Facebook to court small business with free advertising

Facebook is set to launch an ambitious campaign offering free advertising to small businesses.

Facebook is set to unveil an ambitious plan to attract more small businesses to set up shop on the social network. It plans to offer $50 in free advertising to as many as 200,000 small businesses to demonstrate the power of marketing on Facebook.

Sheryl Sandberg is bringing the experience she gained from helping to build the Google online ads empire to Facebook, and she has a strategy to establish Facebook as the de facto place to be. With 750 million members, Facebook represents an audience that can't be ignored, and this campaign is designed to help businesses understand how to take advantage of that audience.

Many small businesses do not have a website. Setting up a website involves buying a domain, and finding a hosting service, and developing and maintaining the site itself. The costs for these things is marginal in most cases, but the skills and effort involved are daunting to many business owners who just want to focus on their customers and building their business.

Facebook makes it easier--both to set up shop and to reach customers. Establishing a Facebook Page is a turnkey, fill-in-the-blanks approach to setting up a presence on the Web, and it doesn't cost a dime. It provides the business owner with a platform for sharing and engaging with customers. If this Facebook campaign achieves its goal, it will also give those businesses a cost-effective means of targeting ads to customers.

When a prospective customer clicks on a Facebook ad, the business ends up paying some set price for that click--like 5 cents. The actual cost of the clicks will vary depending on the size and scope of the audience. The more precisely the ad is targeted, the more it is likely to cost. But, precision targeting should also yield a higher rate of success, so it all works out.

When the dot.com rush hit, businesses raced to set up websites just for the sake of being on the Web. Now, Facebook is almost a Web of its own within the Web, and businesses feel compelled to set up a presence on the social network even if they don't really know why, or what they're supposed to do with it.

If it is successful, this campaign will help jumpstart small businesses on the "why" and "how" so they can make the most of their investment of time and effort in social media--and at the same time generate revenue for Facebook.

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