Just last week I read an article entitled “Why Facebook Adspace is Worth Bupkis” (thanks to Scott Hale for sharing the article in his Google Reader). My first thought when reading the article was what is Bupkis and what exactly is it worth? But, using my context clue skills from back in the day, I figured out that “Bupkis” and Facebook ads are apparently worth very little, a CPM of 56 cents to be exact (compared to an Internet average of $2.43). The article explains that part of this is due to the high number of page views that is inherent in Facebook and other social networks. I’d also suspect that part of this is due to the ads being so easy to set up, there are a number of people using them that really don’t know what they’re doing, meaning their ads are very unsuccessful.
Still, this low number is somewhat concerning. It has dragged down the CPM of ads across the web by 20% for goodness sake!
Are you really that surprised, though? I’m not.
The Problem With Facebook’s Advertisements
Everyone always talks about how targeted Facebook’s ads are. You can segment them by age, university, marital status, religion, interests, etc. But let me tell you something, it doesn’t matter how relevant the ads are to someone’s interests! It has to be relevant to their interests AND presented to them at a time that they are interested in that interest. Not to mention, even if a user was interested in an ad, they won’t even see it half of the time since the right side of the page doesn’t get many eye balls.
For example, I love Mexican food, but if I’m at the movie theater watching Toy Story 3 and someone walks in the theater and yells, “Hey everyone, Qdoba is having a buy 1 get one half off special on burritos. Come and get it!” then I’m going to be pissed. Sure, that’s a good deal and I do love Qdoba burritos, but your telling me about them out of context.
That’s where Facebook is at a tremendous disadvantage compared to Google. Ads on Google are relevant both to your interests and contextually. You search for “mexican restaurants” and the sponsored results are actually mexican restaurants. The ads are unobtrusive and *gasp* actually helpful.
Facebook, on the other hand, isn’t contextually relevant when it comes to its ads and either goes unnoticed completely (because the ones you’ve seen in the past you weren’t interested in) or you notice it but don’t care at the time because you just want to see the scandalous pics that your friends uploaded from their crazy weekend at the beach.
Alternative Advertising Options for Facebook
But it’s not enough to just explain why Facebook’s ad model isn’t really successful. We need to examine alternative options for Zuckerberg and his crew. So, here are a couple ideas I had, be sure to share some of yours in the comments section:
- Make Ads Relevant Contextually - If I’m on a Fan Page for a golf related brand, why are you showing me ads for creating a website? Yes, web/digital type stuff is relevant to me, but not at this moment. I just saw a golf ad somewhere else, but now that I’m on a golf related page, it’s gone. Making the ads relevant both to fan pages that you’re on and searches you’re executing would make them much more relevant contextually.
- Integrate Ads into the Stream of Content – I will admit people probably would be pissed off about this initially, but, like everything else Facebook has done, give it a week or two and it will be water under the bridge. I’m picturing these ads to mainly appear in the news feed, which, unlike the right sidebar/margin, is the most valuable section on Facebook. The main thing I’d recommend here is making a much larger barrier to entry here to avoid some of the random advertisers and small websites out there from getting on here. Charge more and attract bigger brands for these ads so that they look more professional and less annoying.
- Sponsored Status Updates – Much like what Twitter is experimenting with, Facebook could offer certain big brands the ability to “Promote” a status update, which would appear as a sticky update at the top of Facebook users’ news feeds. It would help if these were targeted and would sure as heck get more eye balls than one that got lost in the news feed, therefore, you better believe brands would cough up the money for it.
- Allow More Ad Customization - As they stand right now, the ads are pretty bland and limiting for the advertisers. This does provide a nice uniformity across the site and prevents them from being too big of an eye sore, but may limit their effectiveness in cases. Another option would be to offer greater customization for one of the three ads that appear on most pages. For example, allow a customized background color and headline font. These would probably have to go through a review process before being posted, and as a result of all of this (and to create a higher barrier to entry once again) they would come at a premium price.
So what do you think? Good ideas? Would they piss you off as a Facebook user? What are some more alternatives?
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{ 2 comments… read them below or add one }
My thoughts exactly….I started my first campaign–and it bombed.
I’ll need a lot of tweaking and testing–and TIME if I want my facebook ads to work
I think you have some good ideas here. I really never click on Facebook Ads personally, but have actually been experimenting with posting some for a client project. So far it has had some decent results, i.e. clicks to the client website. I think having ads in the newsfeed is your strongest point. For example, since I’m a fan of “Sears” when they have a $10 off coupon, it appears in my newsfeed. In fact this happened today and I clicked on it. Having a *FEW* extremely relevant ads in this space could really work to promote someone’s product.