Message, which could increase the volume of rejected friend requests.

[Thanks to Dian Rosanti for the tip on birthdays]

Facebook will add new feedback buttons to stories in the news feed, according a TechCrunch source. Starting with “Read”, “Listened”, and “Watched” buttons, users will be able to indicate that they’ve already consumed a piece of content. This will allow them to provide more specific information about how they’re related to different types of content, which could help Facebook refine the news feed to show them more of similar types of content. The tip matches with the tagline “Read, Watch, Listen” which AllThingsD heard will be used for the f8 conference.

The granular feedback could also power the quietly launched Broad Category Interest targeting available in Facebook Ads, which lets advertisers target anyone with interests related to a selected subject rather than targeting those with specific Likes. For example, advertisers could target the category “Literature/Reading”, and Facebook could show their ads to users who frequently click the “Read” button on posts about news articles or books.

Facebook uses the Like button on news feed stories to improve its EdgeRank algorithm for determining what stories are most relevant to a user. Since Facebook currently has relatively little information about the content of news feed posts that aren’t tagged related to Pages, Likes of a friend’s stories result in that friend’s content appearing in the feed more prominently. If Facebook knew if a post was about a news article, band, or movie, it could make similar posts appear more frequently regardless of which friend published them.

The rumored “Read”, “Listened”, and “Watched” buttons fit with what we’ve heard about Facebook planning to provide developers of apps and websites the ability add more meta data or structure to news feed posts users publish about their content. A user could find a book on a review site, publish a post about it that is accompanied by meta data indicating they’re posting about a book, and Facebook could then show a “Read” button beside the story. Those who click the “Read” button would see more stories about books.

With Broad Category Interest targeting, which Facebook rolled out over the last few months but never announced, all this data becomes monetizable. A user wouldn’t have to formally Like the Page of a book for Facebook to know they’re interested in reading, because they often click “Read” on news feed posts. Rather than having to add a long list of popular book to Facebook’s traditional Specific Interest keyword targeting, an advertiser could simply target the “Literature/Reading” category. Then any users who Liked Pages of book or have clicked “Read” on news feed posts might see their ads.

For music and films, Facebook has Broad Category Interest sub-categories for different genres. The meta data provided by publishers might therefore include content genres, or at least titles that Facebook could cross-reference with a genre index. Then it would know to show more pop music news feed stories and ads to users who clicked “Listened” on a Lady Gaga post. Any posts that include content tied to Facebook’s rumored music, video, or news hubs would also receive the appropriate button.

Strengthening Broad Category Interest targeting could produce big revenue gains for Facebook. As we discussed earlier today, the Facebook Ads marketplace is inaccessible to many small businesses because they don’t have the know-how to effectively use the self-serve tool, or big enough budgets to use many of the tools and services built on the Ads API. As Broad Category Interest targeting is far easier to use than Specific Interest targeting, an improvement of the feature thanks to the “Read”, “Listened” and “Watched” buttons could help Facebook recruit this long-tail of advertisers.

Facebook contests used everything from discounts to cars to photos this week in our featured campaigns. We spoke to the VP of Marketing for Bonobos, looked at Nitto Tires’ car design sweepstakes, Zazzle’s giveaway and visiteurope.com’s photo entry contest.

You can see the full week’s coverage in the Facebook Marketing Bible, which also includes detailed breakdowns of over 100 other featured campaigns by top-performing brands and businesses on Facebook.

Bonobos’ 50 for 50 Facebook Campaign

Goal: Page Growth, Product Purchase, Network Exposure, Brand Loyalty

Core Mechanic: A Facebook campaign that gives users a higher discount on Bonobos merchandise as more users Like the Page.

Method: Bonobos bills itself as a web-driven men’s apparel brand and e-tailer, that uses heavy Facebook integration. We spoke to the company’s VP of Marketing Richard Mumby, who told us that Facebook ads and its Page were responsible for 50% of the company’s new customers.

