Posts Tagged ‘Facebook Revenue Ads’

March 4th, 2010

Ads Posted on Facebook Strike Some as Off-Key

SAN FRANCISCO — Facebook, the world’s biggest social network, is selling more ad spots to big companies like Wal-Mart Stores, Procter & Gamble and PepsiCo.

Eddie Izzard fans got an ad about testing an Apple iPad. Another offered to show viewers how their child by a celebrity would look.

But the site’s pages are also home to countless ads from smaller companies that can be funny, weird or just plain creepy — those suggesting you are, say, eligible to get a free iPad because you are exactly 26 years old, or entreaties to see what your offspring would look like if you had a child with a celebrity.

Odd Web ads, like the dancing women promoting mortgage brokers, are not new. But on social networks like Facebook, where people go to communicate with one another, advertisers seem to be trying especially hard to intrude on the conversation.

The so-called self-service ads on the site, from the likes of video game start-ups, herbal supplement makers, sweepstakes companies and wedding photographers, are shown on the right side of most pages. Many advertisers who use the self-service system are tempted to go as far as possible in making ads that attract attention and appear relevant, aided by the information that people give to Facebook.

“When it works, it’s amazingly impactful, but when it doesn’t work, it’s not only creepy but off-putting,” said Tim Hanlon, a principal at the consulting firm Riverview Lane Associates of Chicago. “What a marketer might think is endearing, by knowing a little bit about you, actually crosses the line pretty easily.”

One campaign that flooded the site in recent weeks, before Facebook cracked down on it, tries to take advantage of consumer interest in Apple’s iPad. “Are you a fan of Eddie Izzard? We need 100 music and movie lovers to test and KEEP the new Apple iPad,” one version of the ad says. Louis Allred Jr., 29, a Facebook user in Los Angeles who saw the ad, said he figured it was shown to him because he or a friend had expressed enthusiasm for Mr. Izzard, a British comedian, on their profiles.

“It doesn’t seem like they are using the information in sensible ways,” Mr. Allred said.

Mr. Allred was also skeptical about the test-an-iPad offer. The ad sends people to Prize-Rewards.net, a site that appears to be based in Vancouver, Canada, and tries to get people to pursue rewards by signing up for memberships in services like Netflix. Efforts to reach the company were unsuccessful.

Dan Rose, vice president for business development at Facebook, compared the company’s self-service ad platform to the early versions of Google’s highly profitable AdWords system. He predicted that the quality of the promotional messages on the site would improve as more companies began to use it.

“A year ago, we had lower-quality ads, and a year from now we will have higher-quality ads,” Mr. Rose said. “It’s early, but we have made a lot of progress.”

The self-service ad system offers any person or company the opportunity to quickly design an ad and aim it toward finely segmented groups of Facebook’s 400 million members, based on gender, age, location and preferences like favorite movies and activities.

For example, a promoter can advertise tickets to a band’s concert to the select group of Facebook users who live in the area and have mentioned that band on their profile page or status updates. Or a wedding photographer can show ads only to people in a certain city who have switched their relationship status to “engaged.”

“I’ve had good success with it on a limited budget,” said Carter Rose, a wedding photographer in Dallas who has paid $1,700 for Facebook ads over the last few months and as a result booked three weddings at $3,500 each.

Many advertisers view a site like Facebook as a good place for playful messages. Cordarounds, a San Francisco pants company, talks about “pigeon matadors” and “trouserbots” that make pants in a “zero-G environment” to capture attention for its products on Facebook.

“It’s a conversational medium. If you can be the originator of that conversation, you are fitting in,” said Chris Lindland, the company’s chief executive, who uses Facebook to advertise solely to young men in the 20 largest urban areas.

From the perspective of many users, the tailored ads can often seem, at best, presumptuous.

Women who change their status to “engaged” on Facebook to share the news with their friends, for example, report seeing a flood of advertisements for services and products like wedding photographers, skin treatments and weight-loss regimens.

