Facebook business booming
IS your business ignoring one of the biggest markets on the planet? That is the question confronting Australian businesses who have failed to establish a strong presence on the world's most dominant social networking site, Facebook.
While SMEs have poured thousands of dollars and hours into establishing their Google presence, and dedicated large amounts of resources to Twitter, too many have dismissed Facebook as a place for friends to chat and share photos.
But the numbers tell a different story.
According to data from Hitwise, Facebook's share of internet traffic recently surpassed even search engine giant Google.
If Facebook was a country, its user base of 400 million people would make it the third most populous nation in the world.
While its biggest user base is in the US, Australians are also Facebook-crazy. There are eight million of us using the site, equating to about 36% of the country's population. On average, we spend 8.32 hours a month on the site. And it's not just young people - according to a recent Nielsen survey, more Australian over 50 are using Facebook than are not, with 2.1 million older Australians now registered members.
But it isn't just individuals who are using the site. Businesses have recognised Facebook's importance and are jumping on, creating fan pages and are inviting more users to become advocates for their brand.
Businesses are also realising they cannot afford to ignore the Facebook masses.
A survey from StollzNow Research last year revealed 75% of respondents believe companies should listen to what people say on social networks about their products, and follow up with individual conversations. The same survey indicated customers will abandon a company if they read negative reviews about them on a social network or blog.
When you consider that the average user has 130 "friends" and writes 25 comments per month, it is clear businesses have a massive marketing base to tap into.
If you want to sell more and get more customers, you need to take Facebook seriously.
The research phase
Creating a Facebook profile takes a few seconds and essentially no thought, but experts say that isn't good enough. Taking some time out to really hash out your plans and getting your page working as well as it can be first off will save you hassles in the long run.
Facebook regional vice president Paul Borrud says businesses have moved on from asking "why?" to asking "how?" with regards to setting up a campaign on the site.
"I think last year was a really interesting year. We saw a lot of businesses get into this experimental phase with social media, and are now seeing the results. A lot of people questioned it all last year, but this year's it's about moving on and getting involved."
"There are businesses now, small businesses, who are finding really creative ways to leverage the platform. You can take it to the extreme with a brand like Coca-Cola, but there are heaps of smaller businesses doing the same sorts of things."
James Griffin, chief executive of reputation management company SR7, says businesses really need to plan out exactly what they hope to use social media for and what they hope to post on their individual site.
He says businesses need to consider whether the site will emulate the official site in offering ecommerce solutions, links, contact information and so on.
If this direction is taken, Griffin says businesses must be prepared to handle the jump in enquiries, and consider whether they actually have the resources available to devote someone to answering questions and handle online activity.
"I think planning is critical. It's not just about rushing in and filling the need to do it as quickly as possible, but really about having each department and business unit giving input into what they think the page would look like."
Con Frantzeskos, digital strategist at media consultancy DDB says businesses must plan out what type of content will go on the page, who will design that content, and whether the business can actually devote its resources to the project at all.
"You also have to ask yourself what type of content you're putting up there. Is it specific? Why or why not? How will you create the content that goes on there? Think about every single thing you put on the Facebook page and how it relates to the overall business."
"Think about whether you want specific content like video, or whether you'll refer back to the original website. Be careful about the content that's going up there."
Also keep in mind Facebook users are amazingly different from non-Facebook users when it comes to internet usage. Those on the site are spending an average of 25.8 hours on the internet as a whole each month – 3.26 times the amount of time spent by non-Facebook users.
Australian users with Facebook profiles, according to Nielsen director Mark Higginson, view the internet as another media alternative. "They think, 'Will I watch television or surf on the internet for a while...' This doesn't have consequences just for business, but also publishers and anyone thinking about content creation."
Griffin says too many businesses underestimate the power of social media, create a Facebook page and forget about it. This is the wrong approach. Instead, he says, businesses must think of a Facebook page as an extension of their marketing budget – even as a physical shopfront – and devote enough resources to update it regularly.
