This weekend, the NY Times "Advertisers Face Hurdles On Social Networking Sites" reported that many advertisers, including behemoth Procter & Gamble, have had mixed success in social media. Reporter Randall Stross used Facebook ads as an example of social media that still distract people and end up with diminishing returns like many forms of advertising.
He quotes an expert: Mr. Goldstein of SocialMedia Networks describes a self-perpetuating cycle in social networks: “Advertisers distract users; users ignore advertisers; advertisers distract better; users ignore better.”
Advertisers that fail on Facebook or other social media aren't seeing it right. You cannot just do an ad campaign with limited scope, timeline and reach. You must see your engagement with real people on Facebook and other social media as just that- interaction with humans - that can and does occur 24/7/365.
I would never "Become a Fan" on Facebook of the New York Times article-referenced Tide campaign, "2x Ultra Tide Presents America's Favorite Stains" , I would, however, become, a Fan of Tide, if it were a product, brand or person I knew and loved. I am, therefore, a fan on Facebook of Dunkin' Donuts, Barack Obama, Foxwoods Casino, Banana Republic, Britney Spears, Weight Watchers, the New York Mets, the NY Times, and a few dozen others. So are millions of other people.
When advertisers start thinking like consumers and brand fans themselves and stop thinking like advertisers, not only will they get a lot more "fans" on Facebook- but they'll start seeing a lot more "return".