Sept. 30, 2014

K Street Files: Facebook Friends U.S. Chamber, NFIB

There’s nothing like free advertising. Just ask Facebook.

In an effort to encourage small businesses to get on Facebook, the newly public social network is giving away up to $10 million in free advertising. But the campaign, promoted as a partnership with the  U.S. Chamber of Commerce and the National Federation of Independent Business, is also giving the two powerful business lobbies prominent billing at no charge.

Facebook has bankrolled 22 events around the country that aim to teach small businesses how to market themselves to the 900 million users of the social network. The seminars draw on local NFIB and chamber networks and give participants an opportunity to win $50 in free Facebook advertising.

Last year, advertising accounted for 85 percent of Facebook’s $3.7 billion in revenue, and the company’s future hinges on its ability to draw new advertisers. Some analysts attribute the drop in Facebook’s stock price following its initial public offering to concerns about the company’s ad model.

But the events are also giving the chamber and NFIB a reputational boost. The NFIB has seen a spike in membership as a direct result of the Facebook seminars, said Gina Florence, the group’s director of social media.

“It’s great brand recognition,” she said. “I mean, who wouldn’t want to partner with Facebook? ... Someone who may not be politically driven may be more inclined to attend a Facebook event. This is another avenue for us.”

The NFIB, the third-largest business advocacy group, has spent more than $3.6 million on lobbying since the beginning of last year. Still, that figure pales in comparison with the chamber’s $86 million lobbying tab.

As the chamber celebrates its 100th anniversary, the partnership offers a chance to highlight its social-media savvy and burnish its ties with the increasingly influential Internet industry.

The chamber, one of the most powerful lobbying forces in Washington, D.C., fell out of favor with some Internet companies for its aggressive campaign in support of controversial online piracy legislation. Yahoo dropped its membership entirely, while others, including Google, privately threatened mutiny.

“When they see a name like Facebook together with their local chambers, the turnout has been great,” said Nick Schaper, the chamber’s executive director for digital strategic communications.

Facebook will host two events in Texas on Friday: one with National Republican Congressional Committee Chairman Pete Sessions (Texas) and a second with Rep. Kenny Marchant (R-Texas).

The events not only give lawmakers an opportunity to interact with constituents and prove their Internet IQ, but they also provide an informal setting for NFIB, Facebook and Chamber of Commerce representatives to chat up lawmakers.

A Facebook  spokesman would not disclose how much the company has spent on the project but said that venue rental and travel are the only major expenses.

“We’ve seen more and more businesses use social media to connect with their customers, jump-start conversations about their products and services, and foster long-term loyalty and sales,” said Sarah Smith,  the head of Facebook’s online operations in Austin, who addressed a crowd of some 40 small-business owners Monday in Washington, D.C.

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