allfacebook - the unofficial facebook blog

I’ve said it a million times: the best way to make money with Facebook applications is through branded partnerships. Jeremiah Owyang has posted a case study about Sony using the Vampires application for generating buzz about their movie 30 days and 30 nights. The statistics are impressive yet not surprising considering the Vampires application is one of the top 30 applications on the platform.

Sony pictures was looking to have at least 10,000 users register for their sweepstakes in which a 4 wheel ATV was given out and $1500. The application ended up registering almost 60,000 users. This was way more than they expected to register and as a result the client was happy. So what are the suggestions that Jeremiah came up with after speaking with Rock You? Jeremiah came up with the following three things that worked:

1. Fishing where the fish are: Sony figured out where the already existing community was (remember to fish where the fish are) and rather than trying to rebuild something completely by scratch, they leveraged an existing successful application.
2. Rely on specialists for new arenas: In my many briefings with vendors and clients, specialized firms often provide something a general interactive firm or corporate web marketing team can’t. They have experience, know their area, and in this case, they knew to rely on someone that already knew Facebook (such as Social Interactive.
3. Compliment the existing user experience: Sony didn’t beat the 3 million existing users with heavy advertising (and I’m sure RockYou wouldn’t have let them) over the head, instead offered value by giving away prizes, and tied in a movie that already existed.

The main conclusion of Jeremiah’s post was that this individual campaign was highly successful and leveraging social applications for branding can be extremely effective. For Facebook application developers, you should be specifically targeting brands and looking for opportunities to forge new relationships. Do you have any examples of other applications that have used this tactic?

There has been considerable buzz on the Facebook Developer’s Forum about the best way to advertise applications. For a while some people were getting paid terribly low amounts for their clicks, and some of the services have apparently been buggy.

Since the best way to find out which one is the best service is to conduct empirical tests, I was hoping some of our readers who subscribe to them could provide some insight. I’m sure there are also some cool ideas out there that are outside of the box.

Since some cities are so heavily saturated with Facebook users, perhaps it’s even time to start considering advertising applications through other means.

I recently came across one of the most effective things I’ve ever seen a company do to market its product. My pizza box had an advertisement on it! Not some ugly ad… but a beautiful, high resolution, sexy advertisement for Tag. When I first saw it, I thought “wow.”

It wasn’t until after 1 week of it staring at me from my fridge and 2 weeks of it sitting in a recycling pile that I realized just how brilliant it was.

Kudos to Fresh Tracks Media for coming up with a novel marketing idea!

Leave a comment if you have something to say about the best way to market an application, within Facebook or otherwise.

- Jonathan Kleiman writes for the blawg LegalIntellects.com

You are sitting in the conference room with the rest of your company’s executives brainstorming about what is the next product your company should launch. Given that you have already launched a few relatively successful Facebook applications you decide that now is a good time to launch another product. “I got it,” you think to yourself. We’ll build an ad network for Facebook applications! It has only taken you 7 months and the launch of 12 competitors to realize that this might be a lucrative business.

Unfortunately, this is what AdBlade has done. They have launched yet another ad network on Facebook at the wrong time. There are now well established leaders in this market and attempting to become the next leader is extremely challenging unless you have a comparable active user base within your applications. AdBlade was launched by the people over at Congoo.com. Congoo has gone through many revisions in their business plan over the past couple years.

Two years ago, Pete Cashmore gave a fairly negative review. At the time, Congoo’s vision appeared to be somewhat blurred.  I think they are following the wrong path yet again with the launch of AdBlade.

Update
Ash Nashed, CEO of Congoo, reached out to me following this less than positive review of AdBlade. Ash accused me of not offering them a fair chance. I’ll be honest in regards to Congoo, I didn’t give them a fair chance and went to the first review of the site I could find for reference. I have since done a little more digging. Congoo provides a tool that enables users to view “premium content” on sites for free while providing the paid content owners with marketing information for each user.

The tool makes a lot of sense but I have to be honest, I don’t agree with paid content on the web except for Consumer Reports which strives to avoid a bias. Regardless, the tool works well, I just wouldn’t use it. The only tool I need to view content on the web is my internet browser and that’s it. Aside from their tool though I failed to give a complete review of AdBlade and just dismissed them right away. While I still think they are too late to the game I am open to demoing their service. I’m still waiting on a login to test it out. I’ll let you know if this changes my thoughts!

Mediaweek has published an article describing Facebook as being forgiven by advertisers. This is definitely good for Facebook even though some people are up in arms over privacy policies being blatently violated. According to the article, “Buyers say they are generally satisfied with the way Facebook has responded to the recent storm of controversy generated by Beacon.” Apparently it wasn’t as big of a PR disaster as many bloggers made it out to be.

Not only was it not a disaster but “many buyers credit Facebook for its willingness to be daring in this still-nascent space, where the rules of advertising are still being written.” Mike Shields, author of the Mediaweek article, spoke with a number of advertisers and it appears that the backlash against Facebook may have been overblown. This is why this morning I suggested that Facebook’s decision to let users completely opt-out of the service may have been a poor business decision.

