The usage of social network services such as Face-book is on the rise. But can firm performance be linked to the use of Facebook as a marketing and networking tool? Analyzing data on 1,971 firms, we show that the activity on Facebook by the owner of a micro or small enterprise in the German crafts business sector has a positive impact on firm per-formance. Applying the approach on marketing capabilities to the case of Facebook, we can link marketing capabilities (in the context of Facebook) directly to firm success. Facebook marketing capa-bilities turn into a valuable key factor for micro and small enterprises to outperform their competitors and provide superior value to customers. Further-more, we investigate online social capital and so-cial interaction on Facebook.