Social Business
Dec 6, 2012

Should Brands Have To Pay Facebook? Responding To Mark Cuban’s Woes

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Dallas Mavericks owner Mark Cuban made headlines recently by criticizing Facebook over paying to promote posts, limiting his ability to reach out to his brand’s fanbase. He then famously threatened to pull the Mavericks from Facebook for the greener pastures of Tumblr.

Though many brands have aired similar grievances against Facebook over the pay-to-promote function, supporting Cuban’s perspective, others have criticized him as both entitled and spoiled, arguing that it’s not entirely unreasonable to now pay for promotion on Facebook after he was able to build huge social engagement through the network organically at little to no cost.

A moderate response to Cuban’s Facebook rant came from Mark Cooper, co-founder of Cuban’s Facebook vendor, Offerpop. Cooper’s original blog response can be read here, but we talked to him a bit more in-depth about the issue of brands paying for promotion.

Cooper’s perspective places the onus on both parties: Facebook and brands using the social network. While Cooper believes that Facebook needs to do a better job pitching to Mark Cuban, and that they need to prove the value of their service before charging brands, he also wrote that Facebook does deserve a piece of the pie at the end of the day.

Social News Daily:You said “Facebook Needs to Prove Value Before Taking a Toll…” but then say that your purpose is to prove Facebook’s worth when it comes to engagement, growth, and turnaround. Are you saying that Facebook should perform that job directly and throw some stats at brands before asking them to buy?

Mark Cooper: Yes, Facebook needs to be more vocal about the ROI marketers can achieve on their platform, so that when they introduce new ad and sponsored stories features, they can help brands understand the value. Social marketing is still very much in its infancy – all of the platforms and vendors in this space need to help companies understand why this channel deserves a share of their marketing budget.

SND: You also argue that Facebook does deserve some payment from brands who use their service to engage with fans. Why do you think that many brands are displeased with paying to reach fans? Do they feel entitled to free, or at least relatively cheap, social media marketing?

Mark Cooper: I think there are some brands that aren’t happy about the idea of paying to reach their fans. [This] could be due to mis-set expectations resulting from the approach Facebook took to bring brands to the platform – letting them set up pages for free. This sentiment will fade as brands start to realize the value Facebook delivers across multiple areas – ads, email, coupons, sampling, sponsorships, and more.

One simple example around email – according to the DMA, the cost of acquiring an email address for a B2C company is $8.73. Offerpop customers with 100,000+ fans collect 15,000 email addresses per campaign on average. So the value of email addresses collected via a typical Offerpop campaign is about $130,000. Meanwhile, the customer’s Offerpop campaign cost is $2,000 to $5,000 – includes our rate plus the customer’s time and effort.

This is huge value, and the amazing part is that it represents only one facet of what Facebook can deliver to marketers.

SND: Do you think that other brands may leave Facebook over the newly-introduced paid promotion aspect? What kinds of alternatives do you think Facebook could adopt to avoid this happening?

Mark Cooper: The lion’s share of brands will stay with Facebook. Over 1 billion people are on the network globally, starting to rival the population of China. Consumers now spend almost as much time online as they do watching TV – about 4.5 hours a day. And the largest share of that time is spent on social networks. And these trends are accelerating.

So consumers are behaving differently, and they’re migrating to new media channels like Facebook. Marketers will reallocate more and more of their dollars to social marketing as a result.

SND: Anything else you’d like to add?

Mark Cooper: Facebook moves very fast and is very aggressive. My advice to them is to spend more time helping marketers keep up.

We’d like to thank Mark Cooper, Offerpop, and Mairead Ridge for reaching out to us.

What do you think? Should brands stick with Facebook and pay to promote their content, or do they have a right to expect free social engagement?


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