FaceBook was never designed as a platform for advertising...it was designed as a cool tool for college students. But because of the amazing amount of traffic that visits FaceBook the big advertisers line up to spend a fortune advertising there. Why? Because they are stuck in the old mindset of how many people can we interrupt with our message? Here's the problem though...when was the last time you clicked on an ad in FaceBook? The same thing is true for MySpace...users do everything they can to ignore the ads.
If, instead of asking the question "How many?" companies would ask "Who?" is being reached they'd be more likely to choose a Google AdWords campaign. Why? Because an adwords campaign puts your ad in front of someone who is actually LOOKING for your service. I just visited my Facebook homepage and was presented with a huge ad for Verizon Wireless...the problem, I'm already a Verizon customer. How much more valuable would it be for Verizon to place their ad on Google to display when someone searches for "wireless service" or "cell phones"?
The same thing is true for local businesses? The wrong question is "How many people will see my ad?" The right question is "Who will see my ad?"
Update (7/3/2008) Seth Godin just posted an excellent post on this subject here.
