With over 1 billion users logging in worldwide each month it is one of the largest closed marketing channels in the world.
It’s no wonder that the shares were oversubscribed when the company went public in May 2012 with a peak market capitalization of over $104 billion.
The business potential was too great to ignore.
Although more and more companies are finding it increasingly difficult to get commercial leverage and obtain an ROI from marketing activity on Facebook.
Around the same time as the IPO, General Motors pulled their ads due to a lack of return. And they aren’t the only ones to find Facebook is not laying the promised “Golden Egg”.
Facebook is Broken
Facebook is a social platform, it’s a place where friends and family exchange photos, jokes and have semi-private discussions. You go on Facebook for entertainment and social interaction, when doing so you leave behind a trail of data that identifies your likes, dislikes, wants and wishes. From what music you listen to, to your favourite breakfast cereal.
Marketing companies can then tap into this data, known as the Opengraph, and attempt to show you relevant ads or posts. The problem being that that decision is usually being made by a human, based on wide assumptions that a person liking A and connected to B will like product Z.
Combine this with the intent of the visitor, on Facebook it’s largely to interact with friends and family, then getting them to divert them from their original goal can be difficult.
This is interruption marketing but without the big glossy ads.
Google is Intelligent
If ads don’t work on Facebook why are similar ads, ones that don’t even have images, so effective on Google? The key difference is intent.
Yes marketeers are still making decisions about where their ads appear, relevance, but now it is based on search phrases rather than complex data mining.
With Google Ads, intent is the key ingredient, and intent is determined by the phrase used by the searcher. Match your relevant ad with intent, and achieving an ROI is a lot easier.
Facebook knows this and is playing catchup by introducing it’s ads to it’s own search results, although I fear the intent of a search on Facebook is going to be very different from that of one on Google.
The “Cheap Red Rucksack”
If you have cheap red rucksacks to sell, all you need to do on Google is to get your ad to display when this phrase is used, and with decent copy you stand a good chance of a click. If the ad then leads to a page with cheap red rucksacks on it’s likely you will sell one.
On Facebook you have to work out who may be interested in cheap red rucksacks. Someone that goes camping or to festivals or is about to go on holiday perhaps?
Even if you know they fit one of these criteria, you have no idea about the colour, price preference, or if they even need for a rucksack. So good copy in this type of ad on Facebook may result in a click, but that is just as likely to be out of curiosity as it is out of intent to buy.
Social Advertising Needs to Grow Up
As the social platforms look to find ways to monetise themselves their advertising models are adapting but they are still stuck in interruption mode. The issue is that interruption advertising is exactly the opposite dynamic that makes social media marketing work so effectively.
It may be no coincidence then that Google hasn’t yet introduced Adwords on to Google+. It would be very easy to do, instead it has adapted Google Places into Google+ Local and integrated Zagat reviews, a much softer approach.
Social platforms are for building authority, trust and relationships. For interacting with colleagues, friends and family. A boon for niche interest groups and activists. Above all “social” is one of the best ways to reach potential customers and build long term loyalty, using technology for the co-creation of value.
We can’t continue with the same ad models, in a space that doesn’t support them; a solution is out there, it just hasn’t matured yet, or has it?
If you need help with your online marketing then please get in touch, for a free initial consultation call Sean today on 07850957506.