Although I spend a good amount of time trading and investing in stocks, my day job is in marketing. For me, the real appeal of Facebook is the ability to micro-market to specific groups in specific locations. As long as Facebook can keep the advertising out of the way of the other features that appeal to FB users, then we can safely say that they are sitting on top of the most effective marketing intelligence engine ever developed.
Traditional marketing through TV, radio, and print is a huge #$%$ shoot. I can convince my client to shell out $100K to buy TV or radio air time, but we can only really generalize who we're marketing to based on the age, sex, and ethnicity demos. For example, if I want to market wedding dresses to engaged women, I can buy ad inserts during shows like "Say Yes to the Dress" or "My Fair Wedding", but I am probably marketing to 20% engaged women and 80% disinterested groups.
When Google Adwords came around, it became possible for me to find women who are searching for wedding dresses and market to them through the Adwords network. I could even to narrow the ad-run down to specific geographic areas, but there was not a lot more that I could do to target.
Now with Facebook, I can specifically find women who have their marital status set to "engaged", and I can even focus my ads on FB users who live on high-income areas like Beverly Hills or New York. I can market specifically to users who are college educated, work in specific industries, or even those who are infatuated with vapid pseduo-celebs like the Kardashians. The local- and micro-marketing opportunities are endless, and contrary to some of the FUD that has been sprayed on this message board, the ROI is solid.
This is the Holy Grail. Every "like" someone does just amplifies their interests. IMO the Google model will die off as they do not have a mobile strategy or the intimate knowledge of the user. The ad targeting capabilities of Facebook are staggering.
So what is your responses to a statement by Facebook that "80% of the traffic comes from outside the US?" In your estimates of ROI how many actual unique active users does Facebook have? Care to elaborate?
My ROI analysis is pretty straightforward. Customer X comes to me and says "find me 1500 heart surgeons to come to my medical conference". If the customer does not have a Facebook presence, I begin by creating them a Facebook page and then run target ads to get heart surgeons to follow the page. One I have more than 400 followers on the page, Facebook allows me to start running promoted posts within their newsfeeds that look less like advertising and more like organic posts. From there, I run a hybrid of pure ads and promoted posts with the goal of continuing to build page followers and promoting the actual event.
Last year I actually executed the above scenario, and with $15K of social advertising I was able to sell over $500K of conference seats (which I was able to track through conversion metrics). The client was able to reduce their traditional print, radio, and AdWords advertising from $120,000 to $45,000 in the process.