How Will The Facebook IPO Affect Brands?
The quick answer to this is ‘it won’t’.
In the short term, Friday’s IPO won’t make a great deal of difference to the majority of brands on Facebook. In the long term I would expect Facebook to use some of the $16bn war chest they will have at their disposal to develop more features that brands can leverage to help build better and more valuable connections with their customers. They will certainly ramp up mobile which is an area they know they are not strong in, as more and more users are connecting to Facebook via smartphones and tablets. Brands will, of course, have to keep working their socks off to produce useful content that keeps their fans and customers interacting with them. 
In terms of advertising, we are going to see more of it! Advertising is how they make the bulk of their money and as a public company they are going to have to meet some aggressive growth targets each quarter for both revenue and net income. While General Motor’s decision to pull their advertising on Facebook isn’t really a big deal financially, it has highlighted the fact that currently, the response rates are weak compared to Google and advertisers who are looking for quick wins or sales won’t see the return they are after. However, Facebook aren’t short on brainpower and I think they will figure out the monetisation ‘problems’ pretty quickly and we’ll see some innovative ad formats appearing both on the site and through mobile.
I don’t claim to be an expert on the financial markets but it seems to me that as “the banks who led Facebook’s initial public offering – in which $16bn of shares were sold to new investors – were forced to move in to the market and buy shares in order to keep the price above the $38 level” (Forbes.com), the IPO wasn’t as much of a resounding success as we all thought it would be at the end of last week.
