Facebook Advertising Revealed
Posted by Nick O'Neill on July 30th, 2007 4:38 PMThe “non-existent” Facebook rate card has been released from an insider. I found the following rate card to be particularly revealing:
For $15 CPM you can target users within Facebook based on gender, geography, major, interests, activities and movies. Earlier this month I commented on how Facebook can fix their ads. Apparently their ads have been fixed but only for those that are willing to spend $50,000 or more on a marketing campaign. While I still think Facebook would benefit from an adwords like system, this at least reveals that as of now they provide highly targeted advertising opportunities. These rates are from February but I would imagine they are still in the same range. Alternatively, you can spend $150,000 for a 3 month sponsored group on Facebook. Given that there are already over 150 of these sponsored groups, this would suggest Facebook is making over $20 million alone from sponsored groups. Add in their news feed ads at $50K a pop and you are talking about some serious money. For all of you that wanted to know how Facebook makes money, this is how they do it. In my own opinion, if Facebook opened up these targeted ads to the masses, they would be providing a higher value to small businesses and would revolutionize the advertising industry. For now though, you better have big bucks if you want to play. Smaller businesses will have to stick to building applications on the Facebook platform.
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FB have been saying the reason the IPO/Acquisition is far away is that the buyers don't see them as a $7-10b company. Given their growth rate and the fact that this is still a crude business model I think Zuckerman and Co may be right!
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