It is testimony to the fast-paced world in which brand communication experts have to operate that six months ago few people in the industry were familiar with Facebook; now, with more than 25m users worldwide, the social-networking site is attracting the attention of brands keen to target 16- to 34-year-olds.
Since breaking into the mainstream, Facebook has forged partnerships with advertisers including Apple, H&M and Virgin Mobile. It is now bolstering its commercial offering to take on rivals MySpace and Bebo in the battle for the youth market (Marketing, 6 June).
Facebook traffic has more than doubled since September, when it removed the requirement for users to have a valid university or college email address. In an effort to build monetary benefits from the 3.7m monthly visitors to its site, it is rolling out a number of services for advertisers. It also plans to open its first UK office in August to strike deals with brand owners here.
The success of activity on MySpace and Bebo is prompting a growing number of advertisers to jump on the social-networking bandwagon.
Brands are keen to target the rising number of consumers who are uploading pictures, videos and music to the web, rather than consuming traditional media. Research by MySpace shows that given 15 minutes of spare time, 17% of 14- to 29-year-olds would choose to spend it on a social network, compared with 14% who would watch TV and 9% who would play a video game.
Facebook's commercial strategy goes beyond the standard banners and buttons offered by other websites and social networks. Brands prepared to spend more than £12,000 a month can take advantage of integrated campaigns that tap into its viral nature.
All Facebook activity begins with the creation of a sponsored group, where advertisers can interact with consumers, provide special offers and attempt to become part of the 'fabric' of the site.
When a user joins a sponsored group, their Facebook 'friends' are notified by a news alert on their homepage. Advertisers can also drive traffic to their pages with branded content and sponsored links across the site. 'We have only begun to scratch the surface of marketing opportunities across the network,' says a Facebook spokesman. 'But we realise our users want advertising to be useful and unobtrusive when it does appear.'
Facebook is keen to avoid the criticism levelled at MySpace, which has been accused of becoming too commercial since its acquisition by News Corp two years ago and a subsequent $900m advertising deal with Google.
These charges are firmly rejected by Jay Stevens, vice-president of sales and operations at MySpace, who claims the site carries no more ads on each page than it did at launch in 2003. 'We're a commercial business that needs to make money,' he says. 'But we encourage advertisers to come up with unique experiences that reward consumers for interacting with brands.'
MySpace pioneered the model for advertising on social networks; it charges brands at least £25,000 to create a 'custom community' where they can showcase their products; advertisers to have done so include Adidas and Lynx.
It also recently partnered with easyJet to launch a community that urges consumers to upload photos and video footage of holiday destinations, while users can also download branded 'skins' and 'widgets' to enhance their MySpace page. Similarly, Bebo offers several 'engagement marketing' opportunities to its 8.3m unique monthly users.
Facebook is essentially mirroring this approach, but because it is dedicated entirely to user-generated content and peer-to-peer communication, it is having to be more inventive.
O2 recently announced plans to become one of the first UK brands to take advantage of this creative bent. In a 30-day campaign it will encourage students to generate 'noise' on behalf of their university by joining the site and uploading their photos and comments. The university returning the most Facebook activity will win a £50,000 O2-branded on-campus party.
'Facebook offers integrated opportunities that enhance rather than encroach on the user experience,' says Martin Kelly, media director at Agency Republic, which is handling the campaign. 'It's crucial that Facebook avoids alienating its core youth audience.'
Facebook is already experiencing a user backlash over its commercialisation, but it is taking steps to nip this in the bud. As well as encouraging advertisers to run highly targeted campaigns that improve the social-networking experience, Facebook is setting itself apart from MySpace and Bebo by opening up its application programme interface to brands. This means that advertisers can tinker with the building blocks of the site to create commercial applications that fit with its overall look and feel.
Its efforts bode well. 'Facebook will emerge as one of the most significant online developments of the past few years,' says Rory Sutherland, executive creative director and vice-chairman of digital agency OgilvyOne.
Facebook's advertising strategy is still in its infancy, but demand from brands is growing at a rapid rate. Moreover, if reports of $1bn acquisition talks with Mircosoft, Yahoo! and Viacom come to fruition, it could yet leapfrog MySpace and Bebo in commercial terms.