Social media marketing takes a hit

Published: May 21, 2010
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Companies afraid of being on the wrong side of Facebook debate.

Companies afraid of being on the wrong side of Facebook debate.

KARACHI: “I woke up one morning to find out my career was over,” says a very frustrated Tahir Zain. He runs Folkhut, an e-business which 100 people benefit from usually makes a projected profit of Rs60,000 every day.

However, profits have fallen to nil since the ban on popular social networking site Facebook. Zain, like many new entrepreneurs in Pakistan, had exclusively focused on social media marketing because it was convenient and affordable. “I was planning to open retail outlets all over the world,” he says, “Now I am an untouchable.

Who wants to do business with anyone associated with blasphemy?” He is one of many to be affected. According to social media marketing pioneer Shahjahan Chaudhary, there are at least 500 companies in Pakistan with a Facebook presence. “Smaller local companies have the most to lose from the ban,” he says. “Brands like H Karim Buksh, Hassan Shehryar Yasin, Ego, Bling, Hina Khan, Gunsmoke and Daman rely on the site for advertising.” While he was unable to quantify the loss that Pakistani businesses would face during the days without Facebook he estimated it could cross into millions. “If you inform 45,000 fans about a Rs1,000 product and 4,000 of them buy it that means Rs40,000 in profits.

But if you cannot inform them then there are no profits to be made.” Fan pages are one of two ways for companies to market themselves on Facebook. Starbucks, for example, has one of the most highly valued fan pages. The Starbucks page is currently valued at more than $20 million in annual worth to the company.

Owner of fashion retail chain Labels, Zahir Rahimtoola, says without their fan page, customers will not be informed about at least three upcoming events. “I am ready to make sacrifices,” he says “but if the ban continues we may have to explore more conventional marketing techniques that are less cost-effective.” The cost for placing an ad on Facebook is negligible, according to Afzal Hussain, regional director business for Pirana. While a standard ad in most Pakistani websites can cost Rs10,000 to Rs35,000, an ad on Facebook costs 3 to 10 cents.

The website launched its ad system in 2007 as a way for businesses to target advertising to the exact audiences they want to reach. The policy was recently revised reducing the number of clicks received by cost per click (CPC) advertising campaigns. The guideline for costs per thousand impression (CPM) campaigns remains unchanged. Affordable and accessible, Hussain says Facebook was finally emerging as a new marketing tool for businesses.

With two million active users in Pakistan, he says, everyone wanted a piece of the pie. But now, only two days in to the ban and companies have been forced to review their advertising strategies. “Companies are rethinking their approach to social media. They don’t want to do anything too bold, flashy or in-your-face.” Besides this conservative uturn, he says, some companies have simply put the brakes on plans for social media marketing projects until the blasphemy debate cools as they are concerned about their image.

With no access to Facebook companies have not only lost access to their markets in Pakistan, says Chaudhary but to those all over the world. “We have not banned Facebook in Pakistan,” he says “but banned ourselves from the rest of the world.”

Published in the Express Tribune, May 21st, 2010.

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Reader Comments (15)

  • Bilal
    May 21, 2010 - 2:04PM

    Hello,

    I think things need to be looked at in perspective. We as a nation are just too quick to haste rather than being reactive we are retentive. Blasphemous content has always existed on facebook, youtube and a whole host of other websties. However because our current government’s image has recently being tarnished by a barrage of comments, videos and pages against it and its various ministers they have decided to leverage the power of our insipid thinking to get these websites banned.

