Facebook Seeks Better Fit With Small Biz
Facebook is reaching out to small businesses with a series of summer boot camps designed to load them with expert advice on how to become successful. Of course, part of that advice includes "advertise on Facebook." This "could really pay off, both in terms of additional revenue and driving interaction between small businesses and their customers on Facebook," said business prof Bruce Bachenheimer.
05/07/14 2:50 PM PT
Small businesses have been an elusive market for sellers of online advertising. That's because the value proposition of those ads is a tough sell.
Facebook hopes to reduce some of the resistance in the small business community to advertising online with a series of summer boot camps, dubbed "Facebook Fit," that combine business advice with a soft sell for Net marketing.
"SMBs tell us that Facebook is increasingly the place for them to grow their businesses. But they also want to hear from SMB experts and leading companies on best practices in other key areas, such as payments, legal services and financial management," said Dan Levy, Facebook's director of small business.
"That's why we're creating Facebook Fit, so SMBs can achieve success in every aspect of their business," he added.
There are 25 million small businesses -- companies with 100 employees or less -- with a presence on Facebook. However, only some 1 million of them advertise there.
"There's an enormous growth opportunity in that gap," Greg Sterling, an analyst with Internet2Go, told the E-Commerce Times.
"If Facebook can bring a portion of the 25 million into the advertiser category," he continued, "then they stand to potentially make a lot of revenue and also increase dramatically their advertising base."
Those additional advertising revenues would be welcome, as it is predicted that revenue growth from advertising will be slipping for Facebook this year. 2014 worldwide net ad revenue will be US$10.75 billion, according to eMarketer. That represents a nice 54 percent bump up but a decline in growth compared with 2013, when revenue jumped 63 percent.
Still, augmenting its small business advertising base won't be easy for Facebook.
"Small businesses are a fragmented market," Sterling said. "They're hard to reach effectively, and often they don't have the time to develop expertise in online marketing."
Moreover, Facebook advertising recently has had a shadow cast over it.
"Facebook is struggling to keep businesses on board at the moment, as they're beginning to realize they're finding it harder and harder to reach their fans because of Facebook's algorithms," Jan Dawson, chief analyst with Jackdaw Research, told the E-Commerce Times.
Some Hand-Holding Required
"Facebook needs to proactively reach out to businesses to convince them of the value of marketing through Facebook to bolster its position," Dawson continued, "Small businesses are unlikely to know where to start with this sort of thing, and that's why Facebook is trying to help them out."
The Facebook Fit boot camps can bring home to small business owners how easy it is to reach an audience for their products and services, noted Bruce Bachenheimer, a management professor at Pace University's Lubin School of Business.
"A big bulk of small businesses are people who don't use Facebook or only use it casually, so they wouldn't know how to use it to promote a business," he told the E-Commerce Times.
"They are a potentially huge, untapped market, and by investing a small amount of money in educating people and training them how to use it -- hand-holding them on how to use it -- it could really pay off, both in terms of additional revenue and driving interaction between small businesses and their customers on Facebook," Bachenheimer explained.
Joining Facebook at the boot camps will be Square, LegalZoom and Intuit, as well as USA Today columnist Rhonda Abrams and digital lifestyle expert Mario Armstrong.
"Our effort is to let businesses across the country know how they can increase sales and make the whole process of managing their business more affordable and simpler," said Faryl Ury, a spokesperson for Square, which makes a small business management solution that includes a credit card reader for performing payment transactions on a smartphone.
"We're excited about going across the country and talking and listening to a lot of small businesses," she told the E-Commerce Times.
LegalZoom is also enthusiastic about the boot camps.
"In Facebook, we've found a partner who shares the same passion for the success of the small business community, and we're excited to help educate entrepreneurs on the important legal matters that can affect their business," LegalZoom General Counsel Chas Rampenthal told the E-Commerce Times.
"Intuit chose to participate in the events in an effort to strengthen the company's position as a small business champion and create new opportunities to grow local businesses," said Intuit Small Business Advocate Leslie Barber.
Facebook Fit boot camps will be held in New York City, June 3; Miami, June 19; Chicago, July 10; Austin, Texas, July 24; and Menlo Park, Calif., August 5.