As Facebook grows up, it courts Madison Avenue

Mon Feb 6, 2012 3:02pm EST
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By Peter Lauria

(Reuters) - About a year ago, when it became clear that taking Facebook Inc public was a matter of when not if, Chief Operating Officer Sheryl Sandberg went out and poached Carolyn Everson, then global advertising head at Microsoft Corp.

Landing an executive with Everson's pedigree was a coup - prior to Microsoft, she was a top advertising executive at Viacom Inc's MTV Networks and at Walt Disney Co. The hire also sent a clear message to Madison Avenue from the world's largest online social network: We want to work with you.

Until Everson's arrival as vice president of global marketing, Facebook's relationship with the advertising community was at best politely dismissive, at worst outright antagonistic.

Chief Executive Mark Zuckerberg has said he views Facebook more as a way to connect people than a business, and he has been adamant about limiting the impact of ads on user experiences. Indeed, his reluctance to flood the social network with ads is widely viewed as one reason why Facebook endured while an earlier rival, MySpace, expired.

"Mark has an evangelical approach to advertising," said Martin Sorrell, chief executive of WPP Plc, the world's largest advertising agency. "He sees Facebook as a vehicle to open up communication, not to monetize."

But with 85 percent of its revenue derived from advertising last year -- when revenue was $3.71 billion, Facebook realized it needed to strike a more cooperative tone with Madison Avenue ahead of its initial public offering and the accompanying intense scrutiny on profit growth.

Advertising sources identified Everson, along with David Fischer, vice president of business and marketing partnerships, and Blake Chandlee, vice president of global agency relations, as the triumvirate leading Facebook's charm offensive.

"It's been remarkably different over the last 12 months," Michael Hayes, president of digital at advertising firm Initiative, said of Facebook's attitude toward the advertising community.   Continued...