This particular campaign, like most of the company’s campaigns, was developed in-house and takes a concept we’ve seen primarily with charities — pegging monetary amounts to the number of Likes a Page receives — and changes it up for retail. Essentially this campaign will provide users with 50% off purchases up to $500 on October 3 from the Bonobos website if the Page reaches 50,000 Likes by September 30. The campaign started at 23% to represent the 23,000 Facebook Likes it had. Mumby said the Facebook ads originally paired with the campaign became irrelevant because the virality of the campaign was taking care of itself. Currently the Page stands at 46,100 Likes.

Bonobos views Facebook as a way to engage customers with the brand, taking customers on a journey using the language and products that are already familiar to them. Facebook helps Bonobos bring the brand to life, as the tone the company uses to engage customers is “the way guys talk,” and then make the transition from knowing the brand to becoming a customer.

“The language we use and the syntax, the style of talking and engagement, is very much guy-to-guy, and so Facebook works very well for us,” he told us. “What we understand is that the more people that become a part of our Facebook community, the easier it will be for us to grow our business.”

Impact: The 50 for 50 campaign began on Sept. 12 and runs until Sept. 30 and already the campaign has already grown the Page to over 46,000 Likes. PageData highlights that in the days after the campaign launched the Page’s growth grew steeply.

How are top brands in the industry designing their Facebook marketing campaigns? See the Facebook Marketing Bible for detailed breakdowns of hundreds of Featured Campaigns by top-performing brands and businesses on Facebook.

Facebook IPO in Late 2012? – The Financial Times reported this week that Facebook’s IPO is set for the end of next year, with a valuation of what would be at least $66 billion. But The New York Times said Facebook was on track to go public in the first half of next year. Facebook itself hasn’t made any official statements about

FTC Proposes New Privacy Regs – The Federal Trade Commission proposed rules this week that may affect how children under 13 use the Internet. Mobile web apps are now included in the rules, for example, and so may require parental consent for use.

Update on Case Sensitivity of Passwords – ZDnet wrote a piece this week in which Emil Protalinski found that Facebook passwords are not entirely case sensitive. Facebook responded noting that the site accepts three forms of your password: the original, the original with the first letter capitalized (to accommodate mobile devices) and the original password with cases reversed (to accommodate a caps lock being on).

Facebook’s FBAR – Facebook’s Engineering Team wrote a note this week detailing FBAR, or Facebook Automatic Remediation. These are scripts that detect errors or breakage in servers, automatically removing them from the system, determining the problem, alerting a technician to replace the drive, testing it and re-adding to Facebook’s infrastructure. It now manages more than 50% of Facebook’s infrastructure and is doing the work of about 200 system admins. [Image Via Facebook]

Skype, Facebook Integration 5.4 – Skype released its Mac updates recently that includes a Facebook integration that allows you to IM and connect with friends without leaving Facebook, also allowing you to read/update the feed, comment Like and more.

Custom URLs Available to Anyone – Facebook no longer requires users or Pages to need 25 friends to acquire a custom URL.

Fake Facebook Name Not a Felony – Forbes reported this week that, despite an initial concern that a fake Facebook name could be considered a felony under the Computer Fraud and Abuse Act, an amendment added eliminated this possibility.

App Allows Cross-Platform Posting – If This Then that allows users to cross-post to dozens of programs for content management purposes, such as instant messaging to your blog.

The following is an excerpt of entry in our Facebook Marketing Bible. The full version contains a walk-through of the Share button and View Shares feature, strategies for encouraging shares using your Page’s info tab, and more examples of the best and worst types of updates to add calls to share to.

Making the posts you publish stand out in the Facebook news feed is crucial to maximizing primary key performance metrics such as brand lift, clicks, impressions, Likes, comments, and reposts. Your updates are competing with highly compelling content published by the friends of your fans, so you need every advantage you can get.

Facebook news feed updates by both users and Pages display a “Share” button that lets users repost that update to their friends. Updates that have been reposted at least once display a count of how many times they’ve been reposted next to a link labeled “View Shares”. This link helps posts stand out in the feed and indicates to your audience that other users thought the update was important and its therefore worth reading, clicking or reposting. Its important for you to solicit Shares of your updates so they receive this distinction.

Here we’ll walk-through how the View Shares link works, and provide strategies for how you can attain Shares and the benefits they bring for your business.

