Facebook attracting big advertisers

11 August 2009

PALO ALTO, California: Over 80% of the biggest advertisers in the US are now using Facebook as a means to connect with consumers, a sign that the social networking platform may soon be set to capitalise on its substantial user base.

Many marketers have proved keen to utilise the increasingly broad array of social media platforms at their disposal, and thus mirror the activity of a growing number of their potential customers.

However, it is also observable that a "best practice" approach for this fast-developing medium has been slow to emerge, as the industry grapples with emerging trends and behaviour in this area.

A recent report by the Altimeter Group stated that Starbucks, the coffee house chain, and Dell, the computer manufacturer, have made the most effective use of sites like MySpace and Twitter thus far.

Facebook has now reported that 83 of the top 100 companies by adspend in America, as determined by AdAge, have a presence on its portal, which has around 340 million members worldwide.

Much of the marketing activity on its site has moved beyond traditional display and banner advertising, demonstrating that there are a range of different strategies available.

Brand "fan pages" are one of most popular avenues, with two prominent examples being those for Starbucks, which has 3.7 million "fans", and Coca-Cola, which has 3.5 million followers.

Similarly, a number of advertisers have developed "applications" which can be downloaded by Facebook members, and added to their profile page.

Unilever and Starbucks used such a device to promote their jointly-produced ice cream, while Kraft donated six meals to the not-for-profit organisation Feeding Americaeach time its "app" was downloaded.

Ed Montes, US managing director of Havas Digital, said that "every client wants to talk about Facebook. I haven't seen this kind of consistent fervour for a company since Google."

"Facebook is trying to build a platform where consumers and marketers can interact in innovative ways. The personalised consumer relationships that you can develop on Facebook are the future of online marketing."

Sheryl Sandberg, Facebook's coo, added that "if you look at people's profile pages, you'll see a lot of commercial activity, even without advertising."

She said the company does not intend to change its policy of allowing brands to use apps and fan pages for free, but instead hopes the success of these strategies will increase interest in paid-for ads.

The Palo Alto-based property has recently developed a range of new options for brands, as it seeks to drive up ad revenues, which eMarketer predicts will reach $230 million (€162m; £139m) in the US this year.

Data sourced from Financial Times; additional content by WARC staff