Flowers were added to a Facebook sign in front of Facebook headquarters… (Paul Sakuma / Associated…)
With Facebook about to graduate into the public arena as a company, some analysts say it may need to make friends out of old frenemies -- specifically, advertisers.
"As good as Facebook has been at evolving to serve consumers, that’s how bad it’s been at serving marketers," wrote Forrester's interactive marketing analysts Nate Elliott and Melissa Parrish. "In the past five years Facebook has lurched from one advertising model to another."
In reality, the question isn't really how to serve two masters, the users and advertisers; there is only one true master -- and no, it's not you and me, said Donna Hoffman, a marketing professor at UC Riverside. "Facebook is a marketing tool. That's what this IPO is all about."
Road to IPO
As the home base of 900 million users' digital lives, they have a captive audience and have yet to figure out how to captivate those eyeballs effectively. The current approach to advertising with ads on the side-rail is "still basically like a Google ad word," Hoffman said.
The difference, however, is that with Google, users are actively looking for something. What Facebook users are searching for is appeasing their fundamental need to connect -- with one another, not with products, Hoffman said.
Among the various motivations and types of users, she pointed out -- the egotist, the nostalgic reconnector, the distant relative -- not one of them is there to be marketed to. "They're not looking for marketing messages."
"Liking" a product or having a friend "like" a service isn't satisfactory, she said. "I don't want to be stalked by my favorite brand on Facebook. People aren't on Facebook for that."
Facebook's mobile product currently serves no ads, and users may not be receptive to that kind of intimate targeting. "What users don't want is to have ads pushed to their mobile phones," Hoffman said.
Despite Facebook's challenge of how shape the platform as a marketing medium, doing so seamlessly probably won't cause users to flee in droves. As a society raised on a steady diet of radio and TV, replete with advertising filler, "consumers understand the bargain," she said.
That's a bargain, however, that founder Mark Zuckerberg may not be altogether comfortable with. His loathing for advertising is no secret.
"We doubt Zuckerberg’s going to wake up any day soon having acquired a taste for advertising, or even a proper understanding of it," wrote the Forrester analysts. "And so every day more smart marketers are going to wake up and look for other places to dedicate their social resources."
Under the spotlight of selling stock to the public, the clock is ticking loudly. As Facebook continues to try to figure out mobile and marketing, how long will it be before it becomes the MySpace or Friendster to another new social-networking platform that has it all figured out?
"Marketers can't count on things improving anytime soon," wrote Elliott. "We wish we could predict this IPO would serve as a new beginning for Facebook’s marketing offering, and that a new focus on becoming a grown-up business would inspire the company to put even half the energy into serving advertisers that it does into serving users."
"I'm not saying it's doomed to fail," Hoffman said, "but they are a long way off."
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