Facebook now has 300 million users and became cash-flow positive last quarter, perhaps a year ahead of projections, according to the Facebook blog.
Suddenly, say pundits like Alex Salkever of DailyFinance, Google should consider throwing in the towel.
That’s because 80 percent of brands are now advertising on Facebook, and the ads are better- targeted and more cost-effective than Google pitches, which can’t go viral like Facebook ads, Salkever explains.
Missing in this glowing he-drank-the-Kool-Aid report about Facebook’s ad business is the oft-heard caution that most Facebook users regard the site as a place to share information, apps and images with friends, family and colleagues and resent the intrusion of e-commerce.
And, if 80 percent of brands are now advertising on Facebook, I guess I’ve missed them.
My Facebook page today has one advertisement, and it’s a display ad from All Nippon Airways.Â
The ad beckons:
“Want sumo, Harajuku or Mt. Fuji? Well Japan’s the place! Let ANA take you there in comfort and style. Click here for our lowest fares.”Â
One Facebook-ish thing about the ad is users can indicate whether they “like” the ad or not … potentially giving the ad the aforementioned viral send-off. However, I note that you can’t comment about the ad as you can when you indicate whether you like a Facebook friend’s status update. So, the absence of commenting provides a little brand protection, I guess.
On the ANA ad’s landing page, there is a booking engine, and everything from promotions for the ANA Mileage Club and the Star Alliance to a pre-boarding guide.
However, Facebook’s supposed super-targeting abilities are a bit off, in my case. I have never traveled to Japan, and while I would like to someday, such a trip is not on my agenda.
All I’m saying is that Facebook may eventually become an effective advertising platform and it could even challenge Google one day because we all know that industry leaders can’t retain their perches forever.
But, let’s hold off on annointing Facebook as the Google-killer for now.
I think Google will continue to attract a few ads from travel companies and a few other brands for the time being.
Facebook ads = interruption marketing
Google ads = permission marketing
If I google “flights to Japan” and get an ad from ANA offering exactly that, I’m happy to be pitched to. I’m in market afterall. By searching for something I’m essentially giving my permission to be advertised to, just as long as those advertisements help me find what I’m looking for.
If I’m on Facebook and get pitched brands based on my demographics (or anything else in my profile), then I’m being interrupted. Just because I’n a 20-something male doesn’t mean I want to see a beer ad (and click on it!) while I’m in the midst of writing on my friend’s wall. That doesn’t make sense.
For People Search… FaceBook
For Real-Time Search… Twitter
For regular Search… Google
… and possibly for geeky, nerdy, academic search … Wolfram|Alpha
But there are a few exceptions to this…
- On the one hand more and more people are crowd sourcing their questions and searches on FaceBook, Twitter of Vark.com. “Anyone know where I can find x? or what the best website for y is?”
This however is more likely to impact organic results than paid ads… can’t see much impact on ad revenue here.
- On the other hand, Google is tackling FaceBook through other means as well. It appears to me that SideWiki is another small step towards Google’s quest to create the Google Social Network out of the world wide web as a whole… we already have messaging, email, voice, profiles, pages, toolbars, collaborative apps… and now we can comment and share views on any site (in a reverse way to how we share and comment on FaceBook) … and as of tomorrow we’ll start seeing people surfing the new Google Wave…
So.. evidently.. FaceBook is not the Google Killer… at least not yet…
Anyone who thinks Facebook will “kill” Google in the near to mid-term is delusional. Google’s web search is now only one aspect of a company that is incredibly well positioned for the future.
A quick rundown of the mega-weapons in Google’s arsenal:
Search – It’s not just huge, but now its getting personal and positioning itself to drive the Semantic Web.
YouTube – the world’s second largest search engine.
Wave – Launches tomorrow, a game changer disguised as a real-time, interactive messaging and content management platform.
Docs – Virtual desktops are making inroads into organizations.
Maps – Location based services platform.
Android – mobile operating system
Chrome – web browser
Labs – Too much stuff getting developed to even scratch the surface here.
Profile – The Google Profile links all the Google properties together providing an unparalleled view of user preferences and processes.
Ad Network – Adsense + Adwords + DoubleClick = advertising enables across all platforms.
Code – Tools and API’s for the do-it-yourself developers of mashed-up applications.
Facebook is a great platform that will be strengthened significantly by the integration of FriendFeed. There is little doubt Orkut will never usurp Facebook’s dominance as a social network, but from an advertising perspective, but at this point, Google sure looks like they have Facebook surrounded.
Dennis –
to be very specific conversion on facebook ads is 5 times LESS than on Google SEM. (i.e. for 100 clicks, Google gives you 5 bookings and facebook 1). This is a benchmark from us and other companies. I think the article meant 80% of brands have “tested” facebook ads…
I think there can be niches of better positioned products, and it certainly helps videos/pics to go viral – but it’s far from being an advertising machine like G.
I’m not sure how Facebook’s targeting facilities would help ANA in that case. They’d be better talking to trip advisor to get in on their facebook app.
If you have products that match demographics (e.g. adventure holidays for young single travelers), facebook might be able to help because that demographic information is part of the facebook profile. But there is no profile setting for “I’d like to go to XXXXX some day” (something the aforementioned “Cities I’ve Visited” app should add).
I agree with Jeff that generic demographics are not as good as offering that add to someone who is actually interested in Japan, but effectiveness surely varies depending on the product.
Also, whatever happened to Orkut? They acquired that to move into social network space, and I used it to a point (but my Portuguese is awful). I know it is still there, but Google don’t even list it on their “More” or “Even More” pages. Surely being positioned to do both social networks AND search places Google in a superior position to Facebook.