Facebook: Not an ad platform but an ecosystem
Now that Facebook is a publicly traded company with shareholders to satisfy, the ongoing question of whether it will ever live up to its promise as an advertising platform becomes more urgent.
While display advertising does account for approximately 80 percent of Facebook revenue, and advertisers continue to add Facebook to their online media plans, marketers and commentators are divided on its efficacy. For example, in the run-up to the Facebook IPO, General Motors announced that they were discontinuing display advertising on Facebook, while in the wake of that announcement, both Ford and Coca-Cola separately expressed their intentions to continue to use the platform.
But in assessing the value of Facebook to advertisers, to focus narrowly on the impact of Facebook display may well be missing the point. The real power of Facebook is realized when it is viewed and utilized not just as another display channel but as a rich social ecosystem that provides unparalleled opportunities for consumer engagement. Advertisers that understand the nuances of this system can deploy fan pages, Facebook display advertising, and other marketing channels to great synergistic effect.