Facebook continues to grow in popularity with small business to the point where it’s no longer a matter of if you should be utilizing this platform as how. It’s really no surprise to me that Facebook is generally deemed more useful for the small business than other social media tools, such as twitter. The Facebook platform and applications are such that a business could feasibly build their entire web presence there – particularly now that Fan pages can be viewed publicly by non Facebook users.

So, the question I want to dive into today is this: What’s the best way to approach Facebook for your business?

Of course, I’m not entirely sure there’s one correct answer, so I’ll outline three approaches that might make sense.

1) Facebook Business Account only

Business accounts are designed for individuals who only want to use the site to administer Pages and their ad campaigns. A Facebook Business Account allows you to create a simple business presence by creating public business pages, but you have limited access to the profiles of people who interact with or fan you page as well as little access to other features on the site. (Note: If you already have a personal profile account this option is not available)

Here’s the Help Center FAQs on Business Accounts. This can be a decent option for people who don’t want to do anything more than create a presence on Facebook. If you do not already have a Facebook personal profile you simply create a page or ad here. Once you create a Facebook page via business account you will always have the opportunity to convert it and create a personal profile.

2) Personal Profile for Personal and Business Fan Page for Business

Some people created a personal profile because they realized what a great tool Facebook is for keeping up with college and high school friends or sharing details about life with family and friends. When these same folks started realizing what a nice tool Facebook is for business, they faced the issue of mixing too much personal with business and visa versa.

For these folks the addition of a Facebook Fan Page is the most obvious solution. The Fan Page allows you to create a business only page with a great deal of functionality and settings that allow you to open your page up to the world far beyond your current Facebook friends. In addition, your updates and posts on your fan page spread to the wall of all those who become a fan on your page making your business presence even greater.

Of course, the way Facebook is set up there is still a very close relationship between your personal profile and the fan pages you administer. In this case, privacy settings on your personal profile probably become very important. You can visit your Facebook Profile Privacy Settings to make updates

Consider these privacy tips for business use:
a) Use the “Friend List” feature - This feature allows you to make lists to group people based on how or why you know them – family in one group, business contacts in another, cooking club in another, etc. The main reason this is so important is that you can issue different privacy settings per list and therefor be very selective about, for instance, what your business related contact might see.

b) turn off photo tagging – an often used feature on Facebook is to tag photos with the people in them. If you don’t want all your business contacts to see you kicking back with a few beers than make sure photo tagging is limited in your privacy settings.

c) protect your photos – change the settings on your photo privacy (a separate page) so that your darling two year old’s birthday pics are kept in the family – unless of course you want to share them with business contacts.

d) don’t share who your friends are – even before someone becomes a friend they can, by default, see who you are friends with, just without any details. You don’t have to make this information public and there might be some good reasons in this case not to. You can change your profile setting called Friends to show select groups of none at all.

e) choose who can see contact info – many people put personal contact details in their personal profile and as your business use increases and your start approving people you don’t know, you may not want them to have your personal email and mobile number.

f) control your wall settings – it’s a good idea to control who can view posts to your personal wall. If you allow your good friends to add comments, photos and updates, you may not want the business contacts to view this – change who can see wall posts from friends using the lists you build by visiting your profile settings page. You can also control who can post to your wall page, but this shouldn’t be a big issue if you control who can see posts. Of course you can also ban individuals from posting.

3) Personal Profile for Business and Fan Page for Business – when I started using Facebook my intent for strictly for business. (To my knowledge there are no pictures of me in hula skirts on my personal profile.) When Fan pages came along it became clear that this was also a great business tool so I added that as well.

I think this approach of all business is fine way to take advantage of all that Facebook offers to those who choose to use this platform.

My personal profile is open and public and I welcome friend requests from people who see this as a business page. I don’t reach out to family members and don’t have friend requests sitting in my daughters in boxes. I business stream content into my personal page, including my twitter, friendfeed and blog posts. These streams create a fair amount of interaction with friends, which I try to participate in.

I use the Fan Page to create additional awareness, answer questions, post video and publish events, including audio and video archives from those events.

Without question 2005 was the year of MySpace.  Before Rupert Murdoch’s $580 million social networking venture took the interactive world by storm, it’s difficult to believe that even the most optimistic of the billionaire’s lackeys would have predicted that new acquisition would more than quadruple its reach within a matter of months.  With 23.5 billion page views by February, MySpace became the second most trafficked site on the Internet.

Murdoch’s success naturally generated buying interest in anything deemed online social networking.  One proposed deal in March 2006, was Viacom’s unsuccessful $750 million bid for Facebook.com, the phenomenon started by wunderkind Mark Zuckerberg.  After Facebook.com declined the offer, its founders pegged Facebook.com’s worth at two billion dollars.  Perhaps the brilliant sparks from MySpace’s success has blinded Facebook.com to the flipside reality of Friendster’s paradise lost.  There’s a real chance Facebook won’t see an offer this generous again.

Facebook.com is essentially an online medium of communication for college students and high schoolers.  For its valued reach Zuckerberg and his crew of Harvard dropouts (taking their cue from Bill Gates, no doubt) must be looking for Google-sized compensation, but the two billion dollar figure is arbitrary and difficult to justify.  Perhaps Facebook is emboldened by their own wise decision in not selling to Yahoo for $15 million in 2004.

Zuckerberg was likely trying to establish a market value for his creation, not an unwise move on the face of things.  However, Viacom’s offer was not by any stretch of the imagination pocket change and the number of entities that can and will double the bid Facebook already got is finite.

Facebook’s traffic numbers, as referenced on Alexa.com, during the last three months are not encouraging; that is, if the goal is to fish for more and greater buyout bids.  The numbers actually have trended downward since March, anathema for enticing hyper bidding growth.  These diminishing statistics can be at least partially attributed to the cyclical nature of the school year since Facebook, after all, is geared towards the college student.  It doesn’t matter how great the product is, it won’t keep students from doing their own thing during summer vacation and this yearly dip is potentially damaging.

Seeing as how fast online fads can expand and contract in social networking as we’ve seen in its short time span, what if the numbers don’t come back?  What if something new pops up in two months that steals Facebook’s thunder?  (And, again, MySpace’s success serves as good reason why this thunder is worth stealing.)

Facebook.com’s success has also been marred with some controversy that could taint its popularity with students.  At Syracuse University a flap over freedom of expression ensued when a Facebook.com group went overboard in critiquing a student teacher and ended up with expulsions from the class and social suspension before three students transferred.  After Penn State’s football team beat Ohio State this year students rushed the field and made a ruckus.  Overwhelmed police made only two arrests that day, but later in the week they logged onto Facebook.com and, like Canadian Mounties who always get their man, got plenty of names and faces and photos from the info posted by students about their on-field shenanigans.  Kids talk and these stories spread like wildfire, which may affect Facebook.com negatively – they can’t control misuse of their product and the negative repercussions that come from it.

The future is promising for the social networking business space and I don’t believe Facebook.com is doomed.  Still, given the nature of short-lived and over-hyped dotcoms, Facebook may have reached their growth climax this school year, with possibility for expansion and success only contingent on acquisition.  Time may not be on their side because as the pages of the calendar turn there will doubtlessly be new fads and trends that will threaten to make something else the “Next Big Thing” at Facebook.com’s expense.   The clock is ticking.