Facebook has been making the news lately. Last week, I wrote about their share lock-up expiring and a swath of changes that have been completed or are still being implemented. Apparently Wall Street is taking the potentially bad news of the lock-up expiration and the new changes very well. The stock isn’t down, as many claimed it would be – in fact, it’s up to around 23.5, which is about halfway from its original IPO price.
More importantly, agencies have known for quite some time that Facebook has the potential to reach an incredible amount of customers. Clients can benefit from Facebook for a variety of reasons. Facebook is a social media platform that agencies can use to help build their client’s brands, improve customer service, sell services or products, and boost exposure. But it can be hard at times to track all of these beneficial uses and to find out if efforts on Facebook are really working.
Tracking Problem Solved?
In an exciting bit of news late at the end of last week, Facebook has made a pretty bold announcement. According to Eric Abent at Slashgear, Facebook “has announced that it will soon be giving retailers feedback on the sales they receive through ads.” The tool is in testing at the moment, but will be out for all businesses before the holiday shopping season really kicks into gear.
It’s obvious why this tool is important for agencies and their clients. If the tool is as accurate as Facebook claims, this finally allows for solid data behind ads placed on Facebook. More data means better decisions and a clearer picture of your online marketing. Another plus, as Eric writes, is that companies “will know which demographics responded well to their ads and which didn’t.”
The New Tool Looks Impressive
Agencies and small and large businesses should pay attention to this new Facebook tool. Facebook’s new tool is incredibly data-intensive, and it looks very promising. Essentially, they’ve found the answer to the problem of finding out how many people buy a product or service because of seeing an ad, instead of tracking directly as it’s done now through a click on the ad itself.
Nicholas Carlson for the San Francisco Chronicle explains that Facebook has figured out a way to compare data like the “email addresses, home addresses, and phone numbers of about a billion people” with the data that retailers and businesses collect when selling their product. They will then do a bunch of fancy math and make comparisons I’ll never be able to understand. This will allow them to determine whether people looked at a specific ad on Facebook, and whether or not it influenced a sale.
This means, as Nicholas writes, “Marketers can look at [a] report and do a simple return-on-investment calculation based on how many people saw the ad” and how well it performed in terms of purchases. Now, doesn’t that sound a lot easier than trying to make the connections yourself based on hard-to-gather data? I think so.
Lots of Potential
Yahoo apparently has a very similar tool, which has enabled them to get a great deal of ad business. Facebook reaches a much larger audience than Yahoo because of the way the social media site is designed. In fact, in Nicholas quoted a Yahoo source that said this new tool from Facebook “competes with one of Yahoo’s flagship ad products and would kill us.”
Those are some serious words if they are true. Whether Yahoo is “killed” by this or not, I definitely see the tool as being immensely valuable to Facebook, agencies, and businesses alike. It would be wise to pay attention to Facebook as the new tool is launched sometime over the next few weeks.
How useful would a tool like this be for you? Will Facebook become more important for your clients or business?