Facebook Sets High Asking Price for Log-Out Ads: $700K a Day

Seeks to Tap Big Display Dollars on Eve of IPO

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Facebook's new log-out ads are big, splashy and the closest thing to a traditional banner ad the social network has ever produced. They're also pricey -- similar to what it would cost to buy Yahoo, YouTube or MSN's home page.

Facebook log-out ad
Facebook log-out ad

Facebook's initial asking price for a marketer looking to buy all log-out page inventory in the U.S. for a given day was north of $700,000, according to a source briefed on the product before it was officially unveiled last month. That puts the unit in the same league as the web's most expensive display properties.

Log-out ads aren't available as a stand-alone purchase but are bundled with premium home-page ads that users see on their news feeds. The one-day ask to own the log-out page in the U.S. was $550,000 for home-page ads, plus $160,000 for the log-out inventory.

The new ads represent a marked departure from Facebook's classic advertising approach, centered on small display units that can be targeted based on demographic data and a user's interests and likes. Facebook doesn't even call them ads but "stories." Yet the log-out unit is a play for traditional display dollars and puts Facebook in more direct competition with Yahoo, AOL, Microsoft and Google.

While Facebook has tried to condition advertisers to take a more social approach, the log-out is a shotgun for those looking for the most reach and frequency as quickly as possible. (They can be targeted only by age and gender, according to Facebook.)

But reach of the log-out ads is limited to the number of users who actually log out -- a subset of Facebook's U.S. audience. When announcing log-out ads last month at the fMC conference for marketers, company executives said that 37 million U.S. users log out daily. Yahoo had nearly 40 million daily unique visitors to its home page in February (173 million unique visitors overall).

Despite the steep pricing, a few marketers have taken the plunge. Bing was the first to run an ad, on March 1, the day after they were announced, reflecting the close relationship between Facebook and Microsoft. Its ad featured a reproduction of the Bing search box that users could actually type search queries into and be redirected to Bing results.

Video-enabled log-out ads for Ford Mustang with the latest spot promoting the car and for the "Titanic" re-release with the movie trailer have also cropped up in the past month. Those two were page-post ads built out of content posted to the advertisers' fan pages and also showed how many times the videos had been liked, commented on and shared.

Facebook declined to comment on the price structure of log-out ads.

While Facebook's asking tab for log-out ads is comparable to portal prices, OMD Director-Social Media Colin Sutton said he sees them as different products. First, the scale is unproved, and little is known about when and why people log out of Facebook. Some are probably at work or using a shared computer. Others are leaving the web altogether, meaning not as receptive to calls to action as someone first landing at a portal.

"We definitely look forward to testing them to see if the results will be the proof," said Mr. Sutton, adding that he could see placing a client like Monster.com there. "In the mindset of a consumer when they get to a home page of a portal -- they're just getting into an experience, and we're about to interrupt it, so the message we put there has to be great."

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