Facebook wants to increase its advertising and get more clicks on all kinds of ads. It believes tapping into the lucrative small business market will help it achieve those goals.
Sheryl Sandberg, the social media company's operating chief and "Lean In" author, says the key is showing business owners how to find new customers by creating Facebook pages and by buying ads that appear on individual Facebook users' pages. The company plans a campaign called Facebook Fit with workshops in five cities to show small business owners the nuts and bolts of using Facebook as a marketing tool.
"They don't have enough customers. This is their No. 1 problem and we can help them solve it," Sandberg said.
The small business market has been difficult to crack for digital companies like Facebook and Google, said Greg Sterling, an analyst with the mobile technology research service Internet2Go. Many owners with Facebook pages are reluctant to advertise, limiting the revenue the company can make from small businesses.
"Many of them are struggling just to provide regular content updates or to understand how to use social media, let alone become masters of social media advertising," Sterling said.
Meanwhile, Facebook needs to get more small business advertising to stay competitive with Google, said Debra Aho Williamson, an analyst with eMarketer, a digital research company.
"They need to be sure they're seen as a strong partner to small business owners," she said.
Facebook has updated its technology to make it easier for business owners to use, Sandberg said. The company is targeting those who don't have the time to sit down at a desktop PC and update pages or ads.
"Now they're able to manage their pages from a mobile phone. Two years ago, they couldn't," Sandberg said.
Facebook says it is used by 25 million small business users worldwide. The company does not report the number of businesses in the U.S. or any other country.
Many very small companies that don't have websites use social media services like Facebook to reach customers. When a Facebook user "likes" a company's page, that customer's Facebook friends see posts on their own pages about the company. Businesses can also buy ads that appear on individual Facebook pages.
Facebook is also creating small business advertising products that Sandberg said will be affordable. For example, companies will be able to spend $10 to promote a post on other Facebook pages, something they were unable to do in the past. Facebook pages will remain free.
"We're hoping they'll want to become advertisers if we can help them just spend a few dollars to help them promote a product," Sandberg said.
Facebook is in a good position to get more revenue from small businesses simply because so many of them already use it. But the company must still convince them ads are a good investment.
"They have to make it really simple, affordable, measurable — a small business owner has to be convinced of the success and efficacy of the ad campaign," Sterling said.
Facebook has held workshops for small businesses in cities and towns across the country the past two years, often in partnership with local chambers of commerce and business groups, said Dan Levy, Facebook's director of small business. Workshops are planned as part of Facebook Fit in New York on June 3; Miami on June 19; Chicago on July 10; Austin, Texas, on July 24; and Menlo Park, California, on Aug. 5. Software maker Intuit and payment processor Square will also take part.