Tag Archives: Facebook

Facebook Focuses Hard(er) on Small Business

Facebook is felt by some to have the potential to dominate SMB online advertising because of its incredibly high organic usage. But the challenge to drive even more SMB advertisers remains. The company currently reports that it has 40 million SMBs with Facebook pages around the world. Two million SMBs are paid advertisers, or five percent of its SMB page holders.

Today, Facebook unveiled several new small business support programs that it hopes will boost its SMB conversion rates. These include a series of local SMB events, the launch of self serve tools and chat and email support.

We got a hint of what was to come during the March 25 keynote by Facebook Director of Small Business Jon Czaja at BIA/Kelsey National in Dallas. During his keynote, Czaja emphasized that Facebook can lift sales results for SMBs by a high percentage if it is added to traditional media ad campaigns.

He also asserted that Facebook does well on its own. He noted that Facebook’s accuracy for narrowly targeted online campaigns is 89 percent, or more than twice as high as the industry’s 38 percent average. Advertising on Facebook provides $8 back for every dollar invested, and a 12x boost in conversion, Czaja suggested.

While Facebook heavily emphasizes self serve for SMBs because they demand it, it is also eager to partner with agencies and others, adds Czaja. “Facebook can’t build everything itself. If there are other partners out there to build on our platform and encourage better performance, then advertisers will be able to choose to go to Facebook or an agency. It’s an ‘All-of-the-Above’ strategy.”

Facebook Goes Up Against Craigslist and eBay (Sort of)

Craigslist has outlasted its challengers, and remains the platform to beat for classifieds, or “things to sell” marketplaces. eBay, similarly, remains a leader for the sale of goods – although most are not geographically oriented. Amazon is also active in that space.

Can Facebook, with its huge volume and trust networks, cut into their business? It is going to try via a new “For Sale” offering that allow users of its groups to post items for sale. Items are listed with prices, photos, descriptions, pick-up location and prices. They can also be listed as “available” or “sold” to let buyers know what’s still on the market.

The listings are currently free – and probably won’t go into the paid areas that provide the bulk of Craigslist’s revenue: apartments, cars, jobs and “personal services.” But if Facebook decides to provide a greater emphasis on classifieds, it could conceivably move into transactions (and commissions). It could also open the service up beyond its groups to have more of a geo-orientation.

It isn’t the first time that Facebook has been used for classifieds. Oodle, a large classifieds platform that launched in 2005, took over a nascent Facebook classifieds service in 2008 and focused on Facebook’s huge scale to offer items for sale to friends and groups within the service. Oodle was sold to QVC several years ago.

It also isn’t the first time that online groups have been used for classifieds. In their heydays, Yahoo Groups and Big Tent – each with hundreds of thousands of users — had active lists of classifieds. Many associations and groups currently host classifieds on their websites and pages.

The classifieds project is the latest transaction-oriented effort from Facebook, which may want to diversify its revenue beyond advertising. Facebook has been experimenting with various transaction models for several years, including tests with virtual gift cards, deals and virtual currencies. Facebook has also developed an Amazon-like capability to enable transactions on other sites by collecting credit card information on its profiles.

Facebook’s Joe Devoy, BIA/Kelsey New Orleans: ‘Pairing Advertising, Sales Data’

Facebook announced today an ambitious program to match sales related data from a variety of sources to show ROI. Speaking at BIA/Kelsey’s Leading in Local: SMB Digital Marketing event in New Orleans, Product Marketing Manager Joe Devoy noted that the program reaches out to Facebook users for feedback because sales results cannot really be ascertained from click thrus. The program is being tested with national advertisers, but is clearly aimed at SMBs, who make up the vast majority of Facebook’s 1.5 million advertisers.

“Within local, our misision is to create the most relevant ads for people on the platform, says Devoy. But “Measuring offline sales has always been difficult,” says Devoy. “Clicks don’t have an impact on the performance of the campaign.” Ninety- nine percent of people who saw an ad on Facebook and later went into the store never click on an ad.

The program’s ad exposure helps tremendously. There is a 70 percent higher ROI from campaigns that maximize reach, and an 8X return on ad spend, says Devoy. At the end of the day, “Facebook reaches the majority of consumers. We can reach any vertical,” he says.

A Look at Facebook’s ‘Buy Button’ for SMBs

Facebook hasn’t really been a player in ecommerce –Facebook Credits, its games-oriented initiative, was shut down in 2012 after three years of experimentation with virtual currencies. But it continues to test the waters — which is not surprising, given its volume and huge edge in social media and native advertising.

Last year, Facebook began to allow consumers to add credit card information to profiles in order to enable ecommerce transactions. Now, Facebook says it is testing a “Buy Button” with “some” SMBs.

During the test, consumers are providing Facebook with credit/debit card info for PayPal-like purchases on a one-time-only basis. Neither the SMB or Facebook ever get to see the info – all payments are being handled by a third party processor. Consumers could then opt to allow Facebook to make the credit/debit card info part of their permanent profile, using the cards for convenience.

If Facebook expands the effort – which Reuters reports is currently free for merchants — the implications could be significant. For starters, Facebook’s enhancement of its anonymous consumer profile would put Facebook on a collision with Amazon and its one-click purchase system. By focusing on the under-served SMB market for ecommerce – and likely offering a blend of virtual and physical goods — Facebook would also be breaking new ground.

