Advertising your updates

So Facebook have been testing some new ad concepts (see image).  The premise is that when someone mentions a brand in their status update, that update becomes a sponsored story which friends can then like it (or play a game – not sure how this works).

From initial tests the results look promising 46% higher CTR, 18% lower CPF (cost per fan) and 20% lower CPC.

There is logic to the shift to social ads – you pay more attention to it because it is your friends, it is personal to you rather than some random person. More attention will result in more clicks and all the above stats. I have issues with percentages, but I see two key flaws:

  • The interaction is with a friend’s status update, not a brand – in their mind it will be their friends’ status they are liking not the brand
  • It is still not helping brands create value from their fans – all the stats are showing is that you can get more eyes for cheaper… what you want is to get the right eyes even if they have to pay more for the privilege (how many brand managers would object to paying $1 more if they knew it would result in additional $5 revenue per recipient)

Facebook is clearly trying to use its advantage of being the social hub for many people however between them being social and being happy to be sold to or buying something there is still a long way to go.  But then again that’s not really Facebook’s problem.  Their role is to facilitate contacts. They’ve provided and created a platform to enable this, it’s now up to the brands to make it engaging and seamless enough for it to work.  Will they do it?  I have my doubts. I don’t think it is a selling/buying platform.

For Facebook, all they can do is open the door for brands to find people to talk to.  As they say ‘You can lead a horse to water but you can’t make him drink.’ or a version I favour slightly more ‘You can take a whore to culture, but you can’t make her think.’

What do you think of the opportunity these new ads bring?

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