For information on how View Shares works, see our article on the feature’s release. The full version of this Facebook Marketing Bible entry contains a walk-through of the feature written specifically for businesses.

Strategies for Taking Advantage of View Shares

Shares have a two-fold benefit for publishers: they generate additional impressions, and they create a social recommendation for the original update that increases engagement via View Shares. Therefore, the more Shares that publishers can attain the better. As such, you should encourage users to Share your posts.

Though you’ll have to lengthen your updates and avoid annoying your fans, appending calls to Share to some of your news feed updates can be a very effective method of attaining reposts.

Some examples of posts you might want to add a call to Share to include:

• Posts promoting tab applications on your Page – “Check out the fun new game we’ve installed on our Page and click Share so your friends can play too”
• Links to buy products from your ecommerce store – “We just launched our new line of purses. Buy them here and click Share to show them off to your friends”
• Links to something special on your website – “We’re streaming a concert from our offices on our website. Click through to watch and hit Share so your friends can hear this awesome new band”
• Sales that users will naturally want to share with friends – “Today only: 2 for 1 t-shirts on our website. Click Share and your friends will thank your for their cool new clothes”
• Giveaways –  ”You and your friends can get caffeinated together for free. All you have to do is click Share on this link to get coupons for a free coffee at any of our stores”

Uses there strategies and soon you’ll be getting plenty of Shares on all your posts, and everyone will know thanks to View Shares.

The full version of this article, complete walk-throughs additional strategies, and tips for getting more Shares without annoying your fans can be found in the Facebook Marketing Bible, Inside Network’s complete guide to marketing and advertising through Facebook.

Facebook users are seeing a new “View Shares” link beneath news feed stories by friends, Pages, and those they subscribe to. When clicked, it opens a popover window displaying who has reposted that story and any additional context they added. Users will only see shares visible to them, meaning any post published publicly or by one of their friends.

View Shares constitutes the third news feed story feedback metric visible to users, joining Likes and comments. It indicates what news feed stories are most popular and that users might therefore want to read, click through, or repost themselves. The link’s presence could help alert users to the availability of the Share option and increase its usage. It will help Page admins who previously had no way of telling how frequently their updates were reposted. View Shares might also push content publishers to more directly encourage their readers to share their posts.

The feature now appears on posts by both users and Pages. In the popover revealed by the View Shares link, reposts where users added an optional description display that text, while those without additional context read “Name shared a page: [Page name]“. The feature respects privacy, as only users who could already view a repost will see it in the View Shares pop over.

Users have long had the “Share” option to repost the news feed stories they see, but data about the quantity of reposts was never displayed on the original story. Likes and comments both benefit from having the volumes of these feedback types displayed on posts. Now the Share link has the same expanded presence, which may serve to remind users about the option.

Somewhat oddly, the volume of Shares of a Page’s posts is not included in a Page’s Insights. Admins can now find this data by viewing their Page’s own posts, and the data will also probably be added to Insights in the near future.

While reposts previously helped publishers gain a burst of additional impressions, they didn’t provide a social recommendation for the original story to its viewers the way Likes and comments do. Those feedback types can help improve a post or publisher’s EdgeRank, or prominence in the news feed, but they usually don’t expose the post to a user’s own network.

The View Shares feature means Shares will give posts both immediate exposure to a user’s friends and a permanent recommendation. Since there are more benefits to Shares for publishers, they may want to increase the frequency with which they ask users to Share their posts.

Page admins might not be entirely happy about the change, though, as now when a user Shares one of their posts, it doesn’t include a “via [Page name] link back to the Page that originally posted the story. This means Shares no longer offer Pages an opportunity to gain new fans.

[Thanks to Dan Birdwhistell, Jesse Ferrell, Brittany Darwell, and Amit Lavi for all sending in tips]

While Facebook product launches tend to get the most speculation before the f8 developer conference  – there are 750 million users who care, after all — the company has often used the event to push grand presentations that instead target developers.

That trend may be the case again next Thursday, we’re hearing from a trusted source with some knowledge of what the company has planned.

Developers might be getting new access to Facebook’s news feed, building off of the graph API that Facebook presented at last year’s f8. They’d be able to provide new structure to the information they share into the news feed, allowing Facebook’s news feed algorithm to present it to the audience most likely to find it relevant and engage with it.

