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With the Facebook IPO due to start trading this week, the financial world and ad land are abuzz with social media talk. What Forbes calls the ‘$100 Billion Question’ financial experts are trying to figure out the worth of Facebook’s advertising platform. Come to find out, so are the advertisers.
For some, it’s a question of tracking a Facebook ad to the final sale. For others, it’s about customisation and customer service. Facebook is said to be falling down on all of these compared to other sites. It seems the hype around the IPO is starting to put social media on shaky ground. I’ve even heard rattlings on the street speculating that social media in general will not be around in five years time due to its lack of worth.
For those that say the end of social media is nigh, I say, “What does it matter?”
Anything can happen in five years (I’m hoping for hoverboards).
What does matter is Creating Value
The question should be how we advertisers can adapt to these changes in consumer behaviour to create value for brands and their audiences.
Each advertiser needs to judge social media based on its ability to help the company meet strategic business objectives. And it’s up to us advertisers, not Facebook, to create this value. Whether it’s growing market share or improving sales effectiveness, social media is seen to greatly help companies meet various different objectives. As well, those companies with extensive social media presence saw four times the ROI than those with little or no activity.
So for both financial experts and advertisers, the answer to the ‘$100 Billion Question’ depends on how much you are willing to put in.
For advertisers, at least, the future of Facebook doesn’t really matter. It’s part of the ebb and flow of consumer behaviour on the Internet. Our task is to analyse the usefulness of social media and whatever other wonderful things the Internet throws at us to judge what value we can create.