Regardless, Facebook has a ton of momentum and is still only at the early phase of their growth. Facebook would be in the tornado phase as described by Geoffrey Moore in the book, “Chrossing the Chasm.” As such, advertisers are going to want to get a piece of the action and a little slip up by Facebook is not going to stop them. Brands will definitely be hesitant though when joining the new Beacon program. Do you think the drama surrounding Beacon is over or is will it soon flare up again?

Michael Learmonth is reporting that ABCNews.com didn’t get much help from advertising via Facebook. The one thing that Michael fails to mention is what form of advertising he is referencing. It appears that he is referencing an ABCNews.com Facebook application that has not performed very well over the past couple months. That’s not as much of a result of a poor performing advertising campaign as it is a result of a poorly designed Facebook application.

Whether or not ABCNews.com has experienced a poor performing Facebook ad campaign, Facebook’s performance as an advertising channel is still under debate. I have previously reported that Facebook has horrendously low click-thru rates. That is still the case but perhaps click-thru rates are not what should be measured. One advertiser that I spoke with while at the Web Community Forum in Seattle, siad that she had tested out SocialAds and the performance was great.

While the click-thru rates were still poor for this indiividual, she argued that she was able to generate more click-thrus through targeted advertising on Facebook in a short time frame than she was able to generate via competing advertising channels including Google and Yahoo. Unfortunately I don’t have data from other advertisers to substantiate this argument but if you have had a great experience with Facebook advertising, please let us know!

Federated Media Publishing has announced their expansion into Facebook through partnerships with the owners of the Grafitti application and Watercooler. The initial sponsors launching on Facebook are Hewlett-Packard and Wacom. These two companies mesh perfectly with the Grafitti application which enables users to draw on the grafitti walls displayed on their friends’ profiles. Grafitti has over 300,000 active daily users and Watercooler Inc. has over 500,000 active daily users.

This announcement provides legitimacy to the Facebook application advertising space and serves a massive blow to existing Facebook advertisers. One of the main issues facing large Facebook developers is the difficulty to connect with the companies (and brands) best fit to integrate advertising campaigns into applications. Federated Media will help bridge this gap for larger application developers and existing Federated Media partners.

Federated Media is now the largest advertising network to join the Facebook platform. This is a monumental step that will surely legitimize the platform’s potential. I have spoken with a number of other large ad networks (including ones larger than Federated Media) that have stated their intention to enter the Facebook application advertising space. Look for more announcements to follow in the coming months of large ad networks deciding to participate in this highly competitive and highly volatile space.

Federated Media stated that the new partnerships have helped their network to expand beyond 1 billion monthly page views. Other significant players in the Facebook marketing space include RockYou, SocialMedia, Cubics and VideoEgg. Looks like competition just got tougher in the Facebook ad space.

Nick has written a lot about Beacon and seems keen on a global opt-out. That would help the user experience, but to the privacy campaigners the ability to turn it off is not crucial - having it turned on in the first place, without being properly notified, is what really riles them. And quite right too.

Some commentators have unhelpfully suggested that if you don’t want to use Beacon, just don’t use Facebook. That works… but in the arrogant aftermath of “there’s no opting out of advertising”, users weren’t given any warning to make a run for it.

If Facebook insists that the cost of using the service is full participation in Beacon, then that’s fine. But give us more than 40 seconds of screen-corner popup to make up our minds. Anyway - whoever heard of a form that disappears? You were always supposed to visit the bathroom while Overstock streams your credit card across the internet, but you can’t risk that anymore.

Are they afraid that users might not be interested in using it? Maybe so, and they should feel free to insist that their users participate. Just don’t blink after 40 seconds. Designing the system to trip users into it is unfriendly.

Now we know what Facebook want to charge users for their site, how should they go about collecting their dues? Ever pragmatic, might I suggest a possible user interface component, that Facebook could display when you visit the site following a Beaconed purchase:

I’d be clicking “Yes”, by the way. But thank you for asking.

A couple weeks ago, Facebook unleashed SocialAds on the world. Facebook also announced their new Pages service and listed a number of launch partners. Since then, small businesses have had the opportunity to test out the new system and launch partners have begun promoting their pages via ad campaigns. So how has it turned out in the first couple weeks? While it hasn’t been horrendous, I wouldn’t yet call Facbook’s new advertising system as revolutionary. In order to developer a revolutionary advertising platform, it must not only be innovative but also deliver results.

Facebook has played with various models for promoting these new pages including a brief 24 hour placement at the top of the newsfeed yesterday that announced the new Pages service to members. That announcement included links to the Dave Matthews Band page as well as the (RED) campaign page. While I don’t have data pertaining to the daily growth of these groups, the numbers are relatively average for any sort of marketing campaign.

The Dave Matthews Band has close to 56,000 fans and the (RED) campaign has approximately 37,000 fans. While these are by no means horrible results, as a percentage of click thrus from a one day ad at the top of the newsfeed, it’s not that impressive. For comparison, The Dave Matthews Band has a whopping 300,000 members on MySpace. Time will be the true test here but it appears that the start of ad campaigns on Facebook are extremely slow but viral growth helps amass users over time.

