Posted June 23, 2009 5:25 pm by with 4 comments

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I know you’re tired of hearing the same old “the economy is going down the tubes” sob story, so I brought you something different today—a company that’s actually increasing its advertiser base. And not just any company—a social media company (and you know how tough it is to really make money there—you know, other thank from VCs).

facebook-logoFacebook has tripled its advertiser base in the last year. Yes, tripled. Bloomberg reports on the uptick (comparing it to Google’s first sequential drop in quarterly sales last quarter), speaking with Tim Kendall, Facebook’s director of product marketing for monetization.

In case you’re wondering, the specific advertising product that’s garnered so much popularity was first unveiled in 2007. Bloomberg describes it thusly:

The automated ad system . . . lets companies make small edits to their ads during campaigns and suggests words for advertisers to target users. The ads, which appear on users’ Facebook home pages, allow 25 characters in the title and as many as 135 characters in the body of the text and an optional photo.

And it turns out that Facebook is employing a revolutionary idea to get these and other ad formats (such as their “Engagement ads”) out there.

Wait for it.

Wait for it.

A sales staff. I know, seriously, can you believe it?! Aside from selling advertising inventory, this staff also:

The company also has been helping advertisers target users when they become fans of certain products or brands. Users can visit fan pages where they learn more about the products and connect with others.

And if their advertiser base has tripled YOY, it sounds like they’re doing their job—especially in light of recent reports of rampant click fraud on the social network’s ads.

eMarket Analyst Debra Aho Williamson told Bloomberg, “Everything is starting to solidify for [Facebook]. They’re definitely getting the hang of it.”

What do you think—is Facebook hitting its stride or does it have a long way to go to catch up?

  • It’s a shame that Facebook advertising is still such a pain to use!

  • Facebook advertising is really a painful OUCH!!

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  • I’m not surprised that Facebook is doing well. Their advertising is built on the same model that Google’s is built on – monetizing information. When I have an ad every Wednesday for So You Think You Can Dance, every Sunday for Burn Notice, and corporate training companies can target me as a sales manager, it seems pretty obvious that the advertising is exceptionally targeted. Adwords didn’t work too terribly well at first either – but Google fixed & evolved it.

    My prediction is that Facebook becomes highly profitable.

  • Traditional (e.g., banner ads) on Facebook are still problematic because of the low click-through rate. As marketers we’re getting around that by sticking to the PPC models so we aren’t laying out too much money. But that doesn’t give a large income stream to Facebook. On the other hand, setting up fan pages, etc. on Facebook, which does have marketing potential, doesn’t really add much to Facebook’s revenue model.

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