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Facebook’s Real Problem in Just 44 Words

There is a lot talk about Facebook. The billionaires, the millionaires, the speculation, the complaining, the changes. You name it, the list goes on.

Of everything I have read, one quote summarizes it all from Wall Street Journal article. It comes from Veronica Stecker the media manager for Omaha, NE based retailer Gordmans. Simply put in just 44 words (or 255 characters including spaces according to Word’s word count function).

We still don’t have a huge correlation between Facebook fans and return on investment in an actual sales in store. Until that metric becomes a lot more solid, I don’t think our company or other brands are going to be full-fledged into Facebook advertising.

Agree? Disagree? Have an opinion? How will this observation impact Facebook as it tries to own the world?

Have a great weekend.

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  • http://www.alertpresence.com Brett Pollard

    Seriously? It’s hard to believe they haven’t figured it out yet. I continue to be amazed by retailers who think you can’t track the results of social media campaigns while they continue to dump money into advertising that truly can’t be measured (billboards, print ads, etc.).

  • http://1localbusiness.com Chris

    Ha!

    Yeah – and it’s my fishing pole’s fault I don’t limit out every time!

    The age old problem with any mktg/adv is tracking. Is Gordman’s looking for another media manager?

  • http://www.frankthinking.com Frank Reed

    @Brett – Maybe you need to tell them the secrets? Is it really that easy to draw a direct correlation from Facebook to sales? It seems to be the thing most have the most concern about regarding social media so somebody is missing something here!

  • http://www.frankthinking.com Frank Reed

    Remember we’re talking about IN STORE sales here …….

  • http://1localbusiness.com Chris

    Wait – is Ms Stecker talking strictly about Facebook Ads or Facebook in general?

    Not that my opinion changes, but it’s a somewhat less shocking proposition.

  • http://www.frankthinking.com Frank Reed

    Everyone should (as always) read the full article at the WSJ for more context. It talks to the fact that Facebook is forcing advertisers to pay because the free aspect of seeing updates in FB news feeds is very diluted. Most people aren’t paying attention anyway if some studies are to be believed.

    Phew the Kool Aid is strong coming from FB HQ ……….

  • http://letter.ly/startupdailydigest Jim Shook

    I’m not sure it would be that easy to get a correlation between Google Adwords and “in-store” sales either, but I think they’re doing OK :) Once Fbook figures out how to offer mobile ads and Groupon-like deal based ads properly, offline sales will certainly correlate more I think.

    letter.ly/startupdailydigest

  • Jeff C

    I personally know of no one on Facebook that has shared a product or claimed to have purchased a product via finding it on Facebook. People go to Facebook to see what people are doing or tell other people what they are doing, not to go shopping.

    As an ECommerce Consultant, we tried numerous Facebook ads and the ROI pailed in comparison to Google Adwords even though we really targeted the demographic we were after. The ROI was TERRIBLE.

    The bottom line is a company is worth whatever people think it is worth and are willing to pay. Dot.Com Bubble, Great Recession, all these things happened for a reason. How short our memory is and how things never change. There’s no incentive (yet) to use Facebook to find products or services.

    All their IPO is going to do is make existing company owners and Investment Bankers with their VIP clients richer by building enough hype to get the common investor to buy into their Ponzi Scheme. All along hoping businesses will blindly advertise on Facebook just because they fear they will be missing some boat if they don’t.

    Can anyone post any links to any case studies involving ROI on Facebook Advertising and/or Facebook pages that shows a clear, significant positive return? Good luck.

    • http://letter.ly/startupdailydigest Jim Shook

      For a while I had the Ace Ventura movies as favorites on my profile. I was targeted by a t-shirt company that offered a Ray Finkle Miami Dolphins jersey (character in the movie). I eventually bought the t-shirt because it was awesome.

      <– micro example of Fbook advertising working for me, and for the advertiser

  • http://www.searchmarketingstandard.com Jaan Kanellis

    FB ads sucking is one thing. not being able to track the ROI is another thing all together. Cant believe Veronica Stecker cant or isn’t tracking this.

  • http://www.leadingresults.com Dan Kraus

    For business – B2C or B2B (and I think B2C is better on FB) – FB is about being present where the customer or prospective customer spends their time. It is about being able to have a referral be able to find your info, your promotions, your personality WITHOUT have to go off and see your website and leave the comfort of their FB environment. I think ROI is absolutely the wrong thing to measure UNTIL you understand what you are investing for.

    Yup, FB has a problem with showing good ROI – the way we have traditionally measured it. But I think, we as marketers are looking at the wrong stuff. Its not the correlation between money spent on facebook and sales that you measure back directly. Its the money spent on facebook that makes it easier for your current customers to refer you to their friends and associates and the network effect from that – and that is not a simple a->B-C measurement.

  • http://www.betterplr.com Chris Kent

    There was another news item the other day that said that real engagement of people with brands was tiny. Just because they click “Like” doesn’t mean anything more than that they simply do like the brand but not much more!

  • http://www.facebookinstructionsmanual.com Facebook Instructions Manual

    There is a need to have a proper advertisement management by facebook.
    I am using their free service and my conversion has increased by 20%.

  • MRK

    FB wants to have it both ways. They want to sell their stock and be evaluated based on this deep, personalized, proprietary data which they possess – yet then want advertisers to generally take a leap of faith, and treat their ads like some kind of branding exercise.

    So which is it? Are you just a place for us to hang out logo, so we can be “seen” as part of the in crowd? Or are you a true metrics based solution for deeply trackable conversions and sales.

    Cant have it both ways Mark.