Facebook Not Impressing Some Advertisers
Valleywag doesn’t elaborate on the media buyers complaining that advertising on Facebook just isn’t worth it. But if this is the frigid, penetrating tip of an iceberg, all eyes will soon be on Mark Zuckerberg, watching to see how he’s going to fix things.
Zuckerberg, in the meantime, will look back with yearning at the billion-dollar acquisition offers.
Media buyers…report that the college social network is a truly terrible target. They’re mainly students, with low disposable income, of course; but, beyond that, the users appear to be too busy leaving messages for each other to show much interest in advertising. Facebook’s members appear indifferent even to movie advertising aimed at their demographic. Clickthrough rates, the percentage of time users click on an ad, average 0.04% — just 400 clicks in every 1m views
MySpace, on the other hand, not only garners twice the click-through rate (for the advertisers mentioned), but has Merrill Lynch stoked about the money it’s making – about $25 million a month in advertising. Facebook, again, is looking at about half that, but if it’s true that advertisers are unimpressed with the returns, don’t expect that Facebook to reach those numbers again.
True, it’s more than click-throughs these days. It’s also about having presence with the right crowds. Jobster is a good fit for a place like Facebook, for obvious reasons. But in addition to the market itself, the click-through rates could be a flub on the advertiser’s side.
Think back to college and what life was like. You had no money – enough to grab a pizza from time to time, a few beers here and there (and there and there and there), and sometimes, go see a movie as long as it’s not "a date-date." But for the most part, you got nothin’.
It also shouldn’t be so surprising that college students are often oblivious to anything off-campus, but quite absorbed in campus life. When I was in school, if World War III wasn’t commencing at the student center, I pretty much didn’t know about it. So, anything that happened after the OJ trial but before 9/11 is still a mystery to me because I just wasn’t paying attention.
It would be very interesting to know which advertisers are reporting bad returns on their advertising investment with Facebook. It’s easy to point fingers and say it’s not working, so dump it. It could be the wrong market, or the wrong tactic.
But if it is true on a wider scale…and heavy hitters like Yahoo lose interest…Zuckerberg may look back on 2006 as the year he shoulda sold out.