M: Business 3rd Edition by O. C. Ferrell, Geoffrey Hirt, Linda Ferrell

Exercise 4

Facebook fan pages have become a popular way for companies to connect with consumers. Yet some small businesses are taking the Facebook phenomenon a step further: they are using the site to sell actual products. One of these early adopters is Guitar Syndicate, Inc., a brick-and-mortar music business based in Kansas City. The company has been gathering Facebook fans through weekly contests and giveaways since 2009. Recently, it joined forces with Core Commerce and discovered Facebook’s online store. Guitar Syndicate now uploads inventory right onto its Facebook page. Should a “fan” purchase a Guitar Syndicate product via Facebook, Core Commerce software takes the customer directly to Guitar Syndicate’s website to complete payment. Guitar Syndicate sales have grown by almost 20 percent since its Facebook store was added.

Having a Facebook fan page has created many advantages for Guitar Syndicate. Fan pages are inexpensive and easy to produce, making them accessible to both small businesses and large corporations. On the other hand, having an effective Facebook fan page requires commitment. Facebook friends want to feel like an important part of the company. This requires a company like Guitar Syndicate to be dedicated in responding to fan posts. Facebook pages also carry risks. It is easy for dissatisfied customers to post negative comments on Facebook, which can easily become viral and create negative publicity for the company.

Despite these risks, Facebook has helped generate business for Guitar Syndicate on a more consistent basis. With the average user spending over an hour a day on Facebook, the social networking site offers a significant opportunity for newer companies like Guitar Syndicate to get their names out there.

How would you critique the cost of “Facebook marketing"?

Step 1 of 2

Like other major decisions of business, cost is one of the major constraining factor tends to be in marketing. It cost quite a lot to outsource social media marketing services and can make things extremely difficult for the marketers to market the product.