Using social data, Mr. Zuckerberg said, Facebook will "help you create some of the best ad campaigns you've ever built." He was onstage to unveil Facebook Ads, a system by which marketers can marry an ad message to a user-initiated endorsement of a product or service.
Sharing in the brand engagement
Tactically, it's not an easy concept to explain. The first part involves user-initiated recommendations of a brand: When people visit a business' Facebook page, they can choose to share their engagement with the brand (by becoming a "fan" or writing on the brand's "wall") with their peer network using a newsfeed or mini-feed. Facebook users can also share their interaction on a brand's own website through a program coined Beacon. For example, users can share with their network when they post an item for sale on eBay, rent a movie on Blockbuster.com or rate a book on Amazon.com.
The idea is that communication moves not from the brand to the consumer but from the consumer to his or her friends and family.
Then there's the actual paid-advertising part: Facebook will permit advertisers to attach an ad message to those user notifications. To do so, marketers make a Facebook ad buy targeting users by any number of traits users volunteer on their profiles, such as age, political leanings or interests and activities. Facebook will then serve up those ads -- fairly simple text-plus-graphic creative -- either without the social element or, if a friend has sent notification of a brand engagement, within that.
"We are putting advertising back in the hands of people," said Chamath Palihapitiya, VP-product marketing and operations, Facebook. He said it would create a system for user recommendations "so ads are less like ads and more like information and content."
Facebook is offering the Beacon placement and branded pages for free. In return, the social-networking site gains access to potentially valuable targeting data about what kinds of brands users interact with.
A Trojan Horse
"It's a brilliant Trojan Horse," said Mark Kingdon, CEO of Organic. Overall, he called the platform "a natural evolution, both advertiser-friendly and user-friendly."
Marketer reaction ranged from modest skepticism to major enthusiasm.
Jeffrey Glueck, chief marketing officer at Travelocity, which was a launch partner of Facebook's Social Ads platform, said he was excited about the opportunities, but he admitted his brand has an inherent social aspect to it.
"Travel is very social, people like to talk about travel, invite their friends ... and Facebook users like to share information with friends," he said.
James Warner, exec VP-Avenue A/ Razorfish East Region, said he liked the ability to linking a user action into an ad. "It's unique," he said, reservedly.
John Harrobin, senior VP-marketing and digital media at Verizon, was perhaps the most effusive, calling it exciting in the same way Google's launch of AdWords was exciting. The difference, he said, is Facebook's plan not only drives ads to those people who are in the bottom of the sales funnel but also the overall marketing effort.
"This lets us tap into the Facebook community's potential to drive results," he said.
But will consumers share?
Still, the service hinges on several things, not the least of which is users wanting to share their purchase behavior with friends. The targeting aspect assumes people honestly share their profile info. It also doesn't take into account what is happening in the offline world. (To hear Mr. Zuckerberg describe it, Facebook is the reflection of people's connections in the offline world.)
Rob Norman, CEO of Group M Interaction, blogged about the announcement and said it was encouraging concept but also posed a "massive challenge in reputation management and just one more destination to deal with in terms of driving the traffic with messaging that shapes opinion." He cautioned that clutter could become impenetrable, that people who share information about brands with friends might not actually like that being co-opted by advertisers; an easy slip up could, of course, broadcast something like a porn purchase to an entire social network.
There needs to be, he wrote, some "smart thinking about how to harvest the eggs without killing the golden goose."