By John D. Stoll
No company has experienced growing pains as severe as Facebook
Inc. The company's past failures to ensure privacy, protect data
and police content have left its executives confronting a simple
question: Can we trust you?
Right now, we have little choice, though. We rely on it in this
weird time of disease-enforced isolation, its virtual society one
of our few ways to safely close the distance the pandemic has
forced upon us.
The new question: Will the era represent this social network's
coming of age?
On Saturday morning, I talked with the company's chief operating
officer, Sheryl Sandberg. The company sees small business as an
area where Facebook can prove itself to us again. She acknowledged
the company's missteps.
"I actually think that some of the mistakes we've made and the
work we've done to try to fix those mistakes is serving us right
now."
As stores and services shut in response to mandates designed to
prevent the spread of the new coronavirus, they use social media as
a way to claw for survival.
"I think, at least for now, it is the new Main Street," Ms.
Sandberg said. Facebook Live, Instagram and Facebook Business are
among the heavily utilized services.
One-third of small businesses in America don't have a web
presence at all, according to Ms. Sandberg, but many of those
businesses have long had a Facebook page. It can cost owners as
little as $5 to promote a post. Of the 140 million small businesses
using Facebook globally, 90% use only free services.
In the past, research has suggested Facebook offers these
operators a lot of eyeballs for little money. But ads placed on the
platform often miss their intended audience. A couple of years ago,
the platform changed rules for its newsfeed to make users'
experiences more personal, filtering out the posts of many small
businesses. Big-company CEOs have also pointed to its
limitations.
There are plenty of other tools that small businesses can use,
but mom-and-pop businesses still depend on Facebook, attracted by
the reach and familiarity of the world's most popular social-media
website. Facebook relies on small businesses for a substantial
chunk of ad sales. By providing help, the company can fortify an
important source of revenue.
"Facebook's allowed us to keep the business going," John Dudas,
co-owner of Carol & John's Comic Book Shop in Cleveland, told
me Saturday evening. "It's been a godsend."
Mr. Dudas, also a full-time firefighter, closed the store in
March but kept two full-time employees on the payroll. They deliver
materials the shop sells to houses, including books home-schooling
parents are giving to their children. And they are helping manage
inventory, which was freshly stocked in the days before business
was locked down.
Many comic-book sellers use eBay for online sales, but Mr.
Dudas's approach is mostly centered on real-life transactions and
in-person experiences. New comics come out on Wednesdays, for
instance, and that's a big day to welcome customers into the store
on Lorain Avenue.
Carol & John's has long used Facebook to promote products
and events. Last week it hosted a Facebook Live gathering to sell
discounted comic books as a way to raise much-needed cash. Mr.
Dudas told a story with each comic, selling 90% of available books
and pulling in $3,000.
"If you bought a book, it was a donation, kind of like at a
telethon," he said. Within about an hour-and-a-half, he earned
enough to pay those two staffers for weeks to come.
This story reflects other tales I've encountered in recent weeks
editing the Journal's "Making It Work" series.
I'm working on stories about small auto suppliers using a
private Facebook group to collaborate on ventilator production; a
cabaret dancer taking her stage show to Instagram Stories. Last
week, we told how a British businesswoman used her page to show
parents how to use the cloth diapers she produces. Yoga
instructors, guitar teachers and hair stylists have said Facebook
is helping them make money.
Ms. Sandberg called me primarily to discuss a $100 million
rescue fund Facebook will be doling out to small businesses all
over the world in coming weeks, mostly in the form of no-strings
cash grants. The company has created a new fundraising tool for
small businesses, which operates much like a GoFundMe campaign, and
made a way for companies to sell digital gift cards. Its new
"Business Resource Hub" is far more used than Facebook's
traditional business home page.
The $100 million grant pales in comparison to a government
stimulus plan, but dwarfs some of the relief efforts set up by
other tech companies and many cities. Facebook will spend $40
million of that in the U.S., focused on small businesses located
near 34 cities where it has operations.
"We have a huge responsibility," Ms. Sandberg said. I asked her
why the company doesn't just offer lower advertising rates for
small businesses, and she said such an offer wouldn't most
effectively meet a business owner's needs.
"They need money," she said, adding that reduced ad rates would
certainly be less expensive for the company. More than a
half-million business owners have sent inquiries since Facebook
announced the program last month. Applications will be accepted
starting this week.
In our odd cloistered existence, businesses large and small are
searching for answers. For small businesspeople like Mr. Dudas, the
question is decidedly existential.
"No one's worried right now about Walmart or Target," he said.
"They're worried about us."
So, for now, desperate to connect, small business trusts in
Facebook.
Write to John D. Stoll at john.stoll@wsj.com
(END) Dow Jones Newswires
April 05, 2020 15:36 ET (19:36 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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