If Brands Want Fans, Facebook Will Sell Them Fans

-Chevy Ad Screenshot-The saying goes, “It doesn’t matter how many fans [users, visitors, etc] you have, it’s the quality that counts.” Unfortunately that’s not the way marketers and brands see things. How are they measuring things? By the number of fans of course! Take a recent article by Jared Stevens in which he compares Bacardi to Absolut in regards to their Facebook presence. As of October 14th, Bacardi had “32,187 fans on its official Facebook page; compare that to the more than 432,000 fans Absolut vodka has”, Stevens writes. So does that mean Absolut has been more successful in their marketing?

While the article doesn’t explore whether or not Absolut’s page is filled with 16-year-old fans, it’s clear that brands are looking for a number. That number will then end up in some spreadsheet on some executive’s desk to justify a portion of the company’s ad expenditure for the month. How that money gets spent is one thing but what’s more important is volume of money being exchanged.

Facebook Looks To Protect A Big Business

There are numerous ways to promote your Facebook Page and to attract new fans. We previously wrote about how to attract 3,000 fans in 30 days which outlines many of those ways. There is a much easier way to get 3,000 fans though: buy them. Companies like uSocial have sprouted up to capitalize on this opportunity and some ad networks are placing fan widgets within interstitial pages in Facebook applications.

According to a number of developers, Facebook isn’t a big fan of this new model. One ad network has already received a cease and desist from Facebook to turn off the interstitial ads. Other ad networks are trying to stay under the radar on their fan dealings. That’s because they are making big money on a daily basis.

An Evolution From Cost Per Install

When the Facebook platform launched two and a half years ago a massive cost per install economy sprouted up. Whether it was individual developers looking for more users or large brands looking to expand the user base of their branded applications, money was flowing. I still receive a couple inquiries a week from entrepreneurs looking to purchase installs to promote their applications.

There are entire ad networks still supported by the cost per install economy. Just last week AdParlor (also one of our sponsors) launched a “SuperSafe” tag (see example here) which protects developers from aggressive ads showing up their ad rotation. The majority of ads displayed under this new tag appear to come from other applications. In other words, they’re cost per install ads. Installs currently range from $0.20 to $1.00 depending on who’s selling them.

So how much do fans sell for? There’s a wide range but I’ve heard Facebook is selling fans between $4 and $10. That adds up to substantial revenue for Facebook. For example, let’s assume that the top 100 advertisers each want to purchase 100,000 fans. Theoretically Facebook could generate $100 million just from the top 100 advertisers. As you move down the long tail the numbers begin to add up quickly.

While uSocial is selling fans at less than a dollar, reputable ad networks are selling fans at $1 – $4. Brands are going for it but given that Facebook is trying to protect the cost per fan business, ad networks are being forced to keep their dealings under the radar. While the company has made no official statement on their position toward companies selling fans, it’s pretty clear that they want to keep it to a minimum level.

With hundreds of millions of dollars at stake, it’s not surprising that Facebook wants to protect their business. The only question now is: how aggressive Facebook will get in protecting this aspect of their business. Given that it’s ultimately the Facebook developers who are providing inventory for the Facebook Pages, will Facebook aggressively pursue developers who sell fans? How about ad networks?

For now we’ll have to wait and see but there is no doubt that Facebook loves selling fans to brands! Are you purchasing fans? Do you want to purchase them? Do you think Facebook should stop developers and ad networks from selling them?