‘Sponsored Stories’ (or veiled ads) Now To Be A Part Of Your Facebook News Feed

Right from the onset Facebook has been cautious in their advertisement strategy. Facebook, as an advertising platform, has immense potential, given that now the social networking giant boasts of more than 800 million users. Facebook has so far limited ads to the right hand column of the page, but even then the ads were more often than not relevant to the user. For an ad to appear on the page it depended on how the user’s friends had previously interacted with the brand or organization and was directly or indirectly endorsed by them.

Coming January 2012 there will a major change in Facebook’s advertising/marketing strategy. ‘Sponsored Stories’ or sponsored ads will appear directly in the user’s news feed.

The other dynamics deciding ‘Which ad should appear?’ will remain the same. There are concerns that this move will amount to intrusion of the user’s space. For brands this will translate into a great opportunity to better engage with consumer. A spurt is expected in the marketing activities on the social media platform. Keeping in mind that user’s may not like such an intrusion of their news feed’s, Facebook has decided to gradually rollout their new ad product. Initially only one sponsored ad will appear in the news feed per day. It will be identical to a normal update, with one difference. A link reading ‘Sponsored’ will appear below the ad.

Communication and branding experts believe that this move will not affect a user’s Facebook experience and at the same time provide brands with the perfect opportunity to turn ‘fans’ into ‘friends’. They say Facebook’s advertising strategy has always been customized to the user experience and it will be the same in case of sponsored ads. In fact some have even said that most users will not even be able to distinguish between a normal update and a sponsored ad (that maybe stretching it a bit too far, but basically what they mean is that the ads will be non-intrusive).

We mentioned earlier that these sponsored ads will be in some way validated by the user’s friends and so will be relevant to the user. Here we need to stop and think for a minute.

How many of ‘friends’ we have on Facebook are ‘real friends’? Out of the hundreds of Facebook friend’s, for most users, only a handful are ‘real friends’. Friends whose opinion we value and whose endorsement we seek. So, our news feed’s are already cluttered with a lot of opinions, endorsement, likes, etc which we neither pay any heed to or are extremely disgruntled about. Sponsored ads will add to the chaos and can potentially have a negative impact on the brand first and possibly on Facebook as well.

This is not the first time that Facebook has decided to include sponsored content in the news feed. For a two year period between 2006 and 2008 Facebook had allowed advertisers to pay to get certain content featured in a user’s news feed. They discontinued the service in 2008 saying that unless the content can ‘naturally’ appear in the news feed an advertiser should be able to pay to get it featured there. Now Facebook has enough data about ‘us’ to be enable brand messages to appear naturally in out news feed.

Facebook introduced sponsored ads into the Ticker in the first half of 2011 and based on the response have decided to invade the news feed as well. A story on Inside Facebook illustrates why this move made sense to Facebook. Sponsored ads have a 46% higher click through rate (CTR) than the normal ads and it also amounts to 18% lower costs per fan. What remains to be seen is how it works out in the long run. How long will Facebook restrict sponsored ads to one post per day? Indian brands are not big on consumer engagement. Very few actually spend money on improving engagement and interaction through Facebook. So even tough sponsored ads will appear in the news feed, will the users be able to absorb the content meaningfully?

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