June 27, 2012 Cam Levack
Facebook is not a successful medium for advertising, a recent Reuters/Ipso poll indicates. It discovered that “four out of five Facebook Inc. users have never bought a product or service as a result of advertising or comments on the social network site.” But, is Facebook an advertising medium?
It’s been a tough June for Facebook, most notably General Motors’ decision to pull its $10 million ad budget. Investor worries have pushed the online giant’s stock down 29% (June 5) in one month, reducing its marketing value by a whopping $30 billion. A vicious circle is in place, with 44% of respondents feeling “less favourable” to Facebook, attributable to its much-publicized stock problems.
A number of issues come to play. One is the difficulty in accurately measuring Facebook’s advertising effectiveness. It’s one thing to gauge the impact of a retail sale event, another to see impact on brand awareness.
Another is “Facebook fatigue”. Users constantly expect and demand new kinds of interaction, a problem traditional broadcast of print advertising doesn’t face.
Some critics even argue that Facebook is not an advertising medium in the first place, calling it instead a “consumer engagement tool”. Understanding the difference could be the key to the success of Facebook, and those who choose it for marketing.
Facebook isn’t taking this lying down. For one, it’s introducing a new “Tool for Advertisers”. The June 1 business section of The Globe and Mail reported that Facebook is quietly rolling out “Promoted Posts for Brand Pages”. They allow small to medium-sized businesses to promote their content “via a new button on the Page composer” – a promoted post will create a sponsored story or ad that can reach “fans and friends through their Page”. And because Promoted Posts are clickable, they’re measurable.
It’s just a start. But bridging the gap between over advertising – something most Facebook users are striving to avoid – and the promise of meaningful, interactive content – has to be Facebook’s long-term advertising strategy. 900 billion users around the globe is just too much potential to pass up
Cam Levack, Raven5 Ltd, Toronto, June 2012