Facebook Starts Automating Home-Page Ad Buying

Premium Ads Now Available Through Third-Party Sellers

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Two months after announcing it would automate the buying of premium ads that appear on user home pages and in their news feeds, Facebook has opened the floodgates.

Starting today, Facebook will make premium inventory available through its self-serve Power Editor tool and to third-party Facebook ad sellers like Blinq Media, TBG Digital and AdParlor. These "premium ads" are the ones that appear on the right rail of a user's news feed as opposed to a users' profile page. It's considered prime ad real estate because that 's where user's spend most of their time.

Until now those "premium" display ads had only been available through the Facebook sales team and with a minimum-buy commitment. But Facebook is removing that requirement so no such commitment will be necessary when the inventory is bought through an Ads API partner, but Facebook will retain final approval over ads that are displayed there. But because the ads will be available to more advertisers, the move could ultimately democratize a field dominated by big brands.

Premium inventory will continue to be priced at a fixed CPM, unlike the marketplace ads appearing on user-profile and photo pages that the Ads API partners have built their businesses around, which are sold in a bidded auction on a CPM or CPC basis.

Facebook has recently been on a roll with delegating more actual sales to third-party sellers. It announced last month that it would begin automating mobile-ad buying, which was perceived as a way to make mobile ads -- a key growth area for Facebook -- available to a bigger pool of advertisers.

Inexpensive marketplace ads are widely seen as a vehicle for direct-response advertisers to drive conversions, such as downloads of an app or click-throughs to a website, while premium ads have been billed by Facebook as a branding mechanism that are ideal for driving awareness for tentpole events or holiday promotions.

Blinq Media CEO Dave Williams expects that paradigm to remain in place, but he says delegating the execution of premium buys to third-party sellers will make them more effective, since the API partner can apply learnings about targeting and ad creative from an advertiser's marketplace campaign and integrate those efforts. As of now, advertisers who want to buy premium through Blinq must apply to Facebook, he said, which signifies the social network's intention to retain control over the marketers who can place highly visible home-page ads.

"It just gives the advertiser a lot more control in terms of what they're doing holistically on Facebook," said Mr. Williams.

Reducing the barrier to entry could have the result of making premium ads more popular. Blinq client 22squared's senior VP-director of earned and emerging media, Chris Tuff, said he's seen the minimum spending requirement for premium set anywhere from $35,000 to $50,000, which put it beyond the reach of smaller brands and local advertisers. Other carrots to lure advertisers to buy more premium are better customer support and better optimization, he said.

"There's [been] no efficiencies using the optimization and targeting from the billions of impressions on marketplace," he said.

While delegating the selling of premium to third parties means less control for Facebook, it also means teaming up with a sales force that has proved itself to be a key ally in preaching the gospel of its ad products.

"It helps them because their API partners have been really successful with coming up with ways to deliver targeted advertising on Facebook, and they've also created interesting metrics," said Debra Aho Williamson, principal analyst at eMarketer. "So by offering the ability to buy premium inventory using this infrastructure it just gives advertisers a better feel for what they're paying and what they're getting in return."

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