I got this in a email today from Johnathan Leger.Pretty interesting. We all knew it was going to happen, and it finally has: in 2010 Facebook overtook Google as the most visited site in the United States, receiving 8.9 percent of all US web traffic versus Google's 7.2 percent. Does it matter? Do we all need to run out and start optimizing Facebook pages and buying Facebook ads to take advantage of this? Is all of that Search Engine Optimization going to come to nothing? Let me start by saying that of course it matters. As people who market our businesses online, it's important that we understand the shifting tides of Internet traffic because we need to get some of that traffic to sell our products and earn our advertising revenue. So it's important that you start analyzing Social media to see if it should have a place in your traffic-building efforts. Read that last sentence again: it's important that you start analyzing Social media to see if it should have a place in your traffic-building efforts. Social media is not the best place to advertise just any kind of product or service. Think about it this way: would it make sense to advertise your insurance company during a televised football game? You might be tempted to think, "everybody needs car insurance, including people who watch football, so yes it would be a good place to advertise." Wrong. You might manage to get one or two people who happen to be in need of car insurance to watch your ad for a few seconds ? and then immediately forget about it. That's about as far as it would go. It might be okay for branding, but if you're looking to make direct sales, forget it. Why wouldn't it work? Because people at a football game aren't in the "insurance" or "responsibility" frame of mind! They're thinking about the game. The the teams, the score, the action, the fun. It's the wrong time to try and get people to focus on making financial decisions. You'd be much better off advertising a brand of beer or snack food (and you very often see such commercials during football games). My point is this: Just because there are a lot of eyeballs watching the game doesn't mean that a football game is the best place to advertise just any kind of business. The same is true of Social media sites like Facebook. Yes, they are insanely popular. Yes, people spend a huge amount of time on them. But what frame of mind are people in while browsing sites like Facebook? What are they thinking about? Facebook is called Social media for a reason. People mostly use it to connect with friends and family. There are also some business relationships established there, but those are in the minority. There are other much more established sites for Business connections (like LinkedIn.com). When people are on Facebook they're either 1) communicating with friends, 2) communicating with family or (and I have to add this) 3) playing games. Because yes, Facebook games are also wildly popular. Let me give you another example. Let's say you're at a family reunion (or a high school reunion for that matter) and somebody comes walking through the crowd of people trying to peddle that same car insurance. How receptive do you think the people in the crowd would be at that point in time? Facebook is the family reunion. It is the high school reunion. It's not the right place to advertise just any kind of product or service. On the other hand, if you're on Facebook posting pictures of your baby to share with your family and you see an ad for a custom scrapbook of your child ? that's a different story. Or if you're messaging your friends to figure out where everybody wants to go for dinner this weekend and you see an ad for a great local Italian restaurant ? alright. The problem with Facebook ads is that you can't target like that. Facebook ad targeting is not contextual. The content of the page is not used to determine what kind of ads to show. You can only target your ad based on the location, age and interests of the logged in Facebook user. That means it's going to take a lot more eyeballs to hit on a pair that are actually interested in what you're offering at that moment. That can get expensive. Google, on the other hand, is where people go to research everything they're looking to buy. If somebody is searching for "Dallas, Texas car insurance" then you know exactly where and what they're after at that moment. That's where the guy peddling car insurance is going to find his next customer. It's that difference in function and purpose that accounts for Google's $24 billion of ad revenue in 2009 versus Facebook's $2 billion in 2010. Even though Facebook gets more traffic, it has a small fraction of the ad revenue. Does that mean you should ignore Facebook? Not if your business has a social aspect to it. That $2 billion is up from $800 million in 2009, so clearly Facebook is growing, and there's a reason for that. But it's important that you analyze whether or not your business can profit from Facebook right now. Many have, and many will, but yours may not be one of them. If Facebook eventually adopts a context-based advertising model then it will be a real no-brainer for pretty much everybody. If you can tell Facebook to show your car insurance ad when people are talking with friends and family about car insurance, then you've got a winner. But then that whole privacy issue Facebook is so fond of would come into play? I've noticed a little bit of contextual targeting with Facebook, but it appears to be far more limited than AdWords and AdSense, and advertisers have a lot less control over where and when their ads get placed. Even if Facebook does adopt a contextual advertising model, the simple fact is that people aren't on Facebook when they're looking to buy something most of the time. People go to search engines for that, of which Google is King. They go to Facebook to hang out, chat with friends, see what people are up to. Sorry if I'm pounding on this too much, but it's social, not commercial. So until Facebook improves the advertisers targeting ability, or builds some kind of search engine capability into it, you better stick with Google unless you have a social-centric product to peddle.