Then there are the nonsensical ads, which highlight the fact that Facebook does not have employees to review each ad, but relies largely on member feedback to flag inappropriate messages. That allows ads to slip through that run afoul of the company’s policies. “Laws now allow U.S. residents to reduce their credit card debt by more than 50 percent,” reads one ad for a debt-relief Web site, which is accompanied by a surreal image of four tiny babies lying in the palm of a hand.

“It caught my eye, but it sure didn’t win my trust,” said Paige Kobert, 32, an advertising employee from San Francisco who saw the ad recently. “It just seemed like a scam.”

A Facebook spokesman, Brandon McCormick, said ads like that one and the Eddie Izzard iPad ad violated a Facebook policy that requires the text and photo in the ad to be related to what is being advertised.

Mr. McCormick said that in the last few weeks, Facebook had begun enforcing that provision after users complained about the flood of ads aimed at alumni from a certain university or people of a certain age (“Hey, 32-Year-Olds”), with messages that had nothing to do with those characteristics.

Such ads are the equivalent of a direct mail “special offer for John Smith” that turns out to be not so special.

Facebook users seem most perplexed when they are left wondering why they have received a customized ad.

Jess Walker, 22, from central Florida, was recently presented an ad for Plan B, the morning-after pill.

“What do I have on my Facebook page that would lead them to believe I would need that?” she asked, adding that she did not want her sexual behavior called into question.

Ms. Walker noted that Facebook allowed her to delete the ad from the page she was viewing. — which would then make Facebook less likely to allow that particular ad to be sent to other people.

Mr. Rose from Facebook said the ads on the site were becoming more professional and straightforward as the company updated its policies and enforced them.

“When you have got the platform that we have, you are naturally going to attract people who are going to game it,” Mr. Rose said.

February 9th, 2010

Facebook Removes Microsoft Banner Ads From Site

Facebook is taking full control of display ads on the world’s No. 1 social networking website, cutting short an exclusive deal that had allowed Microsoft Corp to manage part of that business.

However, Microsoft – the exclusive provider of Web search on Facebook – will continue to sell text-based search ads on the website as the partners extended the arrangement beyond 2011, when it had been due to expire. A Facebook spokesman declined to say how long the deal has been extended. Microsoft also said it will further integrate its Bing search engine into Facebook while expanding its reach beyond the United States.

Facebook, which counts nearly 400 million users, said its own display ads feature interactive aspects and can target viewers based on their personal information, making them better suited to its social networking service than Microsoft’s standard Web banner ads. “Ad formats that feature social actions perform better and provide a better user experience since they are more consistent with the look and feel of Facebook,” the company said in a statement. “This combination of targeting and social relevance is the primary driver behind the shift in strategy.” Facebook said it stopped displaying Microsoft banner ads in some international markets recently, and following additional talks with Microsoft, has agreed to stop running the banner ads across all of Facebook. The change will take place over the next 30 days. Facebook has long sold its own display ads on users’ profile pages and other parts of the site, but the company allowed Microsoft to sell banner ads in certain sections of its website in 2006. The deal, which was extended in 2007, was supposed to run until 2011.

A Facebook spokesperson would not provide details on whether the advertising deal with Microsoft entailed any revenue sharing agreement, or whether Facebook would pay Microsoft a fee for altering the deal early. The news comes as Facebook has increased its focus on its financial performance. In September, Facebook said it had become free cash flow positive – meaning that the company makes enough money to cover the costs associated with running the service — ahead of schedule. Microsoft said on its corporate blog on Friday that Web searches within Facebook will bring up information from Bing beyond just links to websites. Microsoft’s search technology will be available on Facebook worldwide, instead of just the United States, it added. Facebook, which lets users connect and share information with friends online, has emerged as one of the Internet’s most popular destinations and is increasingly challenging the Web’s established powerhouses like Yahoo Inc and Google Inc. Microsoft invested $240 million in Facebook for a 1.6 percent stake in the company in October 2007. On Thursday, Facebook said it expected to reach 400 million active users of its site within the week, representing a gain of 50 million new users since December. The company also announced a new design to its homepage.