independent

Wednesday 16 April 2014

Facebook: friend or foe of the small business?

Will Facebook encouraging small businesses to set up pages make it the ultimate ad platform, asks Matt Warman

What’s the first thing a new business needs? It used to be business cards, fuelled by vending machines in service station forecourts, but today the conventional wisdom states that a website – often cheaper than business cards – is all a new firm needs.

Facebook, not without self-interest, doesn’t think even this need be the case.

The world’s biggest social network is making a push for the micro, small and medium business to use its services to build, maintain and promote a web presence, and to build its customer base.

The site might, however, have a point.

Building a bespoke website is expensive, and building and hosting anything costs money. New businesses have, quite reasonably, got better things to worry about than how to get a widget to work on their website.

No matter how easy any hosting firm claims it will be with their template, there are always niggles.

But Facebook’s suggestion is not just an easy option: it fits neatly with the nature of many of those small businesses.

Whether it’s a local high-street coffee shop, a fashion boutique or a local plumber, all businesses are social.

Facebook allows the easy identification of customers and it also lets those customers do a business’s advertising for it.

Perhaps most importantly, it also provides opportunities for firms to talk to their customers in a way that simply wasn’t previously possible, from offers to opening times.

Sheryl Sandberg, the company’s chief operating officer, says the SMB sector is a particular focus.

“There are 25 million that have pages on Facebook, and that’s a really great first step, because just historically, it’s very hard to get small businesses online,” she said.

“[And] rather than going to them and saying, do you want to become an advertiser, you say, do you want to promote a post. That’s what’s working, and we’re able to convert them to advertising, and then upsell them from there. And we’re excited about it.”

It’s no wonder that Sandberg’s “excited” – the prospect of turning tiny businesses into paying advertisers is like looking at a mountain of cash that no other business is in a position to try to claim.

Google can’t ask users to buy adverts without a website, whereas a page on Facebook is much easier to set up, and similar to the personal profile that many business owners will already have.

Getting a fraction of businesses online would make a massive difference to Facebook.

With the site’s new advertising products keenly based on data, sentiment about adverts has also improved.

Even with more adverts, the percentage of those that are clicked on has remained steady.

So Facebook starts to look like the ultimate ad platform – users perceive a benefit to them from telling the network, and their friends, who they are in ever greater detail.

For small businesses, it offers a real chance to capitalise on a user base that stands at 1.23billion and is still growing.

It’s no substitute, of course, for a fully fledged website, but for many it’s more than close enough.

Telegraph.co.uk

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