Facebook Takes People-Centric Ads to the Next Level

Welcome To A New Era Of Social Marketing, Where You Can Empower Your Fans To Be Your Ambassadors

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Mike Lazerow
Mike Lazerow
It may not have seemed like it, but Jan. 25 marked what will be seen as a new era of marketing -- an era dominated by people-centric advertising with real opt-in actions at the foundation.

That's when Facebook announced "Sponsored Stories," its first attempt to let marketers amplify the behavior their customers, potential customers and fans are taking on Facebook.

To be clear, the concept behind sponsored stories is not a new one. But the massive scale it provides is unprecedented.

For the past two years, Facebook has been testing its vision of an advertising marketplace based on people's relationships to each other, and not just contextual content adjacency (like portals and branded sites) or search terms (Google and Bing). When a Facebook user likes an ad that appears on the home page or on the right rail of the Facebook site, Facebook has given advertisers the option to add that information to the ad when a friend of that user is served the ad.

The result of this social context has been overwhelmingly positive for Buddy Media clients and other Facebook advertisers. A report released by Nielsen last year reported that this social layer increased purchase intent in the studied campaigns to 8% from 2% when the social context was absent.

The issue for the world's largest brands that care about tonnage -- aka reach, massive, massive reach -- is that the number of people who like an advertisement is limited. Liking an advertisement is not a natural behavior in the real world, let alone Facebook.

And therein lies the opportunity Facebook has addressed today. The number of likes of a Facebook page, comments on a Facebook page wall and other social-brand actions the 600 million users take as they use Facebook daily far, far outstrips the number of advertising interactions. So the new plan released by Facebook combines the positive results we're witnessing with social ads with a pool of inventory the size of which the world has never seen.

To give you an idea of the scope of this, Facebook users share 30 billion pieces of content monthly. More than 20 million people like a page daily. Those "likers" have an average of 150 friends, according to Facebook, meaning that the total target audience for the new ad unit is every one of the 600 million Facebook users. That is far more than just the number of people who like an ad on Facebook.

There are now four types of sponsored stories. I'm sure they will add more in future. All of these options will only be seen by your Facebook friends, who are already used to seeing your activity in their news feed. The four types are:

  • Likes: When people like something on your page, which can be used in an advertisement.
  • Wall Posts: Same goes for wall posts. Anything posted on a wall is open to be sponsored.
  • Check-ins: When people use Facebook Places to check in to a location, that information can be displayed in an advertisement. As Advertising Age noted, "If Starbucks buys a 'sponsored story' ad, the status of a user's friends who check into or like Starbucks will run twice: once in the user's news feed, and again as a paid ad for Starbucks."
  • Custom apps: Interactions taken on custom applications -- for example, taking a quiz or poll can be sponsored.

So what does this mean for you?

The launch of sponsored stories confirms the company's commitment to its page product. Three of the four initial triggers for sponsored stories are tied to your Facebook page. So now is the time to really focus on getting your Facebook house in order. If you have a current page but few fans, it's time to grow your fan base. If you have a page with a ton of fans and low engagement, it's time to jump-start the engagement.

To best take advantage of the new advertising products, you need as large a fan base as possible. Friends of your current customers are most likely your most profitable prospects. Likewise, friends of your fans are more likely than the average Facebook customer to fan your brand, and, over time, become a customer.

The number of fans is one metric for success. But the engagement of those fans -- the percentage who click, like, share, comment, send, vote and more -- has always been just as important, and now, with the launch of Sponsored Stories, even more important.

That being said, many times Facebook launches products and quickly changes them based on user feedback. I have no information to share about their plans with this. Whether this is the final form and function of their social-advertising product, there is no doubt that the future involves people at the center of marketing.

Welcome to the new era of scalable social marketing, where you can empower your customers to be your most successful brand ambassadors.

Michael Lazerow is CEO of Buddy Media, whose Facebook management system is used by global brands and agencies. He founded Golf.com and sold it to Time Inc., and U-Wire, which was sold to CBS. Follow him on Twitter at twitter.com/lazerow.
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