Facebook's Daily Active Users Is Not What Matters

Fast Company:

Judging Facebook's advertising revenue potential based on mass audience numbers, then, misses the fact that brands don't advertise on Facebook the way they do in other media, like TV or print. Conventionally, bigger has been better, because marketers haven't had an efficient way to place brand advertising in front of the specific audiences they cared about. So, instead, they looked for "reach," seeking to buy up the largest possible audience. While they knew that only a sliver of those eyeballs would actually respond to their ads, the bigger the initial audience was, the bigger their sliver would be.

In the new world, however, brand advertisers can order up exactly the audience they're looking for. "It's not like when you buy an ad on Facebook, it runs across all users," Matt Lawson, vice president of marketing for Marin Software, which places ads on Facebook, tells Fast Company. Instead, advertisers specify the specific people they want to see their ad--men aged 45 to 55 in Michigan who like NASCAR, for example, or women aged 25 to 40 on the eastern seaboard with at least one child.

In this world, once you've reached the scale of Facebook, size just doesn't matter anymore.