Warning: What You Need to Know About the New Facebook Ads

Last week Facebook announced a radical new direction for their entire advertising policy. Some have stated it's one of the most significant changes for advertisers and consumers in the internet age. We're going to explore what will be rolled out and some of the core and key implications for all parties; you the Facebook user, the advertisers and for Facebook itself.

In a nutshell, Facebook will make ads into conversations, and you'll be told which friends have already supported which brands and news messages. As FastCompany put it:

Facebook is making the new ads social by default... the new formats will draw their content exclusively from posts to brands' Facebook Pages, rather from advertising copy written independently

This is a clear shift away from traditional honed and tested copy to more natural and social content based advertising. They've already started working in this area with 'Sponsored Stories' for some time now but this is a whole new departure as they're phasing out almost all traditional ad formats from Wednesday 29th February. Essentially the thinking from the Facebook document is that "everything starts with great content...paid, owned and earned work seamlessly together".

All of these new developments were recently leaked and were first published by GigaOm and from there were published onto Scribd: (click 'Fullscreen' button below to View)

Facebook Premium Ads Guide

Facebook Premium Ads Overview

Why make these changes?

In a recent post on here, Why You Still Need a Website Not Just a Facebook Page,  we referred to an article which stated that Facebook banner ads perform about half as well as regular banner ads on other networks. With all the ferocious amounts of clutter added over the last few years to a previously clean and spacious interface, it's no wonder ads aren't getting noticed as much as they used to. They're physically taking up a smaller percentage of text and image sections on the page filled with more distractions. Ads generating lower click-throughs often mean lower conversions, both bad for the advertisers and bad for Facebook revenue. So it seems the powers that be in Facebook intended to do something dynamic with potentially massive impact on advertising success, while attempting to return user experience to previous levels.

Facebook was not invented to make money from advertising or for advertisers. It was invented for the ease of social interaction by the users. Oddly this new social ads or 'sponsored stories' fit much better and more appropriately into the earlier goals and founding ambitions of keeping the site low on advertising and more user focused.

The theory is the growth of content based advertising will seem less like advertising and so will be less intrusive. It will be relevant to your interests and conversations and slip more seamlessly into your news feed, or be more interactive with a Like, Share or Comment option in the traditional far right column, less distinctly separate from the rest of your page.

The Nuts & Bolts

  • Advertisers post content on their wall
  • Certain percentage (average 16%) of Fans see the brand's post in their news feed
  • Advertisers can pay to ensure more Fans (3-5 times more) have their ad post appear in their news feed
  • Advertisers can make their post appear as 'Sponsored Story' in the right hand column of Friends of Fans and target audience page
  • All traditional formats phasing out from February 29th. Advertisers can still use the traditional 'Premium Standard' Format, but the ad will not have social buttons and must link to an external site.

The Importance of Social in Advertising

Most of the new ads will also be heavy on using the power of social proof. You'll be told clearly how many of your friends and other users have Liked this post or this product, and you will be able to comment, like or share it, right there on the post, much like the post of any of your real friends or contacts. All of this results in a huge rise in engagement with ads and the doc above mentions "40 percent more engagement and 80 percent more likely to be remembered" that lead to prospects being "4 times more likely to purchase when people see friends interact with a brand".

So users should be pleased with more subtle and relevant ads, Facebook are happier as the user engagement rises and so the advertising success shoots up, meaning more revenue to placate their latest round of investors. But what about the advertisers? Things just got a lot tougher for some.

The Mechanics for Advertisers

All but one of the Google Adword styled creatives consisting of a brief headline,  135 characters and a small image or video will be scrapped. The Premium Like, Premium Event, Video Comment and Premium Poll formats are being removed. The one traditional format that will survive, known as the 'Premium Standard' format, will not feature a Like button or Comment box as it will only link to external sites. This means if you want to get more Likes for your fan page, you have to do it through compelling content.

It could become increasingly difficult and expensive to do traditional split-testing and incremental improvements with long running ads. To clarify, the old style market place ads usually down the right column of the page will still be there so this is not at all dead, just highly reduced in scope.  Most likely the costs will rise due to advertisers flooding their budgets into the only traditional format for ads left on Facebook. Only the most canny and tested advertisers will make a profit, but the relevancy and standard of ads for the consumer should go up. To reap the benefits advertisers will have to invest in better ad managers and better testing for the old style ads, and on the new format side, more quality content and greater interaction with their fans, which is not all a bad thing. The modern cliche of social media being about 'the conversation' is now all the more true. Good news for the exploding market of social media managers!

Advertisers will still be able to target prospects in all the ways they previously could. The user numbers for Facebook are 845 million, such a vast and attractive target that Facebook won't have to fear a mass advertiser exodus.

How momentous is this change?

Advertisers used to focus on feature-based selling, until Sigmund Freud's American nephew, Edward Bernays, introduced desire based selling in the 1920s. In his NewYork Times obituary he was referred to as "the father of public relations" and listed by life magazine as one of the 100 most influential Americans of the 20th century. This change occurred by combining aspects of his uncle's psychoanalysis with ideas of Gustav Le Bon on crowd psychology.  For example, no longer were clothes, cars or anything else advertised mostly on their endurance, reliability or ease of use, but for desire and emotional resonance. Wear it and you'll feel like this, or look like that, or be more attractive to the opposite sex and the envy of your own.

Facebook advertising changes are not as significant as the invention of PR, but not far off either. It could be said this is the most significant shift in advertising reality since Google introduced ads focused on exactly what people are searching for and made billions of dollars in only a few years. As the old format ads in the social arena of Facebook continue to loose effectiveness and advertisers get to grips with the new model, we'll see greater change. This is one of those moments when you see a whole industry tilt in a new direction, you get a glimpse of the future way of doing things, and in that arena nothing will ever be quite the same again.

 

 

 

About Alistair McBride

Al is the non-techie of the SelfAssemblySites' founding duo. His first businesses were in cultural tours, then later art dealing and consulting. He was SelfAssemblySites' first user and believes if he can do it, anyone can.

He has a wide and diverse range of interests and passions, core of which are usually art, psychology and innovation, and works on both profit and non-profit projects.

Alistair truly believes that a website can be a catalyst to making any idea reality in the 21st Century. You can create all sorts of non-profit and for profit projects take-off with a good website as your launch pad.

Follow him on Twitter at @WebsiteCoaching.

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