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Marketers accept Facebook as effective ad platform

Marketers accept Facebook as effective ad platform

Marketers are accepting social networks as part of the advertising mix as more brands look to sites such as Facebook to promote themselves.

Marking a shift in attitudes towards social networks, more than 80% of the largest US advertisers are using Facebook including big brands such as Johnson & Johnson, Starbucks and Nike.

In the UK, the site has attracted advertisers including Apple, H&M, Cadbury and Coca-Cola. Furthermore, according to SEO marketing agency Tamar, 90 out of 100 of the world’s biggest brands (according to the Interbrand 100 index) were the subject of Fan pages by the end of 2008.

Companies were initially hesitant to advertise on social networks because users appeared resistant to advertising. There were also fears that corporate logos might appear alongside offensive content.

But unlike previous big brand promotion on the web, the ads on Facebook are not splashy displays and banners. They are discreet and aim to blend into the overall design of the site.

They typically invite users to engage with companies. By letting consumers ‘join the conversation’, brands are opening up to consumers on a personal level which then leads the consumer to pages and applications where they can become fans of the company and receive regular updates about the daily going ons.

This sort of relationship between a brand and a consumer has never before been so easy or so accessible – not even via a website consumers come to after a Google search.

It is this that has triggered a strong consumer response: suggesting that Facebook users are comfortable using product allegiances (sometimes even declaring ‘brand love’) to help define themselves.

Starbucks has more than 3.7 million fans on its Facebook page, while Coca-Cola has more than 3.5 million, according to the Financial Times.

Facebook does not charge companies to have a fan page or an application. So how does it make money out of brand advertising? Facebook releases very little financial information.

However, CEO Mark Zuckerberg recently predicted revenue growth of 70% this year and said Facebook would be cash-flow profitable next year.

The Financial Times reveals that Facebook is “already doing more than $500m in revenue this year”, so perhaps Facebook really is the Holy Grail of advertising after all...

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