Just a few weeks after Facebook gave us the beautiful new uncluttered news feed, the social network is starting a test to introduce Facebook Exchange ads right in the middle of that wonderful simplicity.
Yup, real ads, not social ads. Retargeted ads: ads from vendors who have noticed where you surf and what you search for, and are presenting ads for products that, based on those actions, they think you might want.
“The owned, earned, and paid media sides of Facebook are coming together really quickly,” says Rob Leathern, CEO of digital ad agency and Facebook API partner Optimal. “This is a great opportunity to reach people within the news feed.”
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The new ads aren’t promoted posts, and they’re not native ads. Nor are they ads based on what you’ve liked, posted about, or done on Facebook. Rather, they’re ads straight from marketers who are targeting you based on your browsing interests.
Facebook previously allowed ads like this on the right side of the Facebook page, but this is their first foray into the news feed. There’s a good reason why:
“Allowing advertisers to reach people in News Feed is important because people spend more time in News Feed than any other part of Facebook,” Facebook posted today.
Leathern agrees, saying that it’s great news for marketers. “We see much better performance of News Feed ads. They get a lot more user attention,” he told me today. “Certainly they come at a higher price point.”
That’s fairly simple, of course: Advertisers want their ads where the people are.
So how will Facebook users react to this new form of advertising? Mobile Facebook users have already told me they’re less than impressed with the amount of advertising that has been showing up in Facebook apps relatively recently.
Facebook knows this, of course, so other ads will be toned down:
“Introducing Facebook Exchange in Desktop News Feed will not change the number of ads people see in their News Feeds,” Facebook added.
This is an important step in monetization for Facebook and an important step in its battle for ad dollars with Google. Social has not monetized as well as search, simply because social is about friends and communication, while search is about active intent. But by adding retargeted ads to the main news feed, Facebook gets intent “for free” essentially and is therefore theoretically able to monetize people’s attention in a social environment for products they might have been looking for in an individual environment 15 minutes earlier.
Another reason it’s a big step is that the new ad units will not necessarily link to brand pages on Facebook; they can link to landing pages outside of Facebook, something that ads in the news feed have never done before.
“It’s a clear signal that Facebook wants a very dynamic ad ecosystem,” Leathern says, adding that Facebook will inevitably fine-tune and tweak this particular ad unit for both advertisers’ and users’ benefit. “If there’s one thing Facebook does really well, it’s test and iterate products.”
VB’s research team is studying mobile user acquisition... Chime in here, and we’ll share the results.