At a time when Facebook reported an impressive result for Q3 2013, a report by Forrester, the trusted market research group, says Facebook creates less business value than any other digital marketing opportunity for marketers!
The report based on a survey of 395 marketing executives is indeed shocking. With a reported daily active user base of 728m and a monthly active user base of 1.19 billion, Facebook undoubtedly offers marketers the largest audience in digital reach. But despite these figures and the fact that businesses spend a large budget advertising on the platform (a sure reason for the recent Q3 2013 impressive results), the Forrester research report says, Facebook is a disappointment for marketers!
Announcing the findings in a blog post title: “An Open Letter To Mark Zuckerberg,” Forrester Analyst Nate Elliott wrote,
Facebook is failing marketers.
I know this statement sounds remarkable, perhaps even unbelievable. After all, you offer marketers access to the largest audience in media history and you know a remarkable amount about each of your users. As a result nearly every large company now markets on Facebook. Last year your company collected more than $4 billion in advertising revenues.
But while lots of marketers spend lots of money on Facebook today, relatively few find success. In August, Forrester surveyed 395 marketers and eBusiness executives at large companies across the US, Canada and the UK — and these executives told us that Facebook creates less business value than any other digital marketing opportunity.”
Elsewhere Nate Elliott says,
“You’d expect a site boasting the largest audience and the biggest collection of data to fare well. But we found that Facebook offered less value than anything else on our list …. The least valuable tactic within Facebook? Those paid ads onto which Facebook has shifted focus.”
The Forester group is so disappointed with the research result that they advised advertisers:
“If you want to buy ads on Facebook, rely on facts rather than faith. We’ve no doubt that for some marketers targeting some audiences, Facebook advertising can work. If the site really performs well compared with your other media buys, go ahead and spend money there. But marketers tell us Facebook ads generate less business value than display ads on other sites. It’s time to make decisions based on facts, not on faith or fascination. You’re just buying display ads! Don’t dedicate a paid ad budget for Facebook. Make it compete with other media buys based on performance, just as you would any other site.”
But Why Is Facebook Such A Disappointment to Marketers?
Nate Elliott adduces this to two reasons:
1. While Facebook promises to help companies engage with their customers, in reality Facebook only exposes brand messages to only about 16% of their fans!
2. Facebook static-image ad units offer marketers less impact per impression than what they are getting on other platforms. Facebook ads are not really as valuable as other marketing tactic businesses are using on the site.
Indeed, the above reasons may seem logical enough but beyond these we mustn’t forget the power of intent.
Unlike Google, where the intent is basically to find something (and therefore more open for marketing materials), on FB the intent is to like/follow. A huge number of the people on Facebook are there not to be marketed to but to interact and engage with peers and acquaintances. Companies need therefore to move away from the traditional marketing mindset to creating educative content that will help them engage and interact with their target audience.
Static-image ad units may not produce the expected results but any company that will focus on strategic content marketing with the mind of educating, engaging and interacting with the target audience, will definitely return a more pleasant result.
<2>What’s The Way Forward?2>
Nate Elliott advices Facebook to refocus its efforts in order to realize its enormous potential but I think companies should also look inward and re-strategize if they want to see better results on Facebook. While Facebook works to build bridges between the companies and their customers , fully leveraging social affinity data within their ad targeting products (as suggested by Nate Elliott), companies should also look to engaging the services of influencers and professional content writers to help them better engage with users rather than simply putting up static-image ads.
Also, the fact that the research puts On-site Ratings and Reviews and Search Marketing at the top of the list, as seen in the graphic above, is a definite push for businesses to consider product reviews and engaging SEO writing services in order to drive more organic traffic.
What do you say about this Forrester research? Do you agree that Facebook is not giving enough returns for marketers?