"Businesses should go into it considering that it's not just going to be handed off to an employee on a part-time basis. Or, if they are doing that, they should have the plans put in place well beforehand."
"Don't think of the website and Facebook as separate, think of them as different channels to market that are connected," Frantzeskos says.
What does it give me?
One of the best and most popular uses of social media has developed as businesses started using profiles as customer service tools. Facebook has become a portal for communicating with customers on an individual basis and solving specific problems and complaints.
While Twitter has become the go-to example of companies engaging in conversations with customers, Reseo chief executive Chris Thomas says Facebook has benefits of its own.
"What is important on Facebook is that you're looking for a social objective with your customers. For example, if you have a subject like hiking, you can facilitate that and create a poll asking about the best hike your fans have been on. You're not talking about the product, then, you're talking about the lifestyle."
Thomas says Ford is a good example of a company using social media to both answer customer enquiries and promote their products. Given the company's recent financial and reputation difficulties, especially in the United States, Thomas says Facebook has helped save the company's standing.
"They are able to redefine themselves as a company, and are even selling cards because of the customer interactions on Facebook and all the work they are putting into it."
Brett Waters, Asia Pacific South vice president of RightNow, says there is a huge opportunity for businesses to create support communities to help customers with individual problems – helping your reputation in the process and providing you with new customers.
"You need to recognise issues, complaints and discussions and then develop a process to answer all of them. Effectively you are extending your customer service department and you need to think of what you're doing in those terms. Take it seriously."
But he adds that creating a community just isn't enough – you need to bring people there. After that, the challenge is keeping people on your page long enough to see some value.
"It's all about providing relevance and giving them quick access to something. If I'm a car insurance company offering insurance products, how do I want to sell that on Facebook? Just saying I'm the "Acme Insurance support community" won't draw anyone, but I could think of a target market and speak to them."
"For instance, one example would be mothers with babies, and the concept of car capsules and issues around that. I could ask about people's experiences with car seats, what has happened to them, and so on. That's compelling, and is in the context of what you're selling. People will stay then for the community, and it will make your page look alive."
Keeping on a community will popularise your page with potentially thousands of customers and followers, who are already listening to anything you have to say.
Not only can a well run Facebook page help your business look good, it can actually help drive traffic on your main site. If your profile is linked up appropriately with users given clear directions to your "real" web presence, then you can expect more hits to be on their way.
Thomas says a well-run Facebook page can help with a company's overall SEO strategy, and says Google will help push your page to the top if you've done your work.
"Facebook pages can rank very well on Google of course, which is another great thing about them. If you're trying to get into the top 10 with other brands, then if you have a Facebook fan page then you're leveraging the popularity of the site."
Thomas says most of the content on the Facebook page needs to be created by the users, and that "fans" will be put off if there are too many discussions or posts controlled by the company itself.
"You don't go putting all of your content on there. The way to approach it all is try to get as much user-generated content as possible. Facebook is a point of engagement, and so you really want to drive those discussions and get in from that perspective. That's the trick for boring brands – making the discussion around your business exciting."
Planning your content
There are a number of different approaches businesses can take when developing a Facebook page, depending on its purpose.
The basics are simple – you sign up, create a name, invite some friends to join and put up some basic contact information, and then it usually spreads from there. But these experts say this behaviour is similar to how businesses treated the internet in its early days, and much, much more can be done to maximise your potential.
Frantzeskos says businesses can create videos to put on their site, create polls, competitions, discussion groups and create exclusive blogs for users. Coupons can be distributed easily, along with discounts and information on new sales and updates.
He says while every business is different, whatever content goes on the site must be thought of as part of the overall marketing campaign and not something separate from the company's main site – the two are telling the same message in different ways.
"It's different for every business, but for a Facebook fan page you need to think about whether you are reflecting the original website or making something different. Think about whether you want specific content like video, or whether you'll refer back to the original website. Be careful about the content that's going up there."
