In the June 12, 2012 New York Times article titled "Facebook Tries to Prove Ads Work," Tanzina Vega writes:
After taking a beating during its initial public offering over questions about whether its ad-focused business model is solid enough for the company to succeed on a $100 billion scale, Facebook is in a hurry to offer up new data to prove that its ads do, in fact, work.
The research, conducted by comScore, is meant to show advertisers that the social media platform can have a direct influence on product sales.
Two of the companies highlighted in the research are Target and Starbucks. According to the data, four weeks after seeing a Starbucks ad on Facebook, people who were fans of the brand, and those who were friends of those fans, increased the frequency of their purchases by 38 percent, while Target fans and their friends increased their purchases by 21 percent.
Previously on May 29, I had proposed a scheme to test whether Facebook users would pay 3¢ a day for a subscription.
A number of readers commented that everything on the Internet is free and the only possible business model for Facebook is advertising.
Ad Measurement Systems
In my private archive, I have a number of news stories describing how general agencies measure the success of advertising. A sampling:
"The 'Paid Organification of Facebook: Why Facebook's Plan Isn't About Display Ads"
The future of Facebook marketing isn't about display ads. It's about visibility and reach. There has been so much pre/post IPO chatter about the flawed Facebook display advertising model. It's been mentioned that nobody clicks on ads and that ads have been ineffective. Frankly, these folks have it wrong. Facebook is undergoing an organification movement that fellow marketer Marty Weitraub has been preaching for years now. Facebook ad units that everyone screams and yells about are fading away; paid interactions, increased reach and word of mouth advertising are coming to the forefront. —Greg Finn, MarketingLand.com, June 4, 2012