When rebrands go wrong

(And how to avoid the pitfalls)

Facebook can’t just sit on its data goldmine

Facebook now has a higher valuation than McDonald’s and Disney following its IPO. Staggering at first thought but not so surprising when you consider how much people, including its investors, interact with the brand on a daily basis. But while Facebook appears to have the stimulant to keep consumers coming back for more, the advertisers so vital to its revenue are starting to crave a tonic to ensure their repeat return: data.

Lara O'Reilly

Marketers, agency executives and those close to the social network from a variety of different sectors have let out a rallying cry urging Facebook to do more to provide proof that social campaigns positively affect their businesses’ bottom line.

In Facebook’s defence, it ran its first marketing conferences around the globe this year, has case studies and regularly meets with its clients to do just that. Brands including P&G, AB InBev and Diageo have all previously declared Facebook has helped them build brand affinity.

These efforts, however, haven’t quelled the concerns of all advertisers. Indeed, US car giant General Motors confirmed this week it is to pull all paid-for advertising from the site, saying it has little impact on sales. Considering GM is reported to have spent $10m on Facebook ads in 2011 alone, the news will come as a blow at a time when investors are looking for signs of its long term revenue growth.

Marketers say they are feeling slightly underserved by Facebook, post-campaign. The reason: they are not being provided with enough analysis on their campaign success that ties their 28,000 likes and 500 shares to a verifiable revenue bump.

Fellow Marketing Week columnist, associate professor of marketing and brand consultant Mark Ritson summed it up: “Brands are learning for all the eyes and the likes, it isn’t always delivering the impact. And it’s that last variable that counts.”

The main issue appears to be that users aren’t logging on to Facebook with a purchasing mindset - if they’re in the market to buy something, they’ll use Google for that. Moreover, Google can provide brands with cause and effect data that their search campaigns led to sales. While Facebook can no doubt influence the ultimate purchase decision, that’s extremely difficult to quantify. It may need to get outside help to get over this hurdle, but either way it must do more of its own advertising to let brands know how to analyse their activity.

Mark Zuckerberg and co. have done a truly incredible job in making the user experience on Facebook second to none - hence why 526 million people visit the site daily, according to data it released in March.

The issue for marketers is that the experience, thus far, has not catered for brands and their needs for advertising to convert to purchase - not just warm, fuzzy feelings.

Unless Facebook adopts more of a commerce or even a search model, it will be difficult for the site to prove definitively that a campaign on its platform can directly enhance the revenue of one of its advertisers. For all the brand case studies currently available on its dedicated marketing website, the dollar sign is sadly absent from many of its examples.

As time passes, brands are moving beyond trial stage and are beginning to assess the true value of their Facebook campaigns as they make decisions on how to slice up their budgets for the coming year.

It is vital Facebook provides marketers with the data they crave if they are to convince their finance directors that social campaigns truly benefit the business.

It’s important to be where your customer is and with a user base of more than 900 million people, Facebook is no doubt that place, but brands can carry on residing their free of charge on their pages.

If Facebook is to secure advertisers’ long term spend and retain its lofty share price, it must do more to prove that paid-for advertising on its network is a sure bet for increasing sales rather than a punt in the dark.

Readers' comments (4)

  • What us Marketers need to understand is that companies should not just rely on one social media channel to drive a return on investment. Marketers need to be aware that they need a variety of different touch-points to engage and communicate with their audiences. It is at this point that Analysis and Evaluation needs to be implemented in order to establish what is effective and what is not for the company.

    According to Facebook.com (2012), they have over 901 million monthly active users at the end of March 2012. Compared to 526 million daily active users on average in March 2012. Therefore, not all of its members use Facebook at any one time. Consequently, there are millions of people in the world that never use Facebook.

    As a result and to sum up, Marketers and Companies should not just rely on one Social Media medium to drive a return on investment. They should think creatively and innovatively about how to engage with audiences, and even to connect with audiences that may never have heard about their product or service. Who knows, you may find some new customers and consumers.

    Facebook is a good Social Media tool but is definitely not the be-all-and-end-all for any Marketing, Advertising and/or PR campaign.

    Unsuitable or offensive? Report this comment

  • Dino has it about right, could just add that in some segments associating a brand with Facebook can do more harm than good.

    For investors, IPO valuations are not a good indicator of how a company will perform in the future in terms of share value or dividends. especially an internet based one - think dot com crash!

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  • What us marketeers NEED to understand is that facebook is not dominated by the conventional rules of commerce.

    We are thinking of facebook as a tool to achieve ROI, or a social media website. Instead, we should start thinking of facebook as a third dimension, a third world, where brands are not brands but people. No matter how much advertising a person carries out to himself, if he has not got the values, the appropriate hobbies, points of contact, personal relations with certain groups on facebook, sponsorship of these micro communities or promote discussions, then it is bound to a limited potential.

    To increase figures, A brand on facebook does not only need to be known by people, but has to be popular. It has to relate to other brands on facebook and interact with them, and show what brands on facebook they do not share a common ground with.

    They have to be inspirational, not just to communicate. Brands have the ability to become the opinion leaders of the opinion leaders and direct their influence not just through their actions and use advertising to promote sales, but not their own sales.

    What if we changed the panorama a little, and a "popular" brand carries out advertising to influence the sales of a company that is in their supply chain, where the advertising acts as a endorsers recommendation rather than a self egocentric "choose me" scenario.

    Another issue is that marketeers need to understand that in this third world, one of the main pillars of our society, currency, is non existant. Hence, it is not about the physical price, it has never been about the physical price.

    Many people ask if the 104 billion dollars are worth it, and we ask what facebook can do for us, rather than us thinking what we can do through facebook and how our brands can become human, overpass location and physical barriers and be everywhere at everytime being, all the time, never dying, never sleeping.

    Facebook is there, "it is a world that exists". It is us that should start to co-actively pursue what can we do in these wonders and the benefits they offer.

    Unsuitable or offensive? Report this comment

  • What us marketeers NEED to understand is that facebook is not dominated by the conventional rules of commerce.

    We are thinking of facebook as a tool to achieve ROI, or a social media website. Instead, we should start thinking of facebook as a third dimension, a third world, where brands are not brands but people. No matter how much advertising a person carries out to himself, if he has not got the values, the appropriate hobbies, points of contact, personal relations with certain groups on facebook, sponsorship of these micro communities or promote discussions, then it is bound to a limited potential.

    To increase figures, A brand on facebook does not only need to be known by people, but has to be popular. It has to relate to other brands on facebook and interact with them, and show what brands on facebook they do not share a common ground with.

    They have to be inspirational, not just to communicate. Brands have the ability to become the opinion leaders of the opinion leaders and direct their influence not just through their actions and use advertising to promote sales, but not their own sales.

    What if we changed the panorama a little, and a "popular" brand carries out advertising to influence the sales of a company that is in their supply chain, where the advertising acts as a endorsers recommendation rather than a self egocentric "choose me" scenario.

    Another issue is that marketeers need to understand that in this third world, one of the main pillars of our society, currency, is non existant. Hence, it is not about the physical price, it has never been about the physical price.

    Many people ask if the 104 billion dollars are worth it, and we ask what facebook can do for us, rather than us thinking what we can do through facebook and how our brands can become human, overpass location and physical barriers and be everywhere at everytime being, all the time, never dying, never sleeping.

    Facebook is there, "it is a world that exists". It is us that should start to co-actively pursue what can we do in these wonders and the benefits they offer.

    Unsuitable or offensive? Report this comment

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