Shares of Facebook (FB) are up 42 cents, or 1.6%, at $26.33 after BMO Capital’s Daniel Salmon raised his rating on the shares to Outperform from Underperform, and raised his price target to $32 from $15, writing that Facebook “has improved its outreach to Madison Avenue,” which could help its advertising efforts.
“We believe Facebook�s advertising platform is currently gaining momentum with both traditional brand advertisers and direct response (DR, including a lot of e-commerce) marketers,” writes Salmon, something he thinks may continue into the middle of next year.
He describes what he is hearing as a new tone from Facebook, citing remarks by Facebook veep Carolyn Everson in a recent AdWeek discussion, in which Everson observed, “We�ve been confusing at times . . . it�s been a concerted effort to actually start speaking more of the marketer�s language, as opposed to product-centric selling.”
Writes Salmon,
Through summer 2012, the majority of agency and brand executives we spoke with felt that Facebook wasn�t just confusing, but also arrogant and unbending; that opinion began shifting in the fall and has continued through the early winter. This is a similar evolution to that which happened at Google in 2007-08; Google now receives regular and consistent praise from the agency community. Facebook is getting there.
Along with that, Facebook is now focusing more than ever, he thinks, on so-called “native” advertising, that is, ads that accompany stuff people actually talk about on Facebook, such as birthdays — things that produce “quality engagement” that should be desirable to advertisers, he writes:
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