socialmediocrity

That much is true. And sometimes lots of them.

But are Sweepstakes a good way to acquire fans? High profile examples might make us think a bit harder about how best to use prize draws.

Let’s consider the Chase Freedom facebook page, and a recently ended sweepstake that offered two levels of prizes. Firstly, 504 prizes of $500 each, issued through a Visa Pre Paid Card, to one winner every hour for 21 days. The prize cost of this element then is $252,000. But that is dwarfed by the Grand Prize: One lucky winner will be selected at random to $1 million.

Wow.

Total prize fund for this campaign then being $1,252,000.

The page itself, on the 28th October 2011, just a few days after the grand prize closing date, stands at 474,203 fans, or Likes. That’s approximately $2.64 per fan, even if every one of those fans was generated directly by virtue of the prize draw, based only on the cost of the prizes, and before any related marketing costs or at least the costs of planning and designing the competition have been taken into account.

Cost per fan, at least $2.64.

If there was little or no marketing spend, then it would be safe to assume most of the Fans were existing customers that heard about it through their regular notices from the bank. So the increased value to the bank will be: some slightly more engaged existing customers? Perhaps three weeks of incremental positive sentiment amongst customers and the small number of friends they may have affected?

Alternatively, if there was in any way substantial marketing promotion of the sweepstake, and let’s face it if you’re giving away $1m you may as well tell the world about it, then the actual cost  per Fan will be considerably higher than $2.64. What’s more the likelihood is you have a lot of “Fans” that are specifically motivated by prize draws, and that could get expensive to maintain their interest in you brand. They are likely to be transient, unlikley to listen to your messages other than new giveaway or prize draw opportunities, and are probably more intent in finding the next promotion than they are applying for your credit card.

So are prize draws particularly effective ways of driving new fans? Perhaps they are better used as “thank-you”s to your existing customers and fans, and by virtue of that the improved sentiment and loyalty may be a valuable property to build. But it is probably not an effective way to acquire new “fans” – who of course are still some way from being customers – and at a minimum of $2.64 and quite easily double that, it is not even a particularly cost-effective way to generate leads.

As covered in BusinessInsider earlier today, the rise and rise of Facebook user numbers appears to have hit the rails.

In fact, evidence has begun to emerge that many of the key, and early, markets are falling in user numbers. According to Inside Facebook’s data service, the US has lost 6 million users, Canada 1.5 million – approximately 4% and 8% respectively.

Daily user numbers from Google also support that evidence, showing thatdaily user have been falling for several weeks now, cerainly in the US, and the UK, shown.

Daily Facebook users in US falling

UK Facebook users also falling

Better news still exists in other territories, and there is of course a lot more growth to come from the less mature markets. Turkey, for example, has always stood out as an over-adopting nation almost, and yet growth continues there

Growing base in Turkey

Does any of this impact Facebook’s strategic direction? The pressure to monetise existing audiences may grow, especially as FB move inevitably towards an IPO, and it won’t help valuations if falling mature markets become the norm.

Or will falling “western” users increase the pressure to expand in the more nascent markets? And presumably seek to retain and monetise aggressively. The Facebook user experience, which has been exceptional to date bar the occassional privacy indiscretions, could suffer with the combined pressures of growth and revenue.

I’m a big fan of social advertising. I like the idea that advertisers can use that information to give me increasingly relevant ads.

However, as mush as I tolerate, nay, embrace this new model, I can’t abide lazy creative.

Take this example. It talks to me as a fan of Liverpool FC. Bingo. Targeting achieved. I am one. Every bit of one.

But where it fails is the message. Apart from ending the question in their title with a full-stop instead of a question mark, their copy doesn’t seem right somehow.

Call yourself a copy-writer?

Yes, I’ve got the official shirt (two of them, actually).

Yes, I’ve got the hat (even the missus has one, reluctantly)

And yes, the scarf too (again at least 2 of those)

And yet somehow, somewhere, in the mind of a senseless out-of-touch advertiser or copy-writer, the hat-trick has not yet been completed.

Now last time I checked, a hat-trick in football constituted three goals. I remember Robbie Fowler scoring the premierships quickest ever (just over 4 1/2minutes against Arsenal in ’94). Liverpool won 3-0 so he definitely didn’t score more than three.