Update: Facebook spokesman Jonny Thaw has also confirmed with us that “Yes, there will be platform integration” for Smart Lists. This includes the ability for developers that have been granted access to a user’s Friend Lists to publish content specifically to members of Smart Lists.

The goal is to help developers focus on sharing what’s right for users (not just their own traffic and revenue numbers), while giving the users themselves a more subtle and serendipitous experience.

With a more structured input of information, Facebook could then match content to users who’ve previously enjoyed similar content. It could also measure which developers are producing the most beloved content, based on factors like users resharing or hiding the story, and reward the developer with more visibility for their stories. That would create a more virtuous cycle where high-quality developers become more prominent, inspiring more user engagement that benefits both developers and Facebook, the company no doubt hopes.

Structured Content for Enhanced Relevancy

To understand what the changes mean, one example might be the well-understood problem of social game spam. Say a user achieves a new high score in Scrabble, an event that’s exceptional enough that they want all of their friends to know about, not just their Scrabble-playing companions. A developer could structure the story about the high score to signal to Facebook that it is of more general interest to all of a user’s friends, or maybe just the larger subgroup of friends who have played some social games on Facebook, but have not installed Scrabble.

In another situation, a local business discovery app could structure the content shared by its users such that Facebook knows its more relevant to local users. The content would then appear more prominently in the news feed to those living in the same city as the user posting it.

This isn’t just about games and apps. The change would impact anyone sharing any information to Facebook, including all of the sites that have installed the Facebook Like button and other plugins since they launched at f8 last year, or integrated with Facebook Connect (in total, Facebook’s official stats say that more than 2.5 million sites have integrated it so far).

Developers can already ask users permission to access their Friend Lists, but since they’re unique to each user, it’s difficult to know what type of audience corresponds to what list. With platform integration for Smart Lists and special lists, which Facebook confirms with us will be available in a few days, developers will be able to ask permission to target updates published by users through their apps to local friends, classmates, coworkers, family, Close friends, and Acquaintances.

Currently, the Graph API allows developers to provide a variety of more straightforward meta data about the content they publish, like the title of the info they’re sharing, a blurb, etc. But Facebook has used other signals in its news feed algorithm to figure out what to share and with whom, such as who a user’s closest friends are based on photo tags and who’s Liked a user’s previous posts.

The Context Is Right for This Launch

In the past, Facebook has taken blunter measures to fight spam, with methods such as clumping all stories from specific applications into a single thread, and hiding most stories about social games from friends who have not installed the app.

It has also taken a still-changing approach to how users make the news feed work for them. It has constantly iterated on the news feed algorithm since bringing it back a few years ago, and tested features that ask users how often they want to discover new games, or what types of content they prefer to see in the feed.

Just today, it officially launched a variety of Smart Lists and special lists – automatically created and populated lists of a user’s local friends, coworkers, and those that share other characteristics, and lists of best friends and distant contacts whose members appear more or less in the standard view of a user’s news feed. It’s probably not a coincidence that this particular launch is coming now. Users can apply the Friends Lists as news feed filters, but Facebook could allow developers target some stories to these lists as well. For example, the Scrabble high-score story could be formatted to be shared with the “Acquaintances” list, while less monumental stories would be formatted to just appear for “close friends.” That example is, to be clear, just a guess based on what our source has said.

Thinking more long-term, Facebook has steadily laid the foundation for this move over the years. The first f8, in 2007, was where the app platform was unveiled. Facebook Connect came in 2008, which started Facebook’s reach outside of the site by helping people to log in using their Facebook identities. The Graph API came at its next conference, last year. In addition to the consumer-facing social plugins and instant personalization, the company created the Open Graph protocol system for assigning web pages meta data that improves the format of news feed stories shared from them. The plugins utilizing this meta data pushed Facebook across the web. All that effort on the part of Facebook and its growing ecosystem now makes this change a natural progression.

In this context, the other big and interesting things that Facebook is rumored to be launching — a music platform that might include a scrobbling tool, a mobile web development platform, an iPad app — are more pieces of the puzzle that Facebook has been putting together. That is, making anything, from a catchy song to a popular mobile game, get the exposure it deserves to the users who want it.

