8.7M results

That’s the number of results you get when you type Facebook Hoax 2015 into Google search.

To quote a BBC article, “Life on Mars is more likely than Facebook charges”.

So why do so many people continue to fall for the same hoax every few months? As I write this post, I continue to see friends who post the blurb for all of their friends and family to see:

“Now it’s official! It has been published in the media. Facebook has just released the entry price: $5.99 to keep the subscription of your status to be set to ‘private.’ If you paste this message on your page, it will be offered free (paste not share) if not tomorrow, all your posts can become public. Even the messages that have been deleted or the photos not allowed. After all, it does not cost anything for a simple copy and paste.”

Here Is Why Its Users (1.2B) Will Never Be Charged

Drum roll…Facebook has built an amazing business model. In fact, your life is their business model.

That’s the simple explanation, but let’s dig into what the business model is in greater detail. Businesses already pay (A LOT) to advertise directly to targeted users. When I say businesses, this can include SMB, mid, and enterprise-level businesses. It can also include non profits, entertainers, or anyone who owns a Facebook page to promote their brand or posts.

The model is built in a way that engages users and tries to maximize the amount of time the spend on the social media channel. For example, one of the newer features is that users can opt in to their memories. This option feeds you daily content on memories that you experienced on that same day from years past and then share those memories back into your feed to share with friends and family.

The algorithm is what draws users into Facebook on a daily basis. I will admit that I am an addict. Facebook has the ability to track everything a user does. It has APIs with other software that can track your actions across your mobile devices, computers, tablets, wearables, etc.

Facebook Advertising

Facebook has many options for businesses to engage with users through advertising:

  • Page Post Photo: Prominently highlight an image on your page
  • Page Post Video: Prominently highlight a video on your page
  • Page Post Text: Focused on page engagement
  • Page Likes: Get Page likes to grow your audience and guild your brand
  • Page Post Link: Get people to visit your website
  • Domain Ad
  • Website Conversions: Get people to perform certain actions on your site (requires adding a Facebook pixel to your site)
  • Mobile App: Get people to install your mobile app
  • Desktop App: Get people to install your desktop app
  • App Engagement: Get people to use your desktop app
  • Event Responses: Attract more attendees to your event
  • Multi-Product: Supports up to three scrolling images (great for eCommerce)
  • Offer Claims: Create offers for people to redeem in your store

They also have many options for how your ad is seen:

  • Facebook newsfeed
  • Facebook mobile newsfeed
  • Facebook right-hand column advertisement

Sprout Social has a detailed breakdown of all of the information above if you are interested, when you click here. Ad Espresso has more information here.

Audience Targeting

Facebook offers a lot of options for page owners to target very specific audiences. You can test various scenarios to find your own sweet spot.

  • Demographic Targeting — Location, Age, Gender, Languages
  • Connections — Target users who are fans, friends of fans, or not fans of your page, app or event (e.g., include people who are connected to, exclude people who are connected to, include people whose fiends are connected to)
  • Interest Based Targeting — Targeting an audience based on their FB profile information (likes (other users and pages), interests, apps they use; or target them based on their search behaviors
  • Custom Audience Targeting — upload emails, phone numbers, or user IDs of users you know are interested in your products or services to create a Custom Audience

Here is an example of how Facebook served up custom advertising to my unsuspecting mom based on her connection to me. I get a text from my mom early in the 2014 Christmas shopping season asking if my son still wants a specific toy that I posted about on Facebook from How to Train Your Dragon 2. I am busy at work so I don’t respond immediately. I get a second text asking if my son would want the toy, she is at Target and needs to know. I text her back and tell her I have no idea what she is talking about. We go on for several minutes with her insisting that I posted about a toy he wanted and me rebutting. LIGHTBULB MOMENT: It finally dawns on me that she has seen something in her news feed that has related her back to me. Back in May, I had taken my kids to the theater to see the movie and had posted that we were there. Facebook associates that she is someone who actively likes my posts (I am guessing they can go so far as to know she is my mom since you can link yourself to relatives…scary, I know, but true). Target is creating Connections advertising around products for the holiday season. They served my mom an ad that showed that I liked Target and a big photo of the How to Train Your Dragon 2 right into her post feed. Mom reads this, sees my name, sees the toy, and viola, my son needs the toy. Pretty sneaky but really genius! Sadly for them, it wasn’t his obsession and the toy was not purchased.

Sponsored Stories

But advertising isn’t the only way that Facebook is making a killing. Sponsored stories are a HUGE part of their ecosystem. Sponsored stories are similar to ads but are created by Facebook users and not marketers/advertisers. Each time a user interacts with one of your Facebook pages, a story is created (someone likes your page, a post, uses your app, is going to an event, etc.). Businesses maximize the distribution of this information by paying to sponsor them to appear in the newsfeed.

It is very akin to an endorsement or recommendation for a company. Businesses understand that recommendations from people you know are the most credible way to endorse their products to you. They go so far as to include the user’s profile picture as well as a list of anyone else who is within your network that has taken the same action (liked, commented, checked in, posted, etc.).

Recap: Here Is Why Its Users (1.2B) Will Never Be Charged

WHEW! That is a lot of information but I hope that it gives you a good picture for why your life is Facebook’s business model and why, in fact, they will never charge you using their social channel. The short of it…they need you to grow their ecosystem. Your entry into Facebook’s ecosystem is the price of your personal information and behaviors…and that is PRICELESS to advertisers, marketers, and investors.

Now go back to your Facebook addiction without further fear of being charged a whopping $5.99 (aka, the price of admission to Starbucks!)

Images of Various Ad Types

Event Ad

Event Ad

Photo Ad

Photo Ad



Sponsored Story

Sponsored Story

Mobile App

Mobile App

Video Ad

Video Ad

Page Post

Page Post

Desktop Newsfeed

Desktop Newsfeed

Domain Ad

Domain Ad