And what you need to know about it to create winning campaigns

Its time for Timeline

Facebook's new timeline for fan pages will be rolled out on 31st March 2012. You're already familiar with this from your personal Facebook page so it can be easy to take for granted the implications this will have on your campaign ideas.

The Default Welcome Page

This may be gone - which means no more driving new fans to a splash page with a big arrow to the Like button. But fret not! Many agency partners and clients I've spoken to are desperately lost about how to keep getting fans to Like their pages. As we'll see below, both the Cover Image and the new Timeline Apps are powerful tools to attract and engage with your fan base.

The Cover Image

Now, everyone who accesses your fan page will first arrive on your Timeline page. The general reaction to the new Timeline for Fan Pages has been a positive one so far. And the new Cover Image plays a big part in making it a success. Most brand people love the new wide canvas - and I've seen some good ones from the likes of Fanta, Manchester United and check out this fabulous cover image from the Obama team - a simple picture tells you all need to know about the man. 

The Rules of the Cover Image

But before you put that thinking hat on - I'd suggest you familiarise yourself with the basic rules of the Cover Image.

Cover Images need to be at least 720 px wide and may not contain any of the following:

• Price or purchase information, such as "40% off" or "Download it at our website"
• Contact information, such as web address, email, mailing address or other information intended for your Page's About section
• References to user interface elements, such as Like or Share, or any other Facebook site features
• Calls to action, such as "Get it now" or "Tell your friends"

To help you get started we've created a Facebook Timeline for Fan Pages photoshop template to try out your ideas. Click on the image below to download it.

But why is Facebook doing this? 

Focus on Engagement and Reach - not Fans

Facebook is moving towards a more engagement driven metrics model and is encouraging brands to start looking beyond Fan counts. With the "People Talking about this Page" metric being made public on all Fan Pages, Facebook wants brands to start thinking about their reach (the number of people that see their stories on their feed) and engagement (the number of people interacting with or discussing your brand). Although I applaud this effort, it will take brands some time to adjust their strategy and develop campaigns that have a longer term perspective focused on engaging with fans. 

But in the meantime, our clients are still talking about Fans! I can imagine why many brands may be freaking out about these changes. They want to know how get Fans to continue Liking their pages. We've been educating our clients on the benefits of the new Timeline for Fan Pages, and we've found opportunities to continue to grow your fan base while growing fan engagement. 

Companies should realise there's a lot more they can do on Facebook for their businesses then they currently understand. 

Apps to the Rescue

Apps are the new Tabs but they'll now be at the front and center - right below your Cover Image. This is where all the action is going to happen. Facebook has been working on providing more flexibility to what businesses can do on the site. Starting with the launch of iFrame apps and the Facebook Connect button, today you can build your own unique campaign experience entirely on Facebook and leverage the most pervasive social network to spread your message.

With the Timeline, Facebook apps will get a significant make-over. A new standard 850px wide page will simplify fan page application development and provide users with a more consistent experience across Facebook's 37 million Fan Pages.

But how do we still get the "Likes" if the default welcome page has disappeared? 

Getting the Likes

Brands have to wake up to the idea that a Facebook application's URL is a powerful tool that they can use to drive their campaign. Although we may have lost the default welcome page on our Fan Pages which now forces all users to first arrive on our Timeline page, Facebook allows brands to use the unique URLs of their Facebook Applications in Facebook Ads and campaign executions. This is your new custom landing page and it can be used very effective to both deliver compelling brand experiences while continuing to grow your Fan base.

Timeline Apps - The Real Killer App

With the introduction of Timeline Apps, brands will now be able to add their app's activities to Fan's personal timelines. A great example of this is Pinterest, whose usage shot thru the roof after it launched its Facebook App with Timeline integration in January 2012 making them the fastest internet service to reach 10 million users. Thousands of Timeline Apps have since been launched and Facebook is actively promoting these.

This provides an excellent opportunity to develop campaigns that promote interaction and help spread your brand message amongst your fans' social network. There's never been a better time to build great social apps that will sell themselves.

So if you're planning a social campaign in April - its time for you to stretch your expectations of what your brand should be doing to stay relevant on Facebook.

Update 20 March 2010 - Now published in the Singapore Business Review - Whither Facebook's IPO

The Facebook IPO - Soon to be one of the largest public offerings in the world. Many amongst us are expecting it to be larger than the Google IPO in 2004 - but at $100B, it's led me to question whether Facebook is potentially worth that much.

