Does advertising on Facebook pay?

Almost 1 billion users log into Facebook at least once a month, but the company itself makes a miniscule profit for each account, and makes most of its money through allowing companies to advertise on their page.  However companies are complaining that it is difficult to make efficient use of Facebook.  GM has said that it will stop advertising on Facebook by mid-summer because ad agencies and third-party companies stated that the company wasn’t getting enough returns through Facebook advertising to justify a $10 million annual investment.   A spokesperson for GM’s advertising claims that Facebook does not entice costumers to consider the advertisers products.  This doesn’t mean that GM won’t have a Facebook page for its brand and model but it won’t pay for anymore advertising on the site.

On the opposite side of the scale, Ford Motor Co. wants to increase spending on Facebook advertising this year because they believe that Facebook gives the company an opportunity to build long-term relationships with customers.  The company loves the way their news stories fit into the subsribers news feed because they are in the center rather than in a right-hand column.   A spokesman for the company says that the success of the Facebook ads should not be measured by numbers of clicks or a single transaction but rather a holistic relationship with a potential customer.

From our experience, while it isn’t a complete waste of money to advertise on Facebook, there is a much cheaper way to generate advertising on Facebook, and that is through Word-of-Mouth (WOM) advertising.  This is when someone samples/buys your product/service and are satisfied with the quality of your offering and tell their friends and families about the experience they had at your business.  Facebook is PERFECT for this because it allows WOM to travel much faster than it would be in any other medium, and the best part is that it is free.  The people that you might reach will be less than it would be if you were t

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