Internet marketers are facing a significant change in the way they operate thanks to a deal between Facebook and Microsoft. The arrangement sees Microsoft as the provider of advertising on the Facebook site.

For the past few years Google has dominated the pay-per-click sector, with Yahoo running a late second place and Microsoft trailing behind. Now, if you advertise using pay-per-click, you are going to have to get to know and use Microsoft adCenter.

The reason is the popularity of Facebook. It is the 6th most visited web site in the world – and almost none of that traffic comes from Google or other search engines. Internet marketers can reach millions of people on Facebook now that it will carry advertising – but you are going to have to learn a new system, from Microsoft.

This deal squeezes out Yahoo’s advertising system still further. Once called “Overture” this was the pay-per-click King of the Internet. Now it is being relegated to a comparatively tiny player. The popularity of Facebook is the key here. And the deal should tell Internet marketers a couple of things.

Firstly, you can get a highly lucrative deal (worth $240m to Facebook) if your site is popular with people – and you achieve that by letting your users contribute to your site. Secondly – and this is important to understand – you don’t need Google or other search engines to be popular.

So, if you want big deals from substantial companies, become a popular site that has user-generated content and that becomes big as a result of word of mouth. Oh – and one other thing – how did Google become popular? Via word of mouth, not via search engines.

Do you think these things tell us something? So why is it that so many businesses concentrate on “search engine marketing”? Once again, many businesses owners are focusing on the wrong thing.

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