Jun 2010

Facebook advertising for the future?

Posted in Advertising, Business tactics, Social Media | 0 Comments

500 million users? That’s not nearly enough, well according to Facebook’s chief executive Mark Zuckerberg who said that they are on target to have one billion users.

Speaking at the Cannes Lions International Advertising Festival on Wednesday, Zuckerberg who picked up Media Person of the Year, revealed his plans to maintain growth for Facebook.

The aim is to crack the markets in China, Russia, Japan and South Korea. These are the only countries where Facebook is not the leading social network, he said: “We are down to [the above] four countries that we are not the leading social network in, now for the first time we are focused on doing some specific things in specific countries.”

The most interesting part of the hour long Q & A is the company’s attitude to advertising. According to Ian Maude, an analyst at Enders, “The fact that Zuckerberg is going to one of the main advertising events shows they are taking that very seriously.”

And it has been reported that they are expected to make $1 billion this year from revenue. Zuckerberg has big plans, saying “It’s a similar dynamic on marketer side as it is on developer side. We’ve built an A-class developer platform and we need to do the same for advertisers.”

But in case you thought they haven’t put their plan into action yet, Zuckerberg argued that advertising on Facebook is “squarely out of the experimentation phase.”

He pointed out that Nike’s recent decision to debut its World Cup ads on Facebook had led to the rapid addition of 3 million connections to the brand’s pages. And he said that Disney/Pixar’s decision to support Toy Story 3 ticket sales on Facebook is an example of a brand helping users connect with each other.

But what does this mean for smaller businesses? Well, the future is looking good for you, it seems Facebook could help even the smallest of SMEs (Small and Medium size Enterprises).

In the US Facebook took over from Yahoo! as the top publisher of display adds on the Web. AFP reported that according to online tracking firm Comscore, Facebook delivered 176.3 billion ads to US users in the first three months of 2010, a 16.2 % market share, more than double its 7.5 % share of last year.

However although Facebook may be running more adds, MSN Money reported that Yahoo! is still making more money because the ads rates for social media sites tend to be lower.

So Facebook aren’t making much money but will you? The thing with Facebook advertising is that you won’t instantly make money from it. What Facebook does is give you a change to get social with your potential clients so you can really build up a relationship with them.

Facebook is different from other advertising techniques because instead of targeting absolutely everyone it is much more specific. There are 11 different factors that Facebook uses for its advertisers, they are location, age, sex, keywords, education, workplace, relationship, interested-in and languages.

Zuckerberg said at the conference that Facebook is close to providing location-based advertising services:

“We are working on this, knowing where a person is and being able to personalise what’s around them,” he said.
This would be great for businesses as they could deliver ads to users who are near their place of business or they could let them know about any deals.

So is this the future of advertising? Will all businesses go via Facebook in the future?

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