I remember Peter “good-touch-for-a-big-man” Crouch’s perfect hat-trick, also against Arsenal, in ’07. Liverpool won 4-1, but Peter Crouch only scored 3 of them.

But our learned advertiser, which I trust is the banking partner concerned and not the club themselves, is determined to sell me the mythical fourth constituent of every fan’s memorabilia “hat-trick” – a club-branded credit card.

AllFacebook.com yesterday launched it’s monitor of Fan Pages on Facebook.

Of over 600k fan pages it tracks, less than 10% have more than 1,000 Fans.

Perhaps not surprisingly in the current climate, and of course recent events, is that Barack Obama’s Fan Page is the most popular, with over 4.5m fans. That’s still less than you might expect given his poll ratings, and given there’s around 45million US users on Facebook, but having been Mr President for less than a week, perhaps we should give him some time.

Facebook’s fan page comes in at a lowly 7th in the overall rankings, although we can probably take their 150 million users worlwide as eveidence that they are in fact more popular than that amongst Facebook users.

Food features heavily in the top fifteen, with Coca-Cola (2nd), Nutella (3rd), Pizza (4th), Chocolaaaaaaaaate (9th) and kinder surprise (10th).

Evidence also of Facebook’s growing popularity in non-english speaking territories. Anyone that’s ben using the ad platform to reach users anywhere other tan the US or UK can’t have failed to notice the rapid rise in users in some parts, and looking at the fastest growing pages this is also reflected. 12 out of the 15 fastest growing pages are written in languages other than English (UK) or English (US).

“Masturbation!” is amongst the fastest frowing English-language pages. I guess with all this online social networking to be done, people aren’t getting out so much.

The proliferation of self-serve ad platforms around social networks and pother web properties has brought advertising to the masses. Any and every small business, entrepeneur, start-up hopeful can reach the audience they want to without the rigmarole of finding a creative agency, or even just a bloke with Photoshop.

Ever since Google’s AdWords platform, advertising has become something of a DIY-ers dream.

And therein lies the problem. For all the good that feels like it brings, there is pain to be had, especially for the user. Take our first example, in a series that I suspect might run for many, and which sister-site www.micro-targeting.com has started exposing already.

Let's see. £30 in 10 mins. 60 mins in one hour...30....60....90 ...oh bllx, £500 an hour.

The title is enticing enough. £500 per hour? Well that’s £1,000 before lunch time, even for a late starter like me.

But hang on a minute. What’s the catch? In just 10 minutes I could earn £30. Woo Hoo! You can stick your job whe….hang on one cotton-picking minute.

FAIL.

…to be continued.

see also Advertising on Facebook just doesn’t add up

With new figures showing Facebook overtaking MySpace in the US we’ve begun thinking again about Facebook’s ad revenue model. Of course a recession is always going to cause trouble and concern for ad revenue business models, but with a public platform available, we can begin to get a feel for their actual income.

According to Compete.com, the US user base has just exceeded MySpace’s for the first time, with 59.7 million unique visitors, versus MySpace’s 59.5 million. Google’s AdPlanner appears to show MySpace barely holding on to it’s lead, but it clearly won’t be long before they too will be proclaiming the beginning fo the end for MySpace too.

Of course there’s been constant speculation about the real value of the business ever since the Microsoft investment, which was rumoured to value it at a remarkable $15 billion. Leaked memo’s, emails, and recounted conversations since have reportedly shown that even some shareholders placed some more realistic valuations of $3-5 billion on it.

Heck, we’ve even had the valuation estimated on the Whopper Sacrifice application, placing a tongue-in-cheek $1.8 billion valuation on the community. Before Facebook banned it , of course. And not for the low valuation it appeared to place on the business either.

But whilst I might be over-simplifying things enormously, there’s enough information in the public domain to make an educated estimate.

Google AdPlanner tells us that, worldwide, and to the nearest billion, Facebook attracts 29 billion page views per month, and this is rising steadily.

