So, in that light, I want to examine the numbers: According to Comscore, in June, over 130 Million people within the US used Facebook. This is about one third of the population of the US that uses Facebook – some of them day after day, many times a day, making it one of the most popular media sources ever in the history of the world. However, despite this, Facebook may only bring in $1 Billion this next year, even with expected growth. This may seem like a lot money, but it’s actually not – and I know why.

The Superbowl gets around 100 million viewers each year. While the number goes up and down, it’s a good round number for this post and makes it easier for me to do the math. According to my research (Google) there was last year 62 ad slots sold at between $2.5M and $2.8M. That’s at least $155M in revenue, perhaps even as much as $175M in revenue for whichever network broadcasts the Superbowl. That means each viewer is worth at least $1.50 for the Superbowl.

In contrast, the number $1 Billion estimated in Facebook revenue is for their 500 Million (and growing) users throughout the world. While I can’t find any numbers that say how much revenue is generated in the US and how much is generated internationally, I’m going to make a conservative guess that at least 90% of the revenue is US based, meaning that next year $900 million dollars is expected to be made from Facebook. That means that each US user, over the period of the year is only worth about $7.00 for the entire year.

That is a ridiculously low number if you think about it. Viewers watching a several hour football game are worth 21% of the value of a Facebook user who may use the site 365 times plus a year, spend hundreds of hours a year talking to their friends and family, and more importantly interact with people of similar interests, communicate their needs, buying habits and much more. If you translate the value into hours of use of a Facebook user compared to a Superbowl watcher, an hour of a Facebook user is insignificant – I can’t even do the math, but you are talking about hundredths of a cent per hour for each Facebook user compared to around 50 cents per hour per Superbowl watcher.

The value comparison here is hard to believe, in light of all the media coverage about Facebook. This raises two possible sets of questions.

The first set of questions asks what the real value of an internet user is. The second set of questions would ask why we can’t monetize those users. If we concentrate on the first set of questions, we would come to conclusion that internet users, especially those on Facebook have little value financially per user. That the only reason that Facebook has any value is because of press coverage of the substantial size of the user without comparing the users actually value. When you look over the value of broadcasting corporations in comparison to their revenue, the inflated difference is great.

The second set of questions interests me a great deal more, because it might have two subsets. The first question to ask is, is it easy to acquire users for a social networking site (and then lose them like MySpace) and how relatively cheap is their value. We are estimating the value of Facebook at 12 billion, although the majority of those users have only been on the site for less than a year. They have no loyalty, they have no value beyond that time. Any significant change in Facebook, or the rise of another more interesting social networking site could immediately doom the value of Facebook. Their value when it comes to advertising is clear. I’ve pointed out, that so far, their value is insignificant per user.

So, now the important question: why are these users so useless, and why can’t we monetize them? Why hasn’t interactive advertising advanced far enough that it can actively engage users and create both branding and direct response experiences for social users that equates to actual value? This is a very significant question for anyone who is looking at the development of advertising on the internet and the value of social networking to advertisers.

We can believe that either we haven’t learned how to monetize these users and we will very soon, or we can believe that the value of a social networking user is useless. This is probably the most important question of our time when it comes to the economy and its relation to advertising on the internet.

I believe the issue is simple: we need to be considerably more creative (as does Facebook) about advertising on the internet.

After 10 years of substantial growth, we still depend too much on display advertising in the form of 728×90 banners. I remember in 2000 being introduced to some of the rich-media expendables that are still in place.

Facebook, on the other hand, still depends completely on CPC text advertising for its revenue. Here is the good part: this means whoever finds a way to be creative can monetize these users significantly. I am of the opinion that the Facebook user’s current value is less than 1/100th of what it could be – that for every dollar made now, within the next few years someone can figure how to bring in $100.

Whatever this might be, I’m not sure – but it does mean that monetization of users needs to be beyond the CPM, beyond the CPC, and start to use possible metrics and systems that we haven’t even thought of.

