Facebook Sponsored Stories & a Happy New Year

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Do you know what a sponsored story even is? As a marketer or advertiser, you notice the small differences in the different ad forms and platforms. A banner ad on a website is soooo much different from a site takeover or a sponsored tweet. But do consumers even recognize a difference? At the end of the day aren’t all advertisements, well, advertisements?

It seems as though Facebook has graciously answered that question for us – absolutely not, and especially not if your approach to advertising is user-friendly. A few months ago, Facebook added Sponsored Stories to the ticker feature on everyone’s “home” page (for more info about the new ticker click here). The Inside Facebook blog noted that this transition was a smooth one without much backlash.

So it seems only natural that Facebook would move forward and start placing these Sponsored Stories in users’ News Feeds. But, what’s a Sponsored Story anyway and how is it going to affect my experience as a Facebook user & my experience as a marketer?

If you have friends on Facebook, you probably have friends who “Like” a few brands and interact with a them on Facebook. So, it’s likely that you’ve seen an update in your news feed from time to time about “Charles Gibson” (for instance) commenting on the ABC World News Page. But, honestly how often do you see those sorts of updates? Probably not that often, and if you do, you probably ignore it.

Formerly, Sponsored Story ads were there to insure that some of these stories actually did show up as ads on the right hand side of your page. There’s an example of one of these ads on the right.

Starting in January, though, those ads will begin to surface in your news feed, looking something like this:

This might seem like a pretty lame way for Facebook to start out 2012, but there are some redeeming qualities for users. First, at least in the beginning, you’ll only ever see one sponsored story ad per day. Second, all Sponsored Stories will be marked as “sponsored,” and Facebook is smartly rolling out the program slowly to all of its more than 800 million active users.

Plus – think about it. It’s not a regular advertisement – it’s something your “friend” has already done or said. And in that sense, it could be engaging. The ads could be created around one of your friends liking Lady Gaga, checking-in to the Brooklyn Museum, or using Spotify – among other types of status updates. At least it’s not one of those random ads that you can’t relate to, right?

And for advertisers – this is going to be the help we need to continue to acquire more interaction among our followers and potential followers. The new Timeline feature has decreased the frequency and likelihood that your regular posts on Facebook will make it to your “fans” news feeds. Which means that brand pages must provide even more relevant content in order to successfully make it into a “Likers” news feed. This new Sponsored Story option gives advertisers a way to combat this. Now a brand might have a chance to make it into someone’s feed, without fighting Facebook’s unknown algorithm.

There are a few problems, though. First, you won’t be able to buy placement only in the news feed for Sponsored Stories. You’ll have to buy into them and cross your fingers that it ends up in the news feed. Facebook also hasn’t provided any pricing information just yet either.

It seems Facebook is playing a game of chess with us marketers and, so far, they’re coming out on top. eMarketer estimates that the addition of Sponsored Stories this year alone has increased Facebook’s global ad revenue in 2011 by 104.3 percent over 2010.

What do you think about Sponsored Stories? Yay or nay?

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