But he also warns to keep in mind that whatever goes on the Facebook page will be up there for a long time. Unlike a company's website, which can be taken down at a moment's notice, removing a Facebook page from existence takes time and the long-term title needs some thought put into it.
"If you're running a campaign about something, and the campaign changes, it's impossible to change the fan page name and it would be hard to let people know that it is obsolete. Assume everything you are building on Facebook is for the long-term."
These experts also say the most successful Facebook fan pages have a unique design that often ties into the company's overall brand. Keeping similar colours and graphics helps keep a cohesive feel.
Also, they point to the "tabs" at the top of each fan page. While Facebook by default names these tabs with generic titles such as "photos", "info" and "events", there is a plethora of information on the web about how to name these titles yourself to fit in with your own page.
Borrud says there are four major principles to follow when creating a Facebook page in order to provide yourself with the greatest chance of success. The first is simple – be open and authentic.
"Make sure the relationship you have with your fan base is genuine, and that you're not just there to create a transaction. That's not a relationship. This is a long-term thing, so be open, honest and authentic."
"The second is to be active and update often. If you update your site with questions, people take part in that and will realise you are active, and start commenting. Third, you need to create interesting ads that will drive people to your Facebook page, such as targeting specific interests."
The final point, he says, is to simply "listen and adapt".
"Brands need to have big ears and really learn from their customers. Take that feedback into consideration, and don't just push things you assume are important to them. Facebook pages need to be dynamic and not just act as a micro-site. It's important to listen to your customers and evolve."
But Facebook isn't just a tool to gain new fans and raise awareness of your brand. If handled correctly, Facebook can drive sales and even bring in significant amounts of revenue.
Computer giant Dell has maximised the reach of its page by offering a design studio online, and providing extensive links and fronts for people to shop. Frantzeskos says this is a perfect idea for online retailers – provided its coupled with a sense of strong community and user-generated content.
"My strong advice would be that you make it as easy as possible for people to buy. If they are on the site and can't interact with anything, it's extremely difficult. Remove the barriers to people interacting or buying, and if you can't do that, at least link back to the original site or ecommerce platform."
Facebook success stories
While it's difficult to credit a Facebook page as a "success", as there are is no set criteria, these experts say there are definite signs you're heading in the right direction – a bustling user base, plenty of discussion, a number of links directed to your site and
Thomas cites American lingerie chain Victoria's Secret a definite example, saying it is beautifully designed with a long list of information available for users. Fans are encouraged to discuss different products and their experiences, along with discussions about non-company related matters.
However, it isn't all conversation. Swedish furniture chain IKEA wanted to earn some money last year but didn't have a huge marketing budget, so it set up a simple Facebook page.
For awhile the site remained quiet as its moderators updated it with pictures of various pieces of furniture. But then it dropped the word that the first user able to "tag" his or her name to a picture would win the corresponding piece of furniture.
Word got out, and the company managed to gain thousands of fans within a short amount of time and quickly gained a reputation for respecting users through its unique and simple campaign – much like the furniture. Users were eventually begging the company to upload more photos – flooding the page with activity.
But it isn't just major international corporations which are taking advantage of what Facebook has to offer. Even smaller businesses are jumping on the trend, including an Indian restaurant called Junnoon located in Palo Alto, California.
The company's Facebook page offers location details, opening hours, photographs and details of upcoming events, but also allows users the ability to book a page straight from the page itself.
By becoming a "fan" of the page, users can also post reviews and rate the food served – and no surprise, most of them are positive.
Borrud says the Aquabumps fan page is one of the most successful he has seen, and credits its popularity to the founder's openness and willingness to create discussions with followers.
"The guy who started it is a photographer, and he takes pictures of sunrises, sunsets, people surfing and that sort of thing. Instead of just outright selling his photographs, he has an art gallery where he invites people to come in and have a conversation about the condition of the surf. He might ask "who's up for a swim?" and get people talking. That's why he has over 8,000 fans."