Facebook has become an incredible online community that is a gold mine for anyone interested in advertising or creating brand awarness. Not only does Facebook have over 400 Million active users, but it has many great ways for business owners to reach these users in a legit way. Below we will talk about the core advertising methods you can dabble in on Facebook and how you can make the most of them.

5 Ways to Promote Your Business on Facebook

1. Facebook Profiles

Creating a profile is the most basic thing you can do on Facebook and it is required if you want to do anything else such as create a group or page. Make sure you fully fill out your profile because a full profile looks a lot more interesting then an empty one. You can also add your website URL in several locations and be sure to talk about your business and plug your website URL in the appropriate spots as mentioned.

Then you should start adding friends to your profile each day. The Current limit is 5,000 friends but this may be lifted in the future. If you add 20 friends a day which would take you maybe 5 minutes in one month you will have 600 friends! From my testing you will have to type in a CAPTCHA or anti spam code for the first 10-15 friend adds, but after that it seemed to go away and it was a lot quicker to add friends. I wouldn’t not recommend adding to many friends each day because it will come off as spammy.

Now that you have your profile created and optimized you can create a Facebook group or even better a Facebook page, both of which we will go over below.

2. Facebook Groups

Groups were available before pages and are more of a place for users to discuss topics such as graphic design or cars. Its almost like a mini forums. The benefits for group owners is they are very viral and you can bulk invite all you friends to join your group. The problem is they are not indexed and not available to view unless you are a member of Facebook.

I recommend creating a Facebook group for your business, but honestly Facebook pages are really where its at and you should focus your efforts on your page instead of your group.

3. Facebook Pages

Facebook pages are all about business and have many of the same features available as groups, but with some extra key features available. The main benefit of pages is the fact that they are indexed by Google and available to view even if you are not a member so promoting the page is easy.

When creating your page make sure you use your most important keyword as the page name so that it shows as the page title, making your page more SEO friendly. Like you did with your profile, fill out your Facebook page with all relevant information about your business, website URLS and so on.

The best way to promote your page is to offer some sort of giveaway if you are not a major brand. This way you give a people a reason to become a fan of page. Once they are a fan you can send updates which is the best part of having a Facebook page for your business.

Groups may work well virally, but so do Facebook pages. Whenever some one becomes a fan of your page it shows up in their profile and looks something like this: Person’s Name, Became a fan of Your Business Name.

So if you give your page a good jump start it could really take off. The number of fans you can have has no limit and some pages have anywhere from several thousand fans to over 500 thousand fans!

So if you wanted to focus on one thing I would highly recommend creating a Facebook page, instead of a group and putting all your advertising efforts towards the Facebook page.

Some Example of Popular Facebook Pages

• Pizza
• Domino’s Pizza
• Pizza Hut
• MoonViper Web Services

4. Facebook Applications

The introduction of Facebook Applications is probably the most popular move made by Facebook to date. They released their API so developers and business owners could collaborate to create fun and cool applications that engage users. The applications created so far vary in purpose; some are fun games, some are useful and some are directly related and tied into businesses.

Many popular applications have hundreds of thousands of monthly active users and that information speaks for itself, so if you want to read more about creating applications for Facebook, I highly recommend checking out the Facebook Developers page. Once you have an application created, be sure to add it to your profile and to your Facebook group and page!

5. Facebook Ads

Facebook ads are a great way to really increase your exposure using highly targeted CPC and CPM Advertising. You can target users by age, gender, location, interests, and even attach friend-to-friend interactions about your business to your ads.

The best part is you can either advertise an external website or a Facebook page. So if you created a page earlier for your business and you are looking to build up your facebook fan page you can do so easily by driving the traffic form your advertisements directly to your page.

So join Facebook today and start working on your Facebook promotions, because if your competition is not on Facebook already, they will be soon!

What if you don’t have a Facebook Page?

If you don’t have a Facebook page, we can create one for you for as little as $100. Simply contact us for more information.