MicroStrategy bets big on Facebook data

If businesses have any doubt about the importance of Facebook data, they should talk to MicroStrategy CEO Michael Saylor.

MicroStrategy makes business intelligence software that companies use to sift their way through in-house data and visualize trends. But their internal data is worth much more when looked at in the context of Facebook data about their customers or would-be customers.

“Facebook as a network is the only source of a billion-user registry on the planet. It is destined to be the white pages for a million companies,” Saylor said on a conference call on Tuesday.

Just as individuals use Facebook to keep their personal contact info up-to-date, a company can use Facebook to track the Likes and affiliations of Facebook users that Like that company’s products and services.

With Facebook users updating their own information, it will replace the “white pages of the world,” Saylor said.

Wisdom enables Facebook data mining

MicroStrategy’s free Wisdom app, which has been available since November, lets Facebook users analyze their own friends’ information — who has birthdays in June, who likes Barack Obama, who’s a Mitt man — but it also aggregates that anonymized data on the back end.

Companies can take advantage of that rich trove of demographic and psychographic information, and MicroStrategy will help them do so. ”It gives you a window into the Facebook universe,” Saylor said. MicroStrategy started gathering this Facebook data from Wisdom on Nov. 21 and has added 80,000 people’s data every day, Saylor said on Tuesday. Wisdom network now includes data for more than 4 million people.

Steve Stone, the former CIO of Lowe’s Home Improvement and now SVP in charge of MicroStrategy’s cloud intelligence strategy, talked to GigaOM a few months back about the importance of social data to retailers and especially the importance of Facebook data.

Saylor demonstrated the app at the MicroStrategy Summit in Miami this week, showing how it can slice data by country, language or other criteria. “We can identify 94,000 people for whom German is the primary language and identify explicit likes of those people,” he said.

The gold rush for social networking data

MicroStrategy is not the only company drafting off data from popular social networking services. DataSift and Gnip aggregate and cull data from the Twitter firehose, for example. But many feel that Facebook eclipses all other social network data sources. For one thing, people willingly enter all sorts of information – the movies they like, their favorite sports teams, their drink preferences, their political leanings, the books they like and the devices they like to read them on — which makes for a very rich data set. Many of them Like a certain company or its products. That’s the point of entry for business marketers. Second, there are more than 800 million people and counting on the network. Saylor’s 1 billion figure probably isn’t far off.

Taken altogether, that’s a much bigger data set than most companies dream of. ”Nielsen [ratings service] polls 25,000 families that determine the entire advertising business. We just scanned 4.8 million families grouped by what movies they like,” he said.

Queried about why such reliance on one company’s information is not risky, Saylor said it’s more dangerous for companies not to glom onto Facebook data.

“People that embrace and make investments in it will grow and prosper. Others will reject it or be afraid of it,” he said. “You can embrace it or stick your heads in the sand and ignore it [at their peril]. I don’t have to tell you that — the Syrians, Egyptians and Tunisians can tell you that.”

Many already have privacy concerns about oversharing on Facebook. But those worries appear to be generational: Younger people don’t have as many qualms about putting all aspects of their lives on social networks, provided they see an advantage in doing so. Still, banking so heavily on a single data source, which is, after all, controlled by another entity, has to be risky for companies like MicroStrategy.