What's the Big Deal About Facebook?

By now, you’ve at least heard about The Facebook. Mark Zuckerberg, creater and CEO of Facebook, has been a very present name in the news lately as he is opening up Facebook to advertisers. Facebook is part of the growing social media genre, and works much like MySpace. A person can create a profile, add friends, join networks, write (speak) freely about whatever they want, add widgets, send out mass invitations, have newsfeeds, and post pictures, just to name a few.

Facebook has amassed 50 million members who constantly carry on conversations about activities, parties, milestones, etc. The trick is to get them talking about your brand. Go to any Blog, Facebook, or MySpace Page and you’re almost guaranteed to see a person’s like or dis-like for a particular product, restaurant, or vacation destination. You should not underestimate the power of a trusted recommendation from a friend or some one in your network.

For example, if I were to post on my Facebook Profile about an exceptionally fantastic vacation I had at a particular resort, the people in my network who regularly read my Blog and who trust me as an individual, are more likely to at least look into visiting the same vacation destination than if they were just handed a brochure or were just browsing the internet. The Facebook’s “new” advertising model works to exploit this phenomenon of mouth-to-mouth, consumer-to-consumer advertising.

There are three parts to Facebook’s ad plan. The first part of the plan is users initiate product recommendations. Once a user interacts with a brand, it will be broadcast to their networks through their news feeds and mini feeds. Like bands do on MySpace, brands are encouraged to build a page, or profile as Facebook calls it, so users can become “friends” with the brand and write on the brand’s wall.

Part 2 of the Facebook ad plan is for advertisers to buy highly targeted advertising. Users volunteer information on their profiles, like their age, where they work, where they live, what books they read, and movies they watch, all things that are helpful to marketers to narrow down a target audience and target ads toward them. The paid-for ads run in news feeds and can be bought on a cost-per-click or cost-per-thousand basis. Ads can include a short amount of test as well as an optional graphic.

The 3rd part of the ad plan is on the Facebook side and entails combining user interaction and paid-for advertising to create socialads. For example, the news feed, “Brian is a fan of Gatorade” could be accompanied by a Gatorade ad. Like regular paid ads, these socialads are frequency capped so users see a maximum of two per day.

See more about Facebook’s marketing plan in Abbey Klassen’s article in Advertising Age entitled, “Real revolution isn’t Facebook’s ad plan,” from the November 12, 2007 edition.