It looks like embattled Facebook has pulled a PR rabbit out of the hat in double quick time – ‘with a little help from my friends’ as the Beatles sang. In a previous opinion piece on the Facebook IPO saga I commented on what I saw as poor communication from FB which is a weakness when compared with some of their closer rivals.
In yesterday’s Financial Times FB’s PR team managed to get the lead story on the media page. It’s the classic Virgin PR approach as it talks about FB ‘preparing’ to launch a system for measuring advertising ROI.
However the more interesting slant on the story is how they have managed to get two seriously heavyweight industry names to endorse the move. First off is David Jones (pictured), CEO of Havas and a member of FB’s ‘Client Council’ where he says, “what I have seen Facebook working on in ROI is very compelling. They know they need to prove it. You will see that come out in the future.”
Second up is Keith Weed, Unilever’s CMO and another member of the council who says he was “very happy” with the results his brands have gained from FB, adding that Facebook was making “good progress” on calculating its clients’ ROI.
There’s a very good structure to this. It has the key ingredients; announcing something new and good, in the future, backed up by a big advertising name and a big advertiser name, i.e. it isn’t FB saying these things which would carry far less weight in the current circs. In one brief story it addresses the key issues covered elsewhere in the world’s press.
So a very good start but it isn’t helped by the headline adjacent to the story. The ‘Inside Business’ column screamed, ‘How Facebook’s IPO went from triumph to disaster.’ Never mind, at least FB did get the bigger headline.
In a previous FB piece I applauded Apple for its outstanding marketing and one of the strings to its propaganda bow is teasing upcoming events. This feeling of yet another gob-smacking product about to be launched gives Apple the attributes of movement and progression, from memory, BrandZ calls this ‘brand momentum.’
Although I did suggest in the previous piece that marketing isn’t the answer to all of FB’s challenges, I am minded to believe that the FT story is a big and important step in FB wrestling back the PR initiative.
Six months of good, robust stories about FB’s development might just see the IPO saga disappear, just like the initially disastrous Terminal 5 opening drama at Heathrow. Maybe we will see the stock price get past the $38 offer price after all.
It’s clear the Facebook IPO is going to get more and more messy.
It has come to light that Mark Zuckerberg unloaded 30.2 million shares on day one and banked $720 million. By the end of trading three days later the stock had slumped, as we all know, saving Marky the $111 million he would have lost had he had the good grace to wait a few days. The new word in the US for investors who lost out is ‘zucked’.
The bigger question now comes from a serious analyst firm called StarMine, a Thomson Reuters division which claims to offer “unparalleled insight into equity data”. It has put a price on the stock of just $9.40, which is a market cap of £25.7 billion (as opposed to the initial $104bn). For any private investor this must be a shocking assessment from a leading independent analyst. If this is anywhere near reality, a $100,000 investment would be really worth $24,737.
The Paul Simons Casio calculator arrived at $7.60 per share, or a market cap of $21.8 billion. I’m quite relieved a proper firm has come up with a valuation in the same ballpark. My efforts took about an hour reviewing the IPO filing and then doing some basic maths. Goodness knows the level of fees Morgan Stanley charged to figure out an offer price of $38.
I have to believe they know stuff we don’t know otherwise how can StarMine have such a massive difference of opinion about the value of Facebook – they all do the same job and get paid shedloads accordingly. I’m in the wrong job!