Posted September 2, 2009 12:23 pm by with 14 comments

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Facebook IconFacebook has a lot going for it lately. They’ve got more than 250M users worldwide, they’re the most popular social network in almost every country in the world, they’re hiring in a down economy, and according to a new comScore report, 8.2% of all Internet ads are served on their site.

But, then, maybe this all makes sense. Since Facebook is so popular, it’s not entirely surprising that they serve one out of every twelve online ads. Even better? At least some proportion of their on-site CPC ads lead to another page on the site—so they’re getting money and traffic.

This isn’t a recent development, of course—we’ve all seen ads to “Become a Fan” of something on Facebook. But as smart as it sounds to make your advertisers pay for generating traffic to your site, the underlying logic is pretty much a stroke of genius:

Facebook is an Internet unto itself.

Facebook has long been accused of being a “walled garden”—with its fan pages, apps and other utilities, FB is almost a subset of the offerings of the Internet. If your brand is prominent enough, you’re on Facebook (or you should be!). Driving paid traffic from a personal page (personal) to a branded page only makes sense on that kind of paradigm.

Of course, that kind of advertising is good for advertisers, too, or they wouldn’t do it. JCPenney went from 22,000 fans to 500,000 fans with these advertisements in the run-up to back-to-school shopping (though Bloomberg didn’t say if JCP saw increased revenue from this).

And something seems to be working for FB, too. Last month, Bloomberg said the most popular social network in the world should post at least $500 million in revenue this year.

What do you think? Is Facebook a subset of the Internet, and is internal paid advertising a natural extension of that mentality? Can Facebook sustain this kind of revenue?

  • Personally I think Facebook is overyhyped and in all honesty can see it going the way of myspace…..unless of course they keep shaking things up and building relationships with other major web properties e.g. twitter……and more interestingly amazon….

  • I had never thought of it this way. I wonder if this could be the way Twitter and YouTube could monetize…and increase their own traffic , as well. Instead of “the Internet”, we might have “the Internets”.
    .-= David Leonhardt´s last blog ..Look who follows NoFollow links! =-.

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  • I totally disagree with Broadband. Facebook is easy enough and shakes things up enough to stay the frontrunner. A lot of people today use the Internet just for social purposes and, mostly Facebook. So therefore, I do think Facebook is an Internet unto itself.

  • I think you’re right on. There are so many people hanging out on FB and in my opinion it is the “bomb” of all the social networks. You can really reach out and connect with people there. I like Twitter for the small conversations but FB rocks for really getting to know someone.

  • Iv never really got on with facebook, find it really hard to navigate and have problems loading the page.

  • Couldn’t agree more. I personally know of 8 (non-marketing) friends that gave up on email because their FB reach was strong enough to deliver their messages. Now these where normal average users of email, FB and the internet in general. Not power users like us. I was shocked when I kept hearing over and over, “I don’t check my email much anymore. Why should I, my friends are on FB?”

    Take a step back and think about how many of your emails are to clients and friends. You might be shocked yourself to see the ratio has greatly diminished over the past year.
    .-= Jaan Kanellis´s last blog ..Bing Shows You Who Is On Your Shared IP =-.

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  • i liked Facebook back when it was small, and i like it now, when it’s big (and going to keep getting bigger/more important)

  • The term ‘subset’ is so vageue. Well, if Facebook is a subset of the internet, so is MySpace, so is my little blog. It doesn’t actually mean everything.

    And as for the Facebook craze, there is no data-locking exactly happening in any social network, except for your friends. For myself, yes, I have been using Facebook more regularly in the past couple of months than before. That’s because I just moved and I have all my new friends of the past year on Facebook. I am not in as much touch with the older friends and hence I am no longer active on orkut..

    For true online social networking, I still see the Instant Messengers as the key…
    .-= Anand´s last blog ..Skype Usage Facts You Didn’t Know =-.

  • I second Jaan, a shocking number of my friends also just don’t even check their e-mail exactly because they can use Facebook for quicker and easier communication. You even know when somebody has got in touch because you get a helpful red notification! Whilst Facebook could go the same way as Myspace, as Broadband said, it doesn’t look that way at the moment at least.
    .-= Luci´s last blog ..Images And Videos To Support A Variety Of Content And Your SEO. =-.

  • Facebook was more enjoyable in the beginning when you could actually keep track of friends. Now my daily feed is full of self promoting bloggers, companies and other ads. I still use it but only to look at photos.

  • Some people use facebook to keep in touch with their families, relatives, and friends. So far facebook is an effective social network as well as a media to build connections among people through their data and stories. Perhaps, facebook is still the famous social media until there is another better one which can replace it. Either a local media or world wide media, people need a tool to get to know each other activities.
    .-= Dion´s last blog ..Sang Pemimpi =-.

  • I think the main problem with any social networking sites is the ads, everywhere you look on these sites there seems to be adverts, even to the extent of clicking on one by accident.

    I would like to see more sites which are more easier to work with, less adverts and geared towards the consumer rather than profits.