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Thursday, June 12, 2008
Just because a social network is popular doesn't mean it's so easy to monetize, as News Corp. found out after its purchase of MySpace. Analysts have tried to extend MySpace's trouble to other social networks while balking at Facebook's $15 billion valuation. But after speaking with Facebook's Kent Schoen about the social network's fairly precise ad targeting, skeptics could be won over.
Editor's Note: After all the social media marketing hype, it's good to see a concrete example of what advertisers can do with a social network. With targeting, it may seem less like fishing and more like archery...erm, computer archery, because real archery's hard. Does this change your mind about Facebook's value, or the value of social media in general? Yes or no, tell us in the comments section.
Schoen, who serves as Facebook's product marketing manager, gave WebProNews a tour of the recently launched Facebook Ads program. The advantage of social media marketing over search marketing, Schoen tells us, is the advertiser's ability to connect with consumers over a longer period of time and in a more meaningful, targeted way.
"We know we're going to see a person the next day or the day after," said Schoen, which is a far cry from the one-hit-wonder world of search. Or, if you're not looking for just anybody to click your ad—as is likely to happen in the broader search ad world—you can target Facebookers based upon their stated interests or associations. "We've targeted people who work at Oracle in the past," Schoen gives as an example.
Facebook Ads is an auction system similar to AdWords. Advertisers bid on keywords with a maximum daily budget, or they can bid on CPM basis as well for display ads. Ads, based on contextual relevancy, will appear in various places on the site: in member news feeds, along the side of pages on the site, on user photo pages, et cetera.
But also, advertisers can select their target audience, down to the pants they wear. Bonobos, for example, a high-end men's pant retailer, makes a $120 pair of royal blue slacks with a white belt any man with a discerning and caring significant other would prevent him from buying. But Bonobos isn't targeting that guy, they're targeting Cubs fans*.
When Bonobos set up their account, they were able to select the target geographic location (Illinois), age group, gender, and education level. All this information, of course, is available via Facebook profiles. They then targeted specific keywords like Cubs, Chicago Cubs, and Baseball.
As you can see, this is a bit more specific than the large net one has to cast into the vast search ocean. This kind of targeting can be enhanced, of course, with widgets advertisers can create for Facebook. Schoen uses a coffee shop as an example of a business creating a calendar of events for their own page, upon which Facebook users can sign up as "fans" of the business, which also extends the brand.
The next step beyond this type of audience targeting for Facebook, then, seems fairly obvious: behavioral targeting. Schoen said that while there were no specific plans currently on the table regarding behavioral targeting, Facebook was still considering behavioral options as part of their long-term strategy.
*No offense to Bonobos or Cubs fans. Just teasing. Please no angry comments. Had they been targeting Kentucky Wildcat fans, I would have, fairly, taken that shot, too. ;-)
About the Author:
Jason Lee Miller is a WebProNews editor and writer covering business and technology.
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