These days, everyone and their aunt is on Facebook, with developed countries seeing Facebook penetration rates beyond 55% and Facebook claiming over 800M in monthly active users. We expect this number to rise to a billion before the year ends. Imagine 1 billion people spending long hours each day exploring, connecting, and if Facebook will have their way - spending real money on a platform they have complete control over.

And Facebook wants us to believe that all this is worth $100B in valuation. Is it?

Google - The elephant in the room

We often hear Facebook being compared to Google, and rightly so I should imagine. If you look at the two web wonders, they're both really in the advertising business. Google sells "search intent" whereas Facebook sells demographics and social connections to brands in order to make copious sums of money. In my opinion, this is a perfectly good business to be in.

Let's recall the now legendary Google IPO from 2004 (famous for its founders' "Do no Evil" maxim). When Google launched its IPO - it was the largest Internet IPO valued at $23B. Google managed that because they were generating profits off the back of revenues of $4B. Thats a Price-to-Sales ratio of 8.7.

Facebook on the other hand will launch at a Price-to-Sales ratio of 26 based on revenues of $3.8B. This is more than Google's PSR of 8.7 and 26 times more than the average large sized IPO. Are we really expected to take the Facebook valuation seriously with numbers like these?

Sales and Revenue

Today at a market cap of $200B, Google generates over $9B in profits from a revenue of just about $40B. If Facebook were to be valued at $100B, we'd expect it do at least half as much revenue of what Google is pulling in today. But at this point, Facebook barely scrapes $5B in annual revenues. Thats a long way off to be reasonably comparing Facebook to Google.

So if you play it by the numbers above - then Facebook will look like a terrible IPO to put your money into. Can Facebook ever imagine being as big as Google or will it completely dominate Google on the Internet?

The Upside

Now there are some who say Mark Zuckerberg is a smart man and is barely beginning to show his hand. They believe revenues from direct advertising are just the tip of the iceberg for the revenue avalanche they anticipate. And I have to say I'm inclined to believe them. To put things in perspective, Facebook currently makes under $5B in revenues a year. Most of this comes from direct advertising on its site. In 2011, only 11% came from Facebook credits.

To put things in perspective, Facebook currently makes under $5B in revenues a year. Most of this comes from direct advertising on its site. In 2011, only 11% came from Facebook credits.

Facebook Credits

Facebook Credits is the first of the growth strategies that will help Facebook become a giant. Imagine the ability to issue a currency of your own making in an environment which you have complete control over. Facebook Credits is the only means available for applications and companies to bill and charge Facebook users. From virtual goods to social gaming, Facebook applies a 30% processing fees for all transactions, allowing them to cream a healthy margin off the top of every single successful application on the Facebook platform.

Remember Farmville. It's maker Zynga, which incidentally owes its very existence to Facebook, had a $10B valuation when they listed in Dec 2011. And Facebook simply creams off 30% off the top of everyone from Zynga to Disney. Now thats a sustainable business model and Apple has proven it.

Facebook Places and Deals

And then there's Places and Deals. Imagine Groupon built directly into every single brand's Facebook Page! Today Groupon can drive over $10M in revenue for some retailers in a single day and is worth over $15B. Now imagine the amount of revenue Facebook could drive by enabling every single brand or merchant with time and location sensitive deals on their Facebook Pages. This alone could contribute profits of $5B in a couple of years.

Technology Expertise

This is just the beginning, at the recent IPO filing, Facebook revealed information on technologies and patents it has waiting in the wings. I am sure Mr Zuckerberg still has a good number of tricks up his proverbial sleeve.

The Rest of the World

Although Facebook's growth has just about stagnated in most developed countries, they're having a strong run in the rest of the world.

Take Indonesia for example, which has the 3rd largest number of Facebookers in the world but penetration is still at a low of 17%. In Indonesia, you can sense the excitement amongst brands, both big and small, of Facebook and its power to connect with customers. And cheaper, smarter mobile devices will fuel Facebook's growth in these developing markets for some years to come.

Overvalued or Underpriced?

Although I can see the value of Facebook and experience the excitement it has created for digital industry professionals, I still think a $100B valuation is too high at current revenue and profit numbers. That said - I don't see any reason to believe why Facebook can't be bigger than Google in 5 years.