I run a consulting business. For me, FB is a blackhole of advertising dollars.
I have an artist friend who draws robots. His advertising dollars on FB have resulted in 10’s of thousands of page fans, customers from Europe and Asia and a very significant bump in revenue.
FB ads are great for that type of niche player. The deep personal dataset that FB has about it’s users can identify jackasses who would buy robot paintings from across the globe, greatly benefiting my robot drawing friend. GM is getting shit canned for backing off on FB ads, but it’s just a result of the fact that GM knows FB ads don’t work for selling cars.
But, if you sell robot paintings FB is awesome.
Does that make a company worth $100 Billion?
On a related note, I caught up with a colleague I hadn’t seen in a long time. I asked how business was going and he told me he has switched jobs. He now does “Facebook consulting”. Intrigued, I sat with him for an hour and asked questions. He told me that being “liked” on Facebook is the best customer marketing drip campaign tool available. He estimates a “like” on FB is worth 10x the value of someone’s email address.
Here’s how Likes works as a basic formula. You are friends with “thefly” on Facebook. Fly likes the page of my friend who draws robots so now he receives robot updates in his stream. Fly then likes a robot drawing. You see that in your stream and since you know and like the Fly and have a passing interest in robots (I mean, who doesn’t) you are more likely to look at the pic, reshare, follow the link etc. It’s a 1+1=3 type scenario. Your friendship with Fly plus everyone’s passing interest in robots = 3x more likely to gain your attention. Add a request for action and that doubles. It all starts out with Fly “liking” the robots page. This is why you see LIKE buttons on every web page and at many local businesses. Look around, you’ll see LIKE logos/buttons are everywhere.
Additional FB marketing tips from our conversation. Using pictures in posts are far more valuable than a plain text update. If you can use a LOLCAT in your marketing or with your product, you’re golden. GM’s best FB tactic would be to poster their new cars in LOLCATs and put them on FB. They would get instant 500 Million “likes”. People fucking love cats.
Other stupid basic psychology, posting a pic with some text resulted in X number of “likes” and shares. A month later posting the EXACT same pic and text along with “Please share if you like this post” resulted in 10x the number of shares. People are really that checked out when using FB. A simple request results in high compliance. The Psychology of Facebook would be an interesting read.
I have bashed FB in several posts. I felt it was time to give them credit where it’s due. FB ads are very effective for the right niche. The problem with the IPO is that few people understand that niche and how to put a valuation on it.
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Good post.
Very informative.
“This is why you see LIKE buttons on every web page and at many local businesses. Look around, you’ll see LIKE logos/buttons are everywhere.”
Please pardon my ignorance; but how exactly do FB makes money from this “Like” button scenario?
There are LIKEs and becoming a FAN. Basically FB is so f’ing retarded it makes a grown man sound like I’m a Justin Beiber groupie when I try to explain it but….you would become a fan of a product, celebrity or company web page and you would LIKE an event, post, picture etc.
Both of these events seem innocuous, but that’s how it all starts. Becoming a FAN is like signing up for a newsletter. “Liking” a post is the equivalent of forwarding that newsletter to your friends.
FB doesn’t make money when someone likes something, but when a LIKE happens it becomes part of the user’s feed and their friends see it. The ripple effect can be huge if it becomes popular and the impact measurable if there is a call to action (purchase etc)
Think of a LIKE as a soft/subliminal personal referral to look at something. You are much more likely to look at something I send you via email than a SPAM message.
So basically a business can take advantage of the working mechanism of FB without having to pay FB a dime?
Am I correct in my understanding that FB is a valuable tool that is free to all users?
If you search for something on Google the results are called organic search. There is a whole industry built around making your company show up on the first page for your business’ desired search words. In that respect, Google is a free tool available to all users.
The results along the right side of your search are paid ads. Those companies “bought” the ad for the words you searched for, sometimes for up to $15 per click. (An important distinction, GOOG only charges the advertiser if the user clicks on the ad)
On FB, you could build a page for your business and grow it organically. But just like Google, that path requires time and expertise to get Fans/Likes/Clicks.
Or you can pay FB for ads based on certain user demographics.
In that respect GOOG and FB are similar…but GOOG is so much more. I’ll post more about GOOG soon.
I started to “like” FB….now not so much. It is just a stream of what other people are doing. Now I do see some advantage in promoting yourself or product when you can get the eyeballs. I would love a dislike button….that would be awesome! Imagine if you really really disliked a service, or product and you could take away some of the “likes” bet airlines, banks and DMV employees might try harder to find solutions to your problems…just saying.