Today’s piece is a bit out of the norm. I’m not talking about advertising in social media… but rather how social media giant Facebook is under some major scrutiny and how it’s affecting the world’s perception of social media.
Facebook announced a few months ago that it was going to go public. It seemed like the right time. With a valuation of $100 billion, who wouldn’t want to go public?
At the time, I don’t think the Facebook crew was ready for the vast amount of public scrutiny they were going to be facing. Today, General Motors announced it was pulling its $10 million advertising deal and research has come out saying that only 43% of Facebook users have actually clicked on an ad. To the average person, this would certainly lower the consumer confidence in the Facebook brand and offering; however, I believe this only illustrates the social media giant in a good way.
First, let’s dissect the GM deal cancellation. While $10 million dollars is definitely something to be upset about, it is an aspect of real life and, more importantly, business. Deals come and go all the time.. but they just aren’t always publicized in the light of a company about to go public. Every day, some company is pulling the plug on some aspect of their marketing and advertising efforts. Teams across the globe continually analyze the means that they’re utilizing to tell the world about their product. It’s a matter of whether they believe the value of the means is worth the investment. Obviously, General Motors did not feel that advertising via Facebook was worthy of their advertising budget. But, this publicity has not gone unnoticed and I’m sure some advertising giant will step in and fill the “void”– per usual.
Secondly, we should consider what 43% of Facebook users clicking an ad really means. While that percentage is pretty low, it is definitely making a big statement. For a company that reaches 901 million users, 43% isn’t too shabby. That means that roughly 387 million people have clicked on an ad. There is definitely still room for growth, but this should not be of concern. Even though Facebook only has click-through rates 2-3% greater than other advertising media, the fact that Facebook has incredible reach with extreme accuracy should be proof that it is a valuable way to reach consumers. Advertisers should recognize this medium as an opportunity for growth and exposure, not as a reason to worry.
Listen up advertisers! It’s time to take notice of what is really happening on the internet. Brands are 1) creating campaigns using Facebook 2) connecting with their consumers’ feedback using Facebook and 3) even creating call-to-action messages for consumers to visit Facebook pages. Time to join the fun and realize that Facebook is a great medium– even if you’re only seeing clicks from 43% of the Facebook population!
The Facebook IPO will prove to be invaluable. With spray-paint artists making millions, Mark Zuckerberg becoming the youngest billionaire, and the public being able to purchase and profit from the giant, this week will definitely be one for the books. Other social networks should take note of how Facebook grew, took on the advertising and communication industries, and grew to be worth $100 billion company.
Time to broadcast your faith in the social network. Facebook is here for the long haul and we all should get connected! Check out the offering on E*Trade.
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