Facebook For Business: The Right Approach

What is Facebook worth? The company’s high profile IPO in May 2012 gave the social network a total value of $104bn, with an individual share price of $38. But what direction is it heading? And what are the right methods businesses can use it to appropriately engage with consumers?

The chief operating officer of Facebook, Sheryl Sandberg, stated prior to the company’s IPO that the long-term aim for Facebook is to emerge as the number one stage for online advertising, catering to the approximately 70 million global businesses. The big question on the lips of many people however is where will the revenue come from? There seems to be an attitude towards Facebook’s main current revenue stream, advertising which suggests that both businesses and regular users of Facebook are sceptical of the ability of paid adverts to effectively target consumers without damaging it’s brand (especially considering the poor click-though rates of banner ads).

This apparent ineffectiveness of Facebook’s paid advertising capability was summed up earlier this year when the news that General Motors would be removing its own adverts from the social network, citing them as having “little impact on consumers”. However, the fact that the automobile giant is still investing approximately $40 million a year on pure content generation for Facebook hints at where the advantages and limitations of Facebook for business lie.

It seems that the trends surrounding investments in Facebook illustrate how different the social media platform is in comparison to traditional formats of advertising. People get bored and frustrated at one dimensional, characterless adverts taking up valuable space on their news feeds, and therefore try their upmost to avoid them.

Creating interest and interactivity for consumers is seemingly the way to go. There are countless ways that organisations can compose fun, engaging online activities which customers can get involved with. An element of loyalty can also be developed via the use of ‘point systems’ where businesses can reward customers who are especially involved. Taking all of this new information in is increasingly important for companies, especially when seeking to know how these new elements of interaction can be improved. ‘Facebook Insights’ is a tool that Facebook have developed to allow businesses to do exactly this. Companies on the network can, for example see what status updates performed the best and what exact content had the most responses.

It is pretty obvious that the most successful Facebook campaigns are ones that are focussed around innovative content creation, not spending on tedious and irritating adverts. The fact that Facebook is a socially active, interesting place must be both remembered and applied by organisations to their respective online marketing campaigns, in order to achieve a higher level of success.

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