In recent history, few initial public offerings (IPOs) have been as highly anticipated as Facebook’s. The social media giant is set to go public possibly as early as Friday (although that date is subject to change), and many think it will serve as a strong indicator of social media’s staying power as a public commodity.
Sites like Groupon, Zynga, and LinkedIn famously preceded Facebook as social media companies that have gone public. They’ve seen varied results. Facebook will no doubt learn from their successes and failures in recent months.
At first glance, it may not seem like the IPO will have a great impact on the way marketers and public relations professionals use Facebook. As a manager of four brand Facebook pages, I’ll post content after the company goes public using the same functionality I used when it was private. But the IPO marks a macro shift in the way marketers will use Facebook to connect with their audience.
What’s been largely experimental and trial-and-error based will now have to become more strategic as competition to get people’s attention within the platform inevitably increases.
Here are some of the ways marketers and PR pros should expect Facebook’s IPO to change how they approach the platform:
Fork it over
When a company goes public, there’s automatically additional pressure that didn’t previously exist. Where CEO Mark Zuckerberg once had the luxury of solely focusing on creating an amazing user experience, he now has to deal with increased scrutiny from the media, shareholders, bankers, and individual investors—all while having to make users happy.
If the company’s stock dips, there’s speculation from the media and employees about what’s going wrong. If the company’s stock rises, there’s speculation from media and employees about how long it could last. The stock price is a daily referendum on the company’s performance.
Look for Facebook’s focus to shift to a more profit-focused model. For marketers and PR pros, this means you’ll have to pay more to be visible in this space. Furthermore, it’s going to cost more for the little guys to run a successful Facebook marketing campaign.
Facebook is already expanding its advertising offerings, and these will become even more targeted. Action Spec Targeting
, which is being beta tested now, “is designed to help advertisers target users based on actions they have performed,” according to Facebook. So if I post on my personal page that I can’t wait to go snowboarding this weekend, I shouldn’t be surprised if Burton snowboards is suddenly more visible next time I log on to the service—that is, if Burton has paid to play.
The monetization won’t stop with brands. Expect Facebook to find ways to get its enormous user base to start forking over some cash, too.
Facebook is considering allowing users to pay
to highlight their own posts. You’re having a tough day and want everyone to know about it? Pay a few bucks and your post will be sent to the top of your friends’ news feeds so they can shower you with encouragement. For brands, this means that now you’ve got even more competition when it comes to getting people to pay attention to your posts.
Will these changes make for the best user experience? Time will tell—but they’re certainly decisions and changes that will be made because the company is going public.
How can I be sure Facebook won’t herald the next Great Bust?
The short answer is: you can’t. What marketers want to know is will I be investing my marketing budget in social media for the long haul? Every brand has different goals and demographics they want to reach and a different approach to making that happen effectively through a unique voice and tone.
Facebook rose above MySpace, Friendster, and dozens of other social networking sites that you’ve long forgotten because Facebook focused on continually adapting, evolving, and improving the user experience. The others stayed fairly stagnant and suffered for it. Whether it continues to thrive will depend on how it continues to evolve and improve. It’s pretty much that simple.
If marketers cease to find it useful to pour dollars into social media marketing, it will severely hurt Facebook’s financial health. Conversely, if users start to think that Facebook has simply replaced television as harbinger of annoying commercial content, they’ll start to turn away. If the number of users decreases, marketers will cease to find it necessary to reach their audience in that space. It’s a vicious circle, indeed.
Keep in mind, however, that Facebook is quite possibly sitting on the greatest mine of personal information ever compiled (rivaled only, perhaps, by Google). This will always be valuable as long as people keep it there.
Financial advisors will tell you they don’t have a crystal ball. Whether it be the next Google or the next Groupon, no one can be certain. But as marketers in this age of lifestyle brands and viral content, it’s our responsibility to connect our clients and our companies with the people who are talking about them. That space is Facebook—for now.