But this slight drop follows 17 months of consecutive growth. Facebook still has 8.5 million unique users and remains the most popular social networking website in the UK, according to Nielsen Online, the internet research company.

Having achieved critical mass, the online social network now presents a viable channel for businesses and brands to engage with their target markets.

The challenge is to figure out how best to leverage the complex network of relationships for commercial purposes without turning off the very individuals you are trying to reach.

A good place to dip your toe into Facebook waters would be the ad services introduced late last year.

Through Facebook Ads, people can now learn about new businesses, brands and products through the trusted referrals of their 'friends'. In fact more than 60 major consumer and internet brands are already using this new channel.

'Facebook Ads represents a completely new way of advertising online,' CEO Mark Zuckerberg said at the service's launch.

'For the last hundred years media has been pushed out to people, but now marketers are going to be a part of the conversation. And they're going to do this by using the social graph in the same way our users do.'

Facebook Ads had comprised three parts when it was launched: a way for businesses to build pages on Facebook, an ad system that facilitates the spread of brand messages virally and an interface to gather insights into people's activity on Facebook. One of these services has since been withdrawn.

Already there are more than 100,000 business Facebooks, representing some of the world's largest brands, local businesses, organisations and even bands, each allowing people to interact with organisations in the same way they interact with other Facebook users.

For individuals, their own page is the basis of how they use the network and building these pages is where businesses should start as well in crafting the exact experience they want people to have in relating to their brand or products.

Starting with a blank canvas, businesses add all the information and content they want, including photos, videos and music.

In addition there is a range of applications to enhance a Facebook page, such as booking reservations or providing reviews of restaurants and buying tickets for the cinema.

The viral component of Facebook lets advertisers capitalise on what's cool about social networks.

People can become a fan of a business and can share content and information about it with their friends. They act as a trusted referrer.

Then people will go on to interact directly with the business on its own Facebook by adding reviews, writing on that business' wall, uploading photos and in any other ways that you can conceive of. All these actions will appear in an individual's own feeds, which in turn shares company information with their friends.

These concepts are all in their infancy and as interest among advertisers grows, Facebook is also learning about what works and what offends their communities.

It didn't take long after the launch of Facebook Beacon, a service designed for organisations to allow their customers to share the transactions with their Facebook friends via personal feeds.

One gentleman was horrified, having bought a diamond ring online, to find the fact broadcast to his entire Facebook network, including the woman to whom he intended to propose. Outcry was fast and furious.

People felt Beacon put their privacy at risk. Facebook countered that the information was only broadcast to their trusted friends, so there was no breach of privacy. But the real heart of the problem was the lack of control for the individual.

Once Facebook took the decision of what gets broadcast out of the hands of users, they'd crossed a line. So they are back at the drawing board with Beacon. But I think the most interesting thing about Facebook marketing is the deep insight.

Facebook has a lot of information about its users. What they like, who they like, where they go, where they live, the list goes on and on.
Now advertisers can use this data to create highly targeted initiatives.


>>Sherrilynne Starkie is the managing partner of Strive Public Relations, a communications consultancy serving the Isle of Man. She provides her views on business and technology each week in Tech Talk. Visit her business blog Strive Notes for frequent updates.
www.strivepr.com