The move would also aid Facebook against long-time competitor for owning and distributing the world’s information: Google. The launch of better methods for sharing quality information into Facebook could help it improve its news feed and box out Google, which is trying to move its new social alternative Google+ to the mainstream. Last year was about Facebook pushing itself out to the world via plugins, this year could be about pulling more of the world into Facebook.

Want to join us for some casual drinks, rumor and speculation the night before f8, come to the Inside Network happy hour next Wednesday at Mercury Lounge in SF. RSVP here to get a free drink on us.

Josh Constine co-authored this article.

Badgeville, developers of an embeddable gamification platform that helps websites increase audience engagement, has just launched several new features it calls Social Fabric. Clients can now pay more to add personalized activity streams and a notification system to their websites.

Similar to Facebook’s news feed and notifications, the features show users relevant suggestions about what webpages to visit based on the behaviors of their friends and people similar to them, and alert them to actions such as other replying to their comments. To make these suggestions more compelling, Badgeville augments the activity stream entries with Facebook Open Graph protocol meta data that sites have added to their pages, and identifies a user’s friends and interests by piggybacking on Facebook registration.

Through Social Fabric, Badgeville lets websites integrate of the most engaging mechanics used by Facebook to drive more page views, conversions, and time-on-site. With more flexibility for data collection and display, Badgeville is now a competitor as well a complement to some of Facebook’s social plugins.

In just a year since launching, Badgeville has found success in assisting web publishers with increasing traffic. It now has 85 customers including NBC, Universal Music Group, and Orange telecom, has done $5-10 million in sales. Its team numbers 35 and it raised a $12.2 million Series B round in July bringing it to $15 million in total funding. The company says it clients experience a 25% or greater increase in user behavior.

Badgeville founder Kris Duggan tells us his company “isn’t walking from gamification” that formed the core of the product we reviewed last year. The Badgeville platform still allows sites to reward points, reputation, spots on leaderboards, and badges to loyal users. Instead, its layering the social graph over gamification such that users stay engaged not just because they’re formally rewarded, but because it’s easy to discover content vetted by their friends and people with similar behavior patterns to them while they earn these rewards.

Duggan explains that currently, sites that integrate Facebook plugins are focusing too much on the interest graph and not enough on what he calls the “behavior graph” — what people are actually doing rather than what they say they’re interested in. Badgeville lets sites track and/or display what visitors read, review, or purchase, “not just that a friend Liked a site’s Page three years ago, not just that they shared something.”

In this way, Badgeville is looking to replace Facebook’s Activity Feed and Recommendations social plugins that only report explicit behaviors of users. With 2.5 million sites having already integrated Facebook’s free plugins, its logical to assume there’s a premium market waiting to be addressed.

Now, sites who license Social Fabric can select which user behaviors they track for internal analysis, and which the surface through the activity stream and notifications. For example, it could show an activity story whenever a friend visits a URL on the site. That Page’s title or headline can be determined by crawling its Open Graph protocol meta data, which Duggan says 80% clients already have in place. Clients can also decide what actions trigger notifcations, such as comment replies or that a friend commented on the same page.

There are some privacy issues Badgeville will need to be careful with. Surfacing explicit actions such as shares or comments isn’t a big deal, but users might not want what they read or purchase shown to their friends or strangers. Duggan says that Badgeville advises clients, but doesn’t have an privacy messaging set up to accompany its widgets with disclaimers that inform users as to what will be published.

He says he doesn’t see privacy flare-ups harming Badgeville’s reputation as “we’re just the infrastructure”. But if a client gets slammed for publishing to a user’s friends that they bought an embarrassing product or read a controversial article similar to Facebook’s ill-fated Beacon, you can expect some backlash and dropped contracts for Badgeville. Therefore, the ability to display privacy warnings should be a high priority for the company.

Facebook is known for its massive time-on-site and reengagement metrics, which in part stem from the engrossing nature of the news feed and notifications, but the social plugins it currently offers can’t track or report as much data as sites might want. Using Badgeville’s flexible platform to inject the social graph alongside these mechanics into their own content-rich websites, clients may be able to inspire similar engagement by ensuring users always have relevant suggestions of where to click next.

