Google touts its ad metrics as Facebook confronts hurdles

May 29, 2012

Google just put out a study touting metrics as a way to sell more advertising.

But the most interesting part of the study is the timing. It comes on the heels of the Facebook advertising fiasco, when just days before its hotly anticipated IPO, General Motors said it would stop advertising on the social network, raising the question of the value of a Facebook ad.

The lure of online advertising has always been the promise of immediate and precise information (in theory at least) about how an ad worked. In industry speak, it is referred to as ROI– return on investment.

Google and Facebook are fierce rivals for online advertising and part of the reason for Facebook’s astronomical valuation (yes, even though its IPO was widely considered a flop)  is the promise of it sucking up more ad dollars down the line.

This morning Ad Age reported the back story of GM’s pullout from Facebook, underscoring the tensions between big advertisers and Facebook’s willingness to appease them. GM wanted to do something much splashier with Facebook; Facebook declined. GM took its money elsewhere.

What’s more is that Ad Age’s Cotton Delo cites Aegis Media Americas CEO Nigel Morris, who said that while Facebook is an appealing place, with a membership of 900 million worldwide, demonstrating the ROI is a problem:

“The issue fundamentally [is]: Within the confines of the platform, will it be able to grow advertising as fast as it needs to?” Morris  said. “And it’ll depend, as it does in all media, on showing how effective the platform is and demonstrating the ROI, especially in a world where more and more options exist for brands to engage with consumers. There are more options but fewer scalable ones.”

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Where is the tangible proof that fb has 900 million people who use it, or a number of actual people who use it that’s remotely close to such figure?

Fb states it has 900 million ‘users’ , but a ‘user’ is an identity that people and companies create at will when they register on fb – Anyone can create as many such ‘users’ (online identities) as they wish, and such identities are immortal by definition – They cannot be deleted even if the person who created them wishes to do so, or stopped visiting fb years ago, or uses a different ‘user’ identity/ies.

Over time, many people and companies create multiple ‘users’ identities in fb, whenever doing so helps them achieve whatever goals they’re trying to achieve on this site at that time.

Generally, such ‘puffing’ phenomenon can be observed on many social websites, big and small, where a single person can have dozens, and even hundreds of ‘user’ identities (username, user ID, member ID, etc.).

Has fb ever been audited for the number of actual people who use it, in the sense that they visit that website on a regular, if not a frequent basis, or get some service from it on such basis?

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