Posted November 2, 2011 12:35 pm by with 2 comments

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US Social Media Network ad revenues are expected to surpass $3.90 billion in 2012 and a large portion of that money is going straight to Facebook.

New numbers from eMarketer show that Facebook will likely earn 72% of social media specific ad spending next year.  That’s equal to 7.9% of total online ad spending.

Sounds good to me, but the Wall Street Journal says Facebook is still struggling. They point to a recent Ford Focus campaign that pulled in 43,000 “likes.” Ford spent more than $95 million to advertise their new car, but very little of it went to Facebook.

To add insult to injury, Ford turned down a suggested sponsored stories buy on Facebook, then paid Yahoo and Microsoft to send traffic to the Facebook page. According to WSJ, Ford did eventually spring for an ad but stopped it long before it stopped those on competing sites.

Ford’s biggest Facebook related expense? Probably paying the agency who created the campaign page and the videos that went viral.

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Right now, Facebook’s ad buyers are mostly small companies and websites. In order to lure in the big brands, they may have to start offering bigger spaces – like home page takeovers and ads that make a statement.

Then there’s the whole “free fan page” thing. Facebook says that free is just the start. That it’s a combination of free page with paid display ads that spell success. But what is success on Facebook?

Says Scott Kelly of Ford marketing,

“You can give them money, and they can give you Likes, but the question is, what is the value of those Likes?”

It’s a question we’re all still asking and one that is keeping big companies like Ford from dropping too many dollars on Facebook.

So which is it? Is Facebook’s ad revenue a win or a lose? Like all things Facebook, it’s kind of hard to say for sure.

  • DugPath

    The amount of money involved here is pretty ridiculous and its only going to go up as a lot of businesses continue to build up around Facebook. A lot of developers, ad agencies, video producers, marketing firms (see for dozens of examples of these companies), and others are really sort of coalescing around Facebook and creating this ecosystem totally based around Facebook. Right now Facebook is set up to dominate this industry and this is why Google is pushing so hard to get Google+ on the right track: I just think they’re a little too late for this. Big companies like Ford can obviously afford to pay some sort of big fee to get an ad plastered on Facebook’s background or something, but I think that this cheapens the brand and Facebook will be really cautious about this despite the extra revenue it can bring in. That would remind people too much of MySpace so they’re not going to go down that path. Facebook definitely has a much stronger design presence than MySpace ever did and is run much more competently.

  • What is the value of those “likes” ? Is this guy kidding??? Lets say you paid 1 million in advertising dollars that yielded 1 million likes, because a like gives you access to the liker’s (for lack of a better term) wall, in affect the liker is advertising to his friends for you, and lets say that each like has a average of 10 friends, wow if my math is correct that is a advertising scope of 10 million. Now here is the real value (as if the foregoing is not enough) once you have the likes they are yours so basically you can now advertise to 10 million people anytime you like for free! how much are you paying now for that market reach??? Stupid!