(Photo credit: Wikipedia)
In the weeks since Facebook’s IPO, the Zuckerberg-lead social network has been under intense scrutiny, with many expressing doubts as to the financial viability of Facebook’s revenue model, especially with regard to its advertising service. GM pulled their Facebook marketing campaign, and music industry e-commerce startup Limited Run made an impact with their claim that 80% of the clicks for their Facebook ads were made by bots (although the jury is still out on the accuracy of that complaint). A study from the Advertising Research Council claimed that “blank” ads with no content were performing only 0.1% less well than regular ads.
While this news is not good for Facebook’s future revenue, and businesses should think hard before spending their advertising budgets on Facebook’s paid ad platform, the real value of Facebook and social media generally was never through paid ads anyway. The true virtue of social media is not that it increases short-term conversion rates, but that it allows brands to build engagement and foster a community that can have a significant impact on revenue over the medium and long term. In this area, the future of Facebook is much more robust, and the indications are that social media proper, rather than paid ads on social media, are an excellent target for marketers.
