jump to navigation

Facebook’s engagement ads could be the standard we need for social media advertising November 11, 2008

Posted by jeremyliew in advertising, engagement, social media, social networks.
trackback

The WSJ today notes that Facebook lags Myspace substantially in ad sales, despite having surpassed MySpace in usage:

mk-as886_facebo_ns_20081110203632

[Facebook] … says 70 of the U.S.’s 100 largest advertisers have advertised on its site since 2007. But its share of total number of U.S. online display ad views was just 1.1%, according to market research firm comScore Inc., in its most recent report in June.

News Corp.’s Fox Interactive Media Unit, which includes rival MySpace.com, is the market leader with 15.9% of display-ad spending, according to comScore.

I believe that this is because most of the ads the Facebook sells are not standard units, unlike most of the ads that MySpace sells. As I’ve mentioned before, new forms of advertising are hard.

However, I am excited about the new engagement ads that Facebook is now selling:

The Palo Alto, Calif., company is rolling out a new ad format called “engagement ads” that further blurs the line between marketing and social networking.

The new ads appear on the main screen when a person first logs in to Facebook. They prompt a user to do something within the ad, such as comment on a movie trailer or RSVP for the season finale of a TV show.

This could be the first move towards a new standard for social media advertising. As I said previously:

The thing that differentiates social media sites from other forms of online media is not just user generated content, it is also that users are willing to affiliate themselves with brands. This takes many forms, from friending Scion on Myspace to putting a Natasha Bedingfield style on your Rockyou photo slideshow, to buying one of your Top Friends a Vitamin Water. These willing user affiliations/endorsements of brands are clearly valuable to marketers of those brands. Right now though, these deals are being negotiated on a one off basis; they look more like business development deals than selling ads off of a rate card. It will take a while for the social media industry to establish standards for selling this incredibly valuable inventory to brands, but I suspect that this will happen over the next 12-36 months.

Facebook’s engagement ads are potentially the first step towards defining what the ad unit will be (prompting a user to take an action that affiliates themselves with a brand). Flixster has had good success with this concept in many of its campaigns with movie studios. I think this concept could well be the basis for a new standard unit for social media, and I hope that the rest of the industry gets behind it.

Comments»

1. Revenue search continues, as Facebook (and LinkedIn) employee stock sale begins » VentureBeat - November 12, 2008

[…] success with running such interactive “engagement” campaigns with movie studios, says Jeremy Liew at Lightspeed […]

2. william - November 12, 2008

I think that this type ad/interruption will not work well.
Real “Conversations” have value and the ads/interruptions of the conversations do not.

For years we watched commercials/ads/interruptions on our televisions because we had no easy way to escape them. As soon as the technology arrived that allowed us go around the interruption arrived we used it, and there is no going back.

We now want real conversations; and we understand the difference between an “engagement” and something that is real and of value.

3. Google’s three new patents to improve targeting in social media « Lightspeed Venture Partners Blog - December 15, 2008

[…] charging for actions rather than using targeting to lift CPMs within display advertising. I think engagement ads could be a very interesting approach that takes advantage of the native behavior of “user affiliation” withing social […]


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: