Facebook and the 300 Million Number
You may have heard the recent news ,the impressive reveal that Facebook now has a staggering 300 Million users worldwide. Even more impressive is the news that they are cash flow positive, with a 2009 revenue forecast of $500 Million.
Wow. 500 million in revenue from a business model that is consistently under heavy scrutiny is not bad, or is it?
What I mean by this is that Facebook makes money selling adspace and sponsorships, just like any other online destination. The biggest selling points for Facebook are the sheer scale of its users and the stickiness of the site.
But what does this mean for marketers if Facebook is making money? To me it reinforces the widely accepted belief that many of us are still struggling with how to integrate the powerful reaching social media phenomena into our plans.
Buying an ad on Facebook and contributing to their positive cashflow is not a viable tactic to engage in social media. So if you have been feeding the beast in this manner, please stop. Here is some research that discusses the impact of ads on social networking sites vs. other sites. Although the data is from Nov 2008, the findings are widely accepted.
It is important for most companies to be involved in social media but the level of engagement depends on the relevance of the various platforms to your target and the reason why you would like to be involved in the first place. Are you looking to drive sales? Are you looking to learn more about your potential customers? Are you looking to interact with your current customers? These are all questions that will help guide your strategy, which in the end should be tied to a business objective.
One must avoid the GMOOT at all costs (see The Return of The Brand as King). Dove Canada is a great example of how social media, in particular Facebook can be leveraged. Read some of the comments that are posted by some of the 2,309 fans - who wouldn’t want their brand to have these fans…