Facebook is currently testing a new feature called Smart Lists that automatically groups friends with common characteristics into Friend Lists that dynamically update themselves over time. Previously, Friend Lists had to be manually assembled and updated — a chore that contributed to them being used by only 5% of the user base. First spotted by Nick Starr, Smart Lists are now being created for the coworkers, classmates, and friends who live within 50 miles of users in the test group.

Since Smart Lists can be selected within privacy settings and the news feed publisher to determine who can see profile or posted content, they could encourage users to micro-share to specific subsets of their friends. This allows them to post a wider variety of content to Facebook, enriching the site. With Smart Lists, Facebook has leveraged the wealth of data it has about the interconnections between its users to drastically reduce friction in the Friend List creation process, and one-up Google+ Circles that must be laboriously built by hand.

Facebook is also now showing a tool tip explaining how the previously available “Friend List Feed Filters” work when users choose to filter the news feed by selecting a Friend List from the Most Recent drop-down menu. While viewing the filtered feed users can manage the members of the Friend List and confirm Facebook’s suggestions for additions to the list. This change educate users about Friend Lists and make manually created ones easier to keep up to date.

Since December 2007, Facebook has allowed users to assign friends to Friend Lists that can used as news feed filters, distribution parameters for posted content, and visibility settings for the profile. However, their buried place in the interface, the slow creation process, and the fact that explicitly categorizing friends is somewhat unnatural made Friend lists a feature that only attracted power users. CEO Mark Zuckerberg said at the launch event for the Groups feature in October 2010 that only 5% of users had created friend lists.

Over the years, Facebook has tried to surface the feature in more places around the site and make them a little easier to create. While creating friends lists, users gained the option to sort them by parameters such as Recently added as well as profile characteristics including those used to create Smart Lists to speed up assignment. Later Facebook started allowing users to add someone to a list when they confirmed their friend request.

In October 2010, Facebook began showing suggestions of people to add to existing lists based on similarities with previously added members — the closest thing to a predecessor to Smart Lists. Previously these suggestions appeared only in the Friend List editor interface, accessible through Account0 -> Edit Friends, but now they appear beside the news feed when filtering the feed with a Friend List.

Contact sorting and micro-sharing have become bigger issues over the past few months. Google+ was applauded for its drag-and-drop Circle building process that was faster than building Facebook Friend Lists. Third-party developer Katango recently built a product that “auto-magically” build Friend Lists by clustering similar friends and allowing users to export the lists to Facebook. Both products raised the question of why Facebook, with all its biographical and behavior data, couldn’t automatically create Friend Lists for users.

Now Facebook has shown that it can automatically build Friends Lists. Users currently in the limited tester base for Smart Lists have lists for coworkers, classmates, and local friends automatically created for them. The feature doesn’t go as far as Katango, which uses a wide variety of signals to create more than a dozen lists for users such their closest friends or people met on a vacation, as well as those made by Smart Lists.

Facebook very well may improve the feature in the future to create Smart Lists from more subtle clusters of friends and not just those who share an explicitly listed characteristic. The tool tip explaining the feature notes that users can remove friends from Smart Lists at any time, allowing them to expel friends mistakenly admitted to lists where they don’t belong.

The fact that Smart Lists update themselves in response is a huge improvement over Katango and Google+. As more friends move to a user’s city or join their company, they’ll be automatically added to the corresponding Friend Lists. With the friction of building and maintaining lists removed, a roll out of Smart Lists could significantly increase adoption of the Friends Lists and micro-sharing.

Users may be more likely to share professional, nostalgic, and local-focused content by restricting the visibility of these posts to just those they’re relevant to. Without lists for these subsets automatically created and ready, users might have never shared these types of content, making Facebook a less interesting place for their friends to visit.

Smart Lists could also erase one of Google+’s core advantages over Facebook. The feature’s launch underscores a deficiency in Google+’s growth strategy of rolling out to early adopters first without a clear way to bring mainstream users aboard they way Facebook did by opening at one college at a time. As such Google revealed its Facebook-besting features but hasn’t been able to gain massive traction since, giving Facebook time to catch up.