How about small businesses, how have they been performing? Not so well according to the people that have been emailing me over the past couple weeks. The most frequent message that I get from individuals is about how their seemingly normal advertisement doesn’t get approved. Additionally, they get absolutely no feedback from Facebook simply a rejection notice. I’m not quite sure about Facebook’s policy for advertisements but the ones that users have sent me don’t seem to violate any terms that I know of.

Finally, Facebook ads have been getting a horrendous click-thru rate for most users. If you have had a positive result with Facebook SocialAds then please let me know and I’d be happy to post about your experience. I don’t want to be overly critical of Facebook but their ad performance have been relatively sub-par for all of the small business owners that I have spoken to. Perhaps that’s because the small business owners that would gain the most from this advertising system have yet to register.

I believe that the biggest growth opportunity for Facebook is in external advertisements that leverage your Facebook cookie to deliver highly relevant advertisements. Additionally, Facebook could more agressively target specific verticals such as music, movies and television. The main problem there is that they will be duplicating AOL’s model and that’s the last thing Facebook wants to become. How do you think Facebook could improve their advertising system? Is their existing system enough?

Alcohol and Facebook don’t seem to go together. According to Marina Strauss, a photo contest sponsored by Molson, in which students were encouraged to post photos of themselves partying, has was ended after facing complaints that the contest encouraged irresponsible drinking. I was under the impression that this promotion would have been a violation of Facebook’s terms of service but apparently that’s no longer the case. While controversial, I think the promotion sounded like a great idea.

Apparently Molson will still be announcing a winner of the contest even though the contest has ended. There have already been a number of controversies related to photos being posted on Facebook including a group that posted pictures of girls that were under the influence of alcohol. I didn’t have the opportunity to view the Molson contest but my guess is that similar pictures were posted to the contest. It is understandable that rewarding students with an $8,000 trip for five to Cancun for posting drunk photos may not be the best idea.

Molson has stated their intention to continue testing out alternative marketing strategies through various social media channels including Facebook. According to the article, Scott Keith of Lowe Roche ad agency believes that “nobody has cracked this thing,” referring to social media advertising. That’s kind of ironic given that his agency was chosen due to their history of social media advertising. Regardless, advertisers will try to develop creative new ways of advertising across social networks. Have you seen any effective ad promotions on Facebook?

Danny Sullivan has posted a great article for Advertising Age about search ads being the revolutionary advertising tool, not social ads. Danny has been a thought leader in the search engine industry for more then a decade so he has a slight bias but honestly, he makes a hell of a point:

Consider what Facebook founder Mark Zuckerberg told us about the transformation: “We are announcing a new advertising system, not about broadcasting messages, about getting into the conversations between people.”

“Getting into” conversations. Yes, how we enjoy that. You’re in a coffee shop talking with a friend, and suddenly along comes the spokesperson for an artificial sweetener, just wanting to have a chat.

Go. Away.

Facebook holds the most accurate depiction of the social graph (at least in the United States). Facebook also has the ability to target ads based on profile data, through trusted connections and through conversations. While this may be the holy grail of market research it may not necessarily be the holy grail of advertising channels. As I previously suggested, Facebook has an unproven advertising model. For Facebook’s sake I hope that they have data backing up this model, otherwise they may have trouble validating their $15 billion valuation.

Danny definitely has a great point: “Search offers a key way for new products to emerge and be spread around. People turn to search for solutions.” It’s really as simple as that. I have to agree with Danny but if there was some way to combine the best of both worlds, you would truly have a phenomenal advertising opportunity. Imagine if Google enabled advertisers to not just market by keyword but also to select demographic information for each visitor. This would be revolutionary.

I can guarantee you that Google is working on this but they are going to need access to the type of data that Facebook has. We’ll see how this pans out but together, Facebook and Google would be a truly unstoppable force. Too bad Google doesn’t have an extra $15 billion to spend. In the meantime, search advertising reigns supreme and Facebook will be left to prove the viability of Social Ads. Facebook may come out on top but we still live in the age of the search engine.

• Publishers Ask Facebook Executive 'WTF?'
• Facebook's Sheryl Sandberg: Big Opportunity for Brand Advertising ...
• Do You Think?
• We're Related
• Facebook Developers See 20-50% Drop From URL Change
• Is Facebook Becoming MySpace?
• How Facebook Changed Gaming
• Bumperstars
• MoveOn.org's fuzzy McCain-Palin Facebook ads
• Facebook (censored) - Video
• The FaceBook Era: Tapping Online Social Networks to Sell, Market and Innovate by Clara Shih
• Is Facebook Really Where You Go to Watch? - Bits Blog - NYTimes.com
• ABC News: Quirky Facebook Groups Draw Fans, Profit
• PageRage Super Profile
• RedBull + Facebook Connect
• Tech Crunch
• The Webpreneur
• Mashable
• Del.icio.us
• Facebook
• Google