    No doubt the stuff on these websites isoffending but we have shut ourselves out from them rather than the other way round. All those SMSs about facbook going into losses is BS since Pakistan means nothing to facebook i.e. just 0.02% of its revenue. ON the other hand as in the article above our government has taken away an opportunity that young people have created for themselves. Recommend

  • May 21, 2010 - 2:56PM

    My mohallay ki aunty who thinks she’s a designer has also been struck by this madness. How would she market and contact people abroad who buy her joras though all look same throughout?Recommend

  • Reema Hassan
    May 21, 2010 - 3:16PM

    A little clarification here on the following; “While a standard ad in most Pakistani websites can cost Rs 10,000 to Rs 35,000, an ad on Facebook costs 3 to 10 cents”. It should be noted that it is 10 cents “per click”, which averages about $300 per month for a conservative ad campaign. And even then, anyone can be clicking your ad, a competitor or people who may just be curious or click happy, but not necessarily a prospective customer so there comes alot of wastage. We found it to be much less effective than we hoped for our business. It does get addictive though and those clicks add up fast, so if you do try facebook, make a budget and stick to it. Then evaluate the return.Recommend

  • May 21, 2010 - 3:53PM

    Very good report and that’s what I fear too apart from freedom of choice to people. There are so many people using social media marketing, PTA could have simply blocked those offending pages but this is keeping the public away from the knowledge as well as their businesses.Recommend

  • Huzefa
    May 21, 2010 - 4:00PM

    I imagine the cellular network companies are enjoying this ban with a spike in SMS traffic and voice traffic.Recommend

  • May 21, 2010 - 4:23PM

    I fail to understand why facebook is being blamed for this fiasco. There only mistake was taking some time to block that page. And for that matter there are hundreds of other groups and communities all over the internet with blasphemous content on Islam & other religions.

    Facebook has now blocked the page and it not accessible from Pakistan. Recommend

  • cucumucz
    May 21, 2010 - 5:32PM

    Right decision by LHC. I remember when danish newspaper did the same thing few years ago and in response our people burned lot of private and Govt. property in protest . At least this time we successfully stooped these protests to happen. It someone is so aggressively depending upon Google ads , the end result will sth like this.Recommend

  • telcom employee
    May 21, 2010 - 6:04PM

    @ Huzefa
    NO we are not enjoying this ban at all as it has greatly effected our major revenue generation through GPRS/EDGE and Wimax too!Recommend

  • May 21, 2010 - 6:06PM

    gr8 step by Pakistan nothing is important than our religion dont worry bro if one door shuts many will open take this as a opportunity Pakistan Zindabad!Recommend

  • Raza Zaidi
    May 21, 2010 - 6:37PM

    I think I agree with guy above, this is a ploy by our government to censor what we see and hear online. Our religion is important but we should be given the chance to mount a counter offensive against the people who are offending us which are I must add not a foreign government, a nation, a particular race but people who misunderstand Islam and our Holy Prophet P.B.U.H. Recommend

  • Zunaib M Yousuf
    May 22, 2010 - 5:49AM

    Well, how about this, the creator of the Facebook was also the young guy and got successful and by launching our own Social Networking site which would be able to the source of income generation for our country and also would be operated as per our policies solely under the umbrella of Islamic teachings, means no blasphemous activity would occur.
    Yet the only drawback on this would be that we wouldn’t enjoy the wind of freedom of speech to that extent that we do on Facebook, by targeting our politicians or other different characters as the clause of contempt would be imposed on us.
    I am not the IT person but this is the HIGH TIME to make the most of whoever is interested must launch his social networking site and enjoy the lucrative opportunities and also the Pakistanis, Indians, Desis, Muslims all over the world would be more than happy to be the part of that !!!
    GOOD LUCK !!! Recommend

  • Khalid Hassan
    May 22, 2010 - 9:49AM

    Huh! Guyzz think wise.. dnt compare economic issues with religious one… WAT HAPPEN TO OUR SOULS???. .. . Come-up with some wise suggestion to support ineffective banning of FB. Recommend

  • Not Really!
    May 22, 2010 - 1:50PM

    @Living on the edge:

    Yes, brother. If a Muslim opens another door to earn rizq-e-halaal, Alhamdulillah, you will burn it down too. Recommend

  • Acha Ji?
    May 22, 2010 - 1:59PM

    Dear Raza, cucumucs, living:

    Would you like to offer your properties to be damaged and destroyed?Recommend

  • Abubakar
    May 25, 2010 - 1:39PM

    facebook is totally aganist Pakistan and Islam.I think facebook and other sites should totally nip in the mudRecommend

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