How Facebook is Changing the Business Landscape

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It wasn’t that long ago that incorporating an Internet presence was optional for a business. Now it’s virtually impossible for a business to compete without paying at least some attention to the F word: Facebook. The implications for business increase in number and detail with every passing day, but Facebook’s impact on the business world can be broken down into a few basic categories.

The Market

The tipping point has passed; according to a recent study, the majority of Americans over the age of 12 have Facebook profiles. It’s no longer a fringe segment of consumers exposed to the networks, ads, and data divulgence of the social media giant—Facebook users outnumber the non-users, and participation is escalating rapidly.

But isn’t just the quality of users that makes Facebook such a crucial part of a marketing plan, it’s the quality of the data integration that is unparalleled. Facebook’s social plug-ins and website integration and personalization enable sharing at a viral level on Facebook and customization on the business’s own website. The amount and quality of market engagement through Facebook is simply too powerful for a business to ignore.

The Data

Facebook’s Insights yield a depth of data about site visitors and ROI that no other social network can offer. By using Facebook’s Graph API in conjunction with Facebook registration, site owners have access to all the public data of everyone who logs into their site using Facebook (or visits while logged in to Facebook). They can see how their visitors arrived at their site, which ads led to what purchases, and what the overall exposure of their site has been on the back of sharing, liking, commenting, and linking . . . it’s a treasure trove of data.

And in marketing, nothing is more valuable than quality data. Facebook delivers it in spades, and inexpensively so. A business that isn’t using Facebook to inform its marketing efforts is likely to be several steps behind their competitors who are taking advantage. There is just too much invaluable information there to pass up. Some would argue there’s too much.

The Security

Facebook users tell all their friends what they eat for lunch, who they hooked up with on Saturday night, where they party, what they buy, how their relationships are going, and what crops they’ve harvested on Farmville. But they also share phone numbers, email addresses, and a host of other more marketable bits of personal data under the assumption that it will not be sold and used to bombard them with spam. Yet there have been repeated instances of third-party apps selling the data they gleaned from Facebook users, including specific user names and other information users for which they had a reasonable expectation of privacy.

Facebook has worked to some degree to prevent such breeches of security and protocol from repeating themselves, but in light of the major security collapse that befell Sony Playstation network users, Facebook users could flee their favorite social destination if they sense that their data is in danger or for sale—especially as Facebook credits begin to gain momentum.

The Currency


It’s not just for Farmville anymore. Facebook credits, a currency used in applications throughout Facebook, is growing as a means for turning Facebook into its own marketplace with its own currency. As Facebook continues to find partners willing to come aboard and trade in the brave new economy of the Facebook world, we can expect to see sales of service and merchandise added to the standard online gaming fare. If spending money on Facebook becomes standard practice, the opportunities to do business directly with Facebook users could quickly escalate from a possibility to a mandatory exercise for businesses both nationwide and local.

The Deals


Successful as it has been, Groupon still operates on the fringe of the marketplace. It uses the power of social networking and high-volume sales incentives well, but imagine what would happen if Facebook employed its own version of that business model in its vastly more immense network of users (you know, the one that includes over half of all Americans over the age of 12). Well, Facebook has begun testing of a Deals service similar to Groupon. The power of the Facebook version, however, is the interconnected nature of the offers. It isn’t just a group of random users simultaneously pursuing the same offer, it’s a network of friends and friends of friends that brings, in addition to savings, a sense of endorsement from trusted sources. Companies with strong Facebook presences will undoubtedly be well positioned to take advantage of this service if and when it goes full-scale. The possibilities for local businesses, the small mom and pop shops are incredibly significant.

The Advertising


During the first quarter of 2011, approximately 1/3 of all Internet ad views took place on Facebook. That’s nearly 350 billion, with a B, ad impressions in just three months. However, the folks at Facebook haven’t seen all that ad service turn to gold, as Google, Microsoft, and even Yahoo! Raked in more total value from their ad sales. Still, Facebook could be worth as much as $100 billion by 2012.

Again, given power of the data, the ease of viral sharing, and the potential for business through Facebook, advertising on Facebook has a ton of potential for taking off, particularly as users begin to accept personalized ads and promotions (directly targeted to their interests) as a welcome part of the site experience. Should the currency of Facebook credits gain traction and the convenience and savings of FB Deals, Facebook could easily become the Walmart of the Web—the enterprise giant businesses can’t afford not to do business with.


2 Responses

  1. hgsdhdsghg

    Again, given power of the data, the ease of viral sharing, and the potential for business through Facebook, advertising on Facebook has a ton of potential for taking off, particularly as users begin to accept personalized ads and promotions (directly targeted to their interests) as a welcome part of the site experience. Should the currency of Facebook credits gain traction and the convenience and savings of FB Deals, Facebook could easily become the Walmart of the Web—the enterprise giant businesses can’t afford not to do business with.

  2. e2solutions

    good post..Facebook allows advertisers to do geo-targeting by country, state and city..This allows the advertiser to limit or expand their message to their target audience based on geo-target settings..

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