• Reuters, Friday, November 23, 2007 11:45 AM

Facebook is coming under fire for "Beacon," the advertising program that turns users into product-pushers by automatically recommending the products and services they buy. According to reports last week, Facebook users joined the consumer activist group MoveOn.org in criticizing the marketing tactic for compromising user privacy.

Despite the criticism, a new study from the UK-based Royal Mail and Future Foundation indicates that the social networking startup might be onto something with the recommendation program. It finds that, just as Mark Zuckerberg intended, social network users are more likely to buy a product or service following a recommendation from another user--which means that marketers should start encouraging users to recommend their products. For example, they could use Facebook's Open Platform to send product review forms and encourage them to fill them out by offering discounts and other incentives to completing the form. Successfully doing so would help brands build "a sense of community and awareness."

However, brands have to be careful about how they do this. "If it happens that your brand gets exposure, then that's great--but they can't be seen to be looking for it," Christian Robinson, managing director of online-retailer Firebox.com, told Reuters. "Customers are just too savvy ... and cynical about big brands' attempts at viral marketing." Which places them in a bit of a conundrum, as social networks don't really offer a formal way to stimulate conversations about brands.

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