With Facebook results having been described as disappointing (advertising revenue growth dropping by eight per cent) and its shares plummeting, Rupert Staines, managing director of RadiumOne explains why he thinks Facebook is facing a tough challenge, the change in attitudes of brands and what he believes Facebook’s role should be in the world of online advertising.
After a tough few months as a public company, it’s only going to get harder from here for Facebook. The problem is, brands are starting to realise that, while Facebook is doing a great job at building brand awareness, there’s still a long way to go before it can convert sales.
A consumer looking to buy a TV, for example, isn’t planning to do so on Facebook – they’re not vising the social network with the intent to purchase, they’ll go straight to Google for that.
Savvy brands are starting to realise the limitations to Facebook and, crucially, that there is also an entire Open Web on which to reach audiences.
Understandably, Facebook is therefore having to compete with the whole internet for brands’ advertising spend.
The brands that will come out on top will be those which harness all of consumers’ online connections (not just those on Facebook) and use this to drive sales. Facebook is going to have to act fast if it’s to be considered a top destination for sacred advertising budget.
By Rupert Staines
Managing Director
RadiumOne
http://www.radiumone.com/