We also know that, whilst it may vary from country to country and page to page, there are normally 2-3 ads on each page viewed on Facebook. Some pages have no ads on them at all.  So for the purposes of a non-scientific estimate it is probably safe to assume an average of 2.5 thoughout.

That gives us an ad inventory estimate of 72.5 billion ad impressions. every month. And rising.

Of course all the page views in the world (and let’s face it, they do seem to have most of them) are only valuable if you can secure advertising for them all, and at high enough rates. So where would we find out the rates Facebook are receiving for their inventory?

OK, no more rhetorical questions. Although the ad platform shows lower figures rates right now, they do vary, and of coruse much of the ads are not placed through the public platform, but in guaranteed delivery deals. What we can see is that at an average CPM rate of $0.50, if that is what they were achieving around the world on average, would give them ad revenues in 12 months of $435 million. Even if the user base continues to double every 12 months, the next year will generate approximately $630 million.

Of course if they’re not attracting those CPM rates, and let’s be clear that these are not the rates quoted at the time of writing for any markets on the public ad platform, then revenues will be significantly lower, and the same goes for the growth estimates. Sooner or later the rate of growth has to slow down, even for Facebook.

So with an ad revenue income estimate of $630 million, the valuation becomes clear once you determine whether you cup is half-full or half-empty. And of course which version of their costs you are prepared to believe. Alternative income streams should not be ignored entirely, siuch as sponsorship deals, and broader content deals, but with renewed prominence of the virtual gifts business that generates c. $40m per year income, Facebook could be generating $700m in 2009 if they get it right, the vast majority still coming from ad revenues.

Let’s assume costs of $250 million per year, leaving $450 earnings, then a $4.5 billion valuation would not be so obscene. $15 billion, even now, would be.

The key to moving forwards however will be in attracting advertisers, and finding ways to deliver excellent ROI for those clients in order to keep the ad dollars rolling in, at a time when advertisers are looking to reduce costs and slash marketing budgets.

Can advertising on Facebook standup to dominant low cost channels such as paid-for Search, and begin to make itself a regular feature on a marketer’s media plan? The smaller advertisers and marketers are making it work, but not until the larger worldwide agency groups find their way, and bring their clients to the party will Facebook see any great acceleration in it’s ad revenues, and until then their valuation will be debated and speculated over repeatedly.

In what looks like another hack, the socialmediocrity office was alerted to another mildly amusing copy change on the site. Accessing the Advertising platform, we notice that the “Advertising” label has been replaced with “Lying” in English (UK) language. It doesn’t appear to occur in any other languages at the moment.

Crazy People?

Of course, we can’t help being reminded of Dudley Moore in Crazy People when we see things like this. “Boxy, but good” anyone?

It’s beginning to look like these hacks are not being taken overly seriously, and whilst 99% of Facebook users will never see this particular hack, what if the “More ads” link on almost every page (beneath the other ads appearing on the page) is hacked to read “More lies”? In some respects it just goes to show that you should only give users so much control over the platform. Or perhaps open-sourcing translation isn’t such a good idea afterall. It does make me wonder what hacks are being undertaken in other languages around the world if this is able to occur so easily in the US to UK translation.

Either way we shouldn’t be overly surprised at the outcome. The vocal minorities always tend to be over-represented in any debate or democratic organisation, and so if you allow users to vote in hacks, then they will happen regularly as those with nothing better to do actively pursue the intended change.

It would be more concerning if this actually reflected broader user perception of advertising on the platform. Facebook have a series of guidlines to protect users against illegal and offensive advertising, but there is a steady stream of exceptions to this that we, amongst others, have talked about before: Guidelines but no rules.

Perhaps it is time for Facebook to take a harder line against the less principled advertisers, and were a bit stricter on itself when it comes to the ads it accepts. As a married man, I still receive many many ads promoting dating services, gambling products and the occasional get-rich-quick scheme – all of which contravene the otherwise largely well-thought-out guidelines (with the exception of Sex education. But only to adults), and it is the continuation of these largely irrelevant and low quality ads, coupled with no micro-targeting and no micro-messaging that generate poor perceptions amongst users, and subsequently low response rates from consumers, and therefore low value to advertisers.

Of course we’d poll the users to find out what they really thought of the advertising if we could still.

