Anyone for Facebook shares? Well you may already be too late.
Following the announcement that Facebook would be floated on the New York Nasdaq exchange valuing Facebook at $104bn; today has seen a mass frenzy as investors have clamoured to get their hands on the $38 share price. This has put Facebook at the centre of the biggest company flotation in history.
Another great day for the founder Mark Zuckerberg, as his 28.1% share ownership will see him instantly rise into the super rich list.
However, despite the money talking, there are still concerns over the fundamental advertising value of Facebook, with the concern being that it’s newly perceived value does not match up to it’s true advertising value.
It was announced earlier this week that General Motors (with an advertising spend of $1.83bn) were in fact pulling their ads off the Social Network as it was not seeing a proportional ROI in comparison to other social marketing avenues.
Nate Elliott, an analyst with the interactive marketing firm Forrester, wrote on his blog: “We wish we could predict this IPO would serve as a new beginning for Facebook’s marketing offering, and that a new focus on becoming a grown-up business would inspire the company to put even half the energy into serving advertisers that it does into serving users.
But we doubt Zuckerberg’s going to wake up any day soon having acquired a taste for advertising, or even a proper understanding of it. And so every day more smart marketers are going to wake up and look for other places to dedicate their social resources.”