Facebook’s Joseph Devoy is discussing a wide range of SMB initiatives at Leading in Local: SMB Digital Marketing Sept. 22-24. You can register here.

IAB Leadership Meeting: Facebook, NY Times Defend Native Advertising

Native advertising — the insertion of contextually relevant advertising amidst other content — is viewed with suspicion by much of the ad community, which sees it as unscaleable, and perhaps the opposite of its drive towards programmatic (automated) sales.

During the Summary Panel today at the IAB’s Annual Leadership Meeting in Palm Desert, one hypothesis by moderator Terry Kawaja, CEO, LUMA Partners, playing devil’s advocate, was that “agencies cannot create the volume and quality of native content necessary to populate every native ad.”

New York Times Executive VP of Advertising Meredith Levien, rising to the bait, strongly disagreed. “Good native advertising puts the onus on the reader to decide whether to engage or not,” she said, noting that The Times, Buzzfeed, Forbes (her former employer) and others have set up native ad areas that are clearly differentiated from other content, and highly successful. “It’s not like we have (columnist) Thomas Friedman writing for Pepsi,” she said.

Facebook VP of Ad Products, Monetization and Atlas Brian Boland, a keynoter at BIA/Kelsey’s ILM show in December, vigorously defended native advertising – not surprisingly, since Facebook is banking heavily on it. Native advertising, when combined with personalization, provides unprecedented value, he said. “People are going to a place where they want to discover what is important to them. It creates an opportunity for people to be excited about what they see.”

Boland noted that Facebook has recently been criticized for pushing the envelope with native advertising by having video ads. But critics should have done their homework, like Facebook has, Boland said. He noted that it did reams of testing and research, and the feedback has shown that the video ads are totally engaging viewers.

Going forward, Facebook is developing a set of formats to enable people and advertisers to express themselves via native advertising on every platform – especially mobile. Boland acknowledged, however, that such formats are better suited towards larger media concerns. A handful of publishers will similarly see how things evolve, he said. But it remains “a challenge for midsized publishers.”

LSA 2013: Facebook’s Dan Levy on Importance of Local

“Local search is really important for Facebook,” with a major boom in local business adoption, and the synonymous nature of mobile usage and local search, notes Facebook’s Dan Levy, who spoke April 16 at The Local Search Association conference in Las Vegas. Levy says there are 15 million SMBs on Facebook now, and 680 million monthly mobile users.

“The best way to judge Facebook is to look at where we are spending our efforts,” adds Levy. While Levy concedes that Facebook’s changing lineup of ad products may be hard to keep track of, the current lineup of ”Promoted Posts,” “Nearby” and “Graph Search” are “a real testament” to Facebook’s commitment to local, he says.

What Facebook is ultimately shooting for are products that best leverage Word of Mouth, says Levy. “Getting a recommendation via word of mouth is very important. We are building that into our ad products.” It also doesn’t mean reinventing the wheel. “Social advertising isn’t a new industry,” he suggests. “It is just advertising that is social.”

Promoted Posts are seen as a success for Facebook because it has been picked up so quickly. A million businesses have used a promoted post in less than half a year, and they have kept using it. The product has a 75 percent retention rate.

What doesn’t work for Facebook is when value isn’t being added. Deals didn’t work so well because they didn’t provide many unique values. But a new product, Offers are a homegrown success story, with “70 percent of users connected to at least one local business,” says Levy. More importantly, offers quickly go viral. Most offers aren’t being claimed by the original audience, but by friends of fans, says Levy.

Converting Facebook SMB Pages to Websites

Various companies have built SMB websites and landing pages by scraping the Web. PaperG comes to mind. How about using Facebook. BIA/Kelsey data from our Local Commerce Monitor shows that more than 40 percent of U.S. SMBs have Facebook pages. Many, however, still don’t have standalone websites.

Exai, a spin off of TrafficMedia, is pursuing this path with a freemium model. Companies can opt to have a free, custom-created, mobile-optimized site based on their Facebook page, but can also upgrade to an enhanced version for $3-6 a month. The enhanced version includes maps, Google indexing and other features.

TrafficMedia was originally based on the idea of custom created sites that don’t use a template. Exai’s concept theoretically makes website building even easier by populating the content for the SMB.

The businesses are recruited via targeted Facebook ads. Most of the SMBs are outside of the U.S. and Western Europe , where Facebook’s advertising rates are less affordable for startups. They largely come from the Middle East, North Africa, The Far East and Asia. The company is also building via word of mouth, including a contest it is hosting for best website built from Facebook content.

Founder Gal Moran, a serial entrepreneur, says the company is currently focused on Facebook, but will soon also scrape other social media sites, such as LinkedIn. Facebook’s appeal is that it is universally used by a high percentage of SMBs. The company currently has built 10,000 SMB sites from Facebook, and is adding 1,000 + new sites a day.

Moran adds that Facebook has been very helpful , even sending staffers from Ireland to help facilitate things (living up to a promise made by Facebook exec Dan Levy at ILM West to help third party sites work with it). Exai has also gotten support from Google, which is able to leverage Exai for its ability to index Facebook-only content that previously was only available to Microsoft Bing.

Do Facebook SMB pages generally have enough content to make a compelling SMB website? It is a good question. It probably varies. At the very least, they provide a head start for the majority of SMBs that aren’t self-starters.