I’m convinced that most users would be more tolerant of ads if they were relevant to them and of a sufficient quality, rather than pay even a $5 monthly subscription to use the platform. But perhaps Facebook will consider an ad-free subscription model too, in the face of such low media rates being generated.

In something of a follow up to an earlier post, Facebook-tastic. Let’s all be fans of everything, it seems Facebook have taken things further.

Or it’s broken.

I was slightly bemused by this.

I don’t know if there is some undefined relationship between the Farm Tavern, a publilc house in Brighton popular with my friend Kate, and the artist Martha Herbst, also from Brighton it seems. But on further investigation, there doesn’t appear to be an obvious one, or at least not one involving Kate. Looking at Martha’s 63 fans, Kate is not amon gst them yet, even.

We’ve seen time and again that micro-targeting is far less effective at increasing response rates if you don’t also micro-message the audience, and once you remove the relevance in this manner, it is easy to see why. This is nothing more than an untargeted ad for Martha Herbst, with a random picture of one of my friends on.

It seems to be a backward step and somewhat puzzling if it is a Facebook initiative, though I would be intrigued to see the results these are generating. Of course this could be what happens when adding Social Actions to your campaign goes wrong, and if that’s the case it is perhaps something Facebook need to protect their users against.

With the financial crisis bringing the cost of celebrity sponsorship sharply into focus for many brands (Brand endorsement under pressure, MarketingWeek.co.uk, 3rd December), what implications could this have in the increasingly social web-wide-world we live in today?

Ever since the first TV reality show, we have witnessed the rise of the everyday celebrity. Think Jodie Marsh, Jade Goody, the slightly camp guy from Airport, amongst others. All of them have come from very normal backgrounds, but acheived celebrity status largely through reality-based shows. But ultimately they have all become celebrities in their own right, and have gone on to be managed and promoted as such.

So what impact have global-reach social networks brought about? Well, the debate about conumers as influencers has raged since Gladwell’s The Tipping Point gained such popularity, although the debate’s origins go back much further. But what we are beginning to be able to observe through social networks is the influence users exercise over each other, and by serving this we can begin to observe the context of that influence between any two nodes (or friends) in the network.

In essence, we are beginning to see the rise of celebrity within private networks. It’s always been there, and I do not suppose social networks have altered it’s occurence. But social networks have allowed any one user to exaggerate their celebrity status within their own network. Think about it. When you login to Facebook, you see a newsfeed, a summary of what your friends have been up to (on Facebook). And assuming you haven’t already carefully fine-tuned your notification settings, you probably filter these messages sub-conciously, reading updates from the friends you consider celebrity, and ignoring, or taking less time over those you don’t.

So imagine reading a review from two people in your network. It coud be about a new film, a new shop, a new album. Anything at all. But which one exerts most influence over you? Would it be the passionately written, more vociferous damning review by someone you barely know at all (and may never have met in person), or would you pay more attention to the moderately positive, slightly favourable review given by one of your networks own celebrities – your best friend?

Social actions attached to ads on Facebook certainly seem to take this into account: “click here, because your friend Joe did”. Or “become a fan of product X, because 5 of your friends are already”. It’s a compelling evolution and an interesting behavioural change for marketers to keep a watching brief over, and a keen eye on opportunities to genuinely amplify their advocates through these new mechanisms.

Curiously, Facebook’s ad guidelines allow for the promotion of sexually related items, but under clause 10, Targeting, stipulates

• Adverts with adult themes, including contraception, sex education and health conditions, must be targeted to individuals of at least 18 years old.

Good job no-one under 18 isn’t having sex then.

Surely this particular guideline is counter-intuitive, especially on the matter of sex education – frankly if you get much beyond 18 without any , you probably won’t be needing those contraceptives either. Or the STD advice.

In fact, I’m inclined to go further and say this is downright irresponsible to deny users under the age of 18 access to products and information that might save themselves from unintentional harm.

I’m not saying every pre-18 year old user is a teen-parent waiting to happen, but c’mon guys. You have the largest online community in the world, one of the “coolest” websites, loved and adored by kids and adults alike, and yet you’re so out of touch at times it’s literally unbelievable.