If Facebook's latest earnings are any indication, its flip-flops-and-T-shirts aura that's kept some b-to-b marketers at bay is giving way to that of a company serious about making money. First-quarter ad revenue totaled $1.25 billion, up 43% from the year-earlier period. As of March 31, the social media platform had 1.11 billion monthly active users, up 23% from a year earlier; mobile active users were up 54% to 751 million.
“I acknowledge the perception is there,” Elisabeth Diana, Facebook's advertising communications manager, said of the platform's laid-back image. However, she added, “from day one it's been about connecting people to the businesses they might be interested in.”
In the last year, Facebook has rolled out a number of optimization and advertising programs.
Its Conversion Measurement program helps marketers know the direct impact of ad campaigns and which ones result in conversions. Once campaign results come in, Facebook can start serving ads to people whose profiles match the ones that triggered the conversions, increasing a campaign's effectiveness.
Facebook also rolled out Optimized CPM, a program that allows marketers to set marketing goals and then optimize their ads against those goals. Diana said companies using the program are seeing an average 40% drop in cost per acquisition. “You're serving ads to people who are most likely to convert,” she said.
Facebook is also extending its reach off-line. It inked a deal with market analytics company Datalogix, which will link data when Facebook users see an ad for a product on the social site to their offline purchases. “It's a new and innovative way to close the loop,” Diana said.
So far, 16 million small businesses have set up pages on Facebook. “We have an installed base of engaged people,” Diana said. “Companies that optimize for reach on Facebook see an average 70% lift in ROI.”
“Facebook is something every business needs to have a strategy for,” said Adam Kleinberg, CEO of Traction, a digital agency based in San Francisco. “Your customers are people, and people are on Facebook.”
Kevin Arsham, VP-account director at TargetCast, said many companies are relying on Facebook for customer support. It's particularly good at helping companies understand consumers' concerns and encourage fans, he said. “Companies are relying on social media to hear what people have to say,” he said.