Added On: Friday, February 01, 2008

Fanbook

Helen Coster 01.28.08, 12:00 AM ET

Ditch your Web site. Facebook and MySpace are eager to help small businesses find friends.

Many people who dine at Junnoon, a ritzy Indian restaurant in Palo Alto, Calif., use Facebook to schmooze with one another. When restaurateur Sabena Puri realized that, she decided to make sure Junnoon had its own spot on the social networking site. Puri created a profile page that includes photos of the restaurant, reviews and a link to Amazon, where Facebookers can buy a book written by the restaurant's chef. Since August, 94 Facebook users have become "fans" of Junnoon. They post reviews of meals they've had there--one member raves about its lamb biryani--and make reservations at the eatery.

Puri, who paid nothing to create the profile, offers a free glass of champagne to anyone who joins Junnoon's Facebook presence. Puri now plans to send e-mails promoting Junnoon's Facebook site to 5,000 customers. She has also learned from Facebook, which is eager to boost revenue from advertisers, that 60 members around Palo Alto say they like Indian food. Puri plans to target them with ads. "They're people who want to know about us," she says.

Puri is among a number of small-fry entrepreneurs using Facebook, MySpace and other networking sites to communicate with fans, target potential customers and generate word-of-mouth hype. There will be lots more: Social media companies aim to attract more ad dollars by offering to mine profile data of their members so that marketers can target their ads.

In November Facebook launched Social Ads, which sends ads to a user's pals when a member makes a purchase from a participating marketer's site. Social Ads cost as little as $5. It is similar to Beacon, the free program that allows Facebook to track users' purchases and broadcast them as a newsfeed to their friends. What's different is that users can opt out of Beacon, which critics have blasted as a privacy threat. They can't dodge Social Ads. And at MySpace, under a new program called SelfServe, the site will soon allow business owners to follow a series of prompts to quickly choose the audience that will receive online ads.

It's working out nicely for Spreadshirt, a Cambridge, Mass. outfit that sells personalized T shirts, hats and such. The company sends banner ads to random MySpace members as they fill out their personal profiles. Jana Eggers, chief executive of Spreadshirt, credits the banner ads with boosting by 20% the number of people who use Spreadshirt to sell their own customized products.

Some small companies find online hobnobbing more effective than waiting for folks to find their Web sites. Linda Goodwin, the owner of Shoreline Surf & Wakeboard in Ottawa, Ont., uses Facebook to let its 904 fans there know about store-sponsored bus trips to events. (A wakeboard is like a small surfboard, towed by a motorboat.) She keeps people interested in Shoreline's Facebook site by posting videos of people using wakeboards that they bought at her shop. "We can send messages directly to [people] instead of waiting for them to visit our Web site," says Goodwin.

Like other small companies, Goodwin doesn't pay for her Facebook presence. But Emily Riley, an analyst with JupiterResearch, says social networking sites may eventually offer entrepreneurs more promotional tools, like those many big companies purchase.

Sometimes, as in the real world, it takes a gimmick to get people engaged. The Middlebury (Vt.) College Book Store hosts promotions for Facebook fans--it has 279--who can win free textbooks and get discounts on their birthdays. Lush Ltd., producer of handmade skin and hair products, has links to six different organizations on its Facebook profile page, including Stop Global Warming. That has helped the company, which set up its profile in November, attract 1,206 fans. Global warming may help bring people together but, once they're hobnobbing, they "love to discuss what they've bought," says Lush Chief Executive Mark Constantine.

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