But Borrud also says while interesting techniques and gimmicks are good and even helpful for your brand, "these shouldn't be the core of your page".
"These are all interesting ideas, but they should all be seen as a tactic which forms part of the overall strategy. Whether it's a promotion, a sweepstakes or whatever, it is not the primary focus and is just working to make the page itself stronger."
While many companies get it right, there are certainly examples of businesses getting it wrong when it comes to marketing on Facebook, and they serve as a warning – take it seriously, or suffer the consequences.
These social media blunders have left companies looking desperate, unorganised and arrogant in the eyes of their customers. Criticisms going unanswered, rampant mocking of the company in question, sarcastic responses all result in a tarnished brand, all thanks to leaving Facebook unattended.
Food giant Nestle recently found this out when attempting to connect with its users on the site. Greenpeace activists criticised the company on the official page for buying from suppliers who allegedly hurt the habitats of several endangered species.
A representative hit back at attempts of changing the company's logo into less-than flattering pictures, saying that "we welcome your comments, but please don't post using an altered version of any of our logos as your profile pic – they will be deleted".
The company followed through with the threat and deleted pictures, followed by a massive outcry from activists. The rep replied sarcastically, saying "Oh please... it's like we're censoring everything to allow only positive comments".
The spokesperson later offered an apology, saying they would no longer be rude when answering questions. But it was too late. News of the bungle had spread across the internet, tarnishing the company's reputation.
Griffin says this is astonishing, and that Nestle should have had specific plans in place for dealing with situations like these. The problem, he says, is that too often these circumstances are underestimated and even considered impossible by out-of-touch business leaders.
"I think it's hard to see why Nestle didn't have a crisis management plan come into action, and if they have one, it hasn't been a very good one. You have to acknowledge the fact that when you engage in social media you are giving people a stage to complain about your brand – and that goes as part of embracing social media as marketing."
"One of the biggest alarm bells was when people on the site were talking about actively hurting the company's share price and hoping they would bring it down. It draws a direct link between financial loss and social media presence – which 18 months ago would have been unheard of."
American department store giant Wal-Mart suffered a similar fate when it disabled discussion boards and other feedback features on its Facebook page, prompting a harsh wave of criticism.
It doesn't just happen to companies with bad ideas. Last year, shopping centre operator Westfield introduced a "All I Want For Christmas Is A Westfield Gift Card" competition, giving users the chance to win $10,000 in a gift voucher. While the competition was popular, the company found itself the subject of hate groups on Facebook dedicated to bashing the campaign.
The problem was that Westfield developed an app which changed a user's status to the campaign's token phrase. Users said this was "taking over" the site, and even accused the campaign of violating Facebook's regulations.
Logitech had a similar situation occur last year when it found users were complaining about products and criticising the company.
However, the company wasn't concerned. A spokesperson told SmartCompany at the time that while the Logitech team was monitoring activity, it wouldn't censor any comments and that "they see this as a page for the fans to interact and converse with one another".
Waters says this move was the right one, as companies need to be prepared to take the bad with the good. These experts say if you're going to put your business out in the open, you need to be ready to take a hit – and deal with the problem.
The bottom line
As social networking evolves, it has become more important than ever for businesses to join these sites and start marketing to a constantly-growing base of customers. Borrud says as more and more businesses enter the scene, they are wondering why they didn't get started earlier.
"More and more businesses are finding out their customers are on Facebook, and so they are going to interact with them there. In Australia we have over eight million active users and more are joining every day. They are seeing the engagement that is being provided."
Waters says businesses need to think of how they will approach social networking in ways that are unique to their own strategies, and not just copy the efforts of others.
"Everything is different, and every business develops these things in their own way. But you have to be committed for the long haul. You won't get an immediate result from testing out on social networking, you need to set your expectations on doing things over 12 months."
"After that you can look at what you've done, consider it, and then assess whether it's working or not. But be prepared to put some deep thought into it and develop a cohesive strategy."