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Understanding Facebook and how it can grow your business

Written by Nick Johansson of Pixelmade on 09 April 2013

Many business owners are personally active on Facebook but fail to understand how it can be used to grow their business. In this article, Nick Johansson explains how to turn Facebook into a powerful marketing tool for your business.

What is Facebook and how does it work?

Facebook is the largest social network in the world with 955 million monthly active users and over 550 million daily users (source: TechCrunch). In a nutshell Facebook is a social network that offers individuals a place where they can communicate with their friends by posting photos, creating events, sharing news and video chatting. Additionally businesses are allowed to setup pages so they can interact with their customers. In total Facebook offers three types of entities: profiles, groups and business pages.

  1. Profiles - an individual signs up to create a profile with their information and connect and interact with their friends. Individual profiles can only interact with each other when both profiles have agreed to “friend” each other. Posts and comments will only be seen by people you have connected with and not the general public (subject to the user’s privacy settings).

  2. Groups - groups can be started by any individual and can cover any type of topic. Groups can be public, private or closed (no activity is shared with outside). One great use for groups is the ability to promote internal communication with employees, departments or members.

  3. Pages - commonly referred to as “fan pages” or ‘business pages” these pages are intended to officially represent companies, non-profits, governments and public figures.

How “Business Pages” differ from “Individual Profiles”:

  1. Business pages are open to the public where individual profiles are private. Anyone can view a “business page” but only “friends” are able to view individual profiles.

  2. Individual Facebook users “like” your pages as opposed to becoming “friends” with your page.

  3. When an individual user “likes” your Page they will receive the updates you post on your page in their news stream.

The “Like” button

The “Like” button is the most important button on the Facebook platform. It allows individual users to “Like” your business pages and any type of content (e.g. comments, articles, videos and pictures).

When an individual user “likes” your business page three things occur:

  1. The page name will be displayed in the individual users profile under ”Likes”

  2. Under the users recent activity on their wall it shows that they “Liked” your page

  3. Any post made on the Business/Fan page has a chance of being displayed in their news feed

Top benefits from having users “Like” your page include:

  1. Updates made on your business page are posted in the users news feed. This is significant because it allows you to have a continual conversation with your customers. For example if you have an upcoming event, you can post it on your Facebook page and it will automatically show up in a user’s news feed and they can comment, like or share that information with their friends.

  2. When a user “Likes” your page they are endorsing you to their friends. The average person on Facebook has 190 friends, so with every “like” your business is exposed to 190 or more potential customers. (Source: NY Times Blog)

  3. When a user arrives on your business page a list of their friends who “like” your page is displayed. This is significant because if a user is evaluating your services/products they will see that their friends “like” your business which is an endorsement for your products/services.

How can I use Facebook to help grow my business?

Increase sales and leads

Increasing sales and leads is the number 1 reason businesses join Facebook (although some people find it hard to admit this). If used correctly, it can be a great tool for promoting your business. You can post a link to your whitepaper, introduce a new product or promote an upcoming sale. Of course there is one caveat when using Facebook to promote your business: NO more than 1 out of every 5 posts (at a minimum) should be about your products or services. There is no faster way of losing fans that posting a continual stream of promotional material. Remember the majority of your post should be providing interesting content that engages your Fans.

Customer service

More and more customers are turning to social media to ask product/service related questions. Using Facebook to answer these questions is a great way to provide customer service. One of the key benefits of providing good customer service on Facebook is that you are providing this service in front of an audience (your Fans), so when you engage and answer your customer’s questions some of your Fans will take notice.

Of course when providing customer service through Facebook there are some general rules to follow:

  • Use a consistent voice when answering customer questions (avoid multipersonality disorders!)

  • Answer customer questions in a timely manner (ideally with 24 hours). There is no worse way to lose credibility than answering a customer’s questions 3 weeks after they have asked it.

  • Be honest and genuine when dealing with customer complaint. Admit if you’ve made a mistake and you’ll look more human for it.

  • Don’t delete negative posts! Address these posts directly and do everything in your power to help resolve your customer’s issues. By acting in this way you show that you’re willing to put the customer first, often leading to a stronger relationship in the long run. And if you have particularly bad customers ripping you on your page don’t be surprised if your loyal customers jump in the conversation to back you up.

Build brand loyalty

Would you like repeat customers that promote your brand their close friends? If used correctly Facebook can help you bolster brand loyalty within your target market. One of the best ways to do this is by recognising and rewarding loyal customers. Here are a few ideas to tryout on your Fan page:

  • Publicly recognise your most loyal customers. A public “thank you” can go a long way.

  • Highlight a post or picture from one of your fans on a weekly basis. This is a great way to reward customers that are engaging with you.

  • Provide exclusive discounts to your Fans.

Marketing research

Your Facebook Fans are a highly qualified and engaged focus group. They are made up of customers who like your brand, are interested in your products and often willing to help you out for free. So when you are considering developing a new product or launching a marketing campaign you need to reach out to these fans to get their insights. Here are a couple of ways to use Facebook for your marketing research:

  • Product research - before sinking a boatload of resources into developing a new product or service make sure you ask your Fans for their opinions. For example if you are considering a new dish at your restaurant ask your customers about it and you will often be rewarded with unbiased information that can help you predict success.

  • Advertising research - if you are planning to launch a new marketing campaign get your Fans input. It’s not uncommon that the marketing message can be misinterpreted and raise negative sentiment toward your company. Here are a couple of examples of advertising research you can perfrom through Facebook: Print advertising design and messaging, new website design, commercial or video advertising, email newsletter content.


Facebook is a great tool that can help promote your products or services. Keep in mind that it's a long-term investment and you are unlikely to see a quick return. It’s also important to realise that Facebook isn’t for every business - but it’s ideal for those companies that believe in engaging their customers and cultivating a community around their products or services.

About the author: Nick Johansson is an SEO, pay per click advertising and social media marketing expert at Pixelmade, a web design firm in Vancouver, Canada. He has developed over 60 websites during his 17-year career. His free time is consumed by his new born son who sleeps through the days and stays up all night. You can follow Nick on Twitter @nick_johansson

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