If you’ve used any Facebook applications in the past two years, you’ve probably seen the ads which say “You Have 2 New Messages” or “One of your buddies has a crush on you”. The advertisements have become practically ubiquitous across Facebook applications and there’s a good reason for that: they have an extremely high payout.
The sites that users are driven to trick users into subscribing to a horoscope subscription service and according to the Washington Attorney General, those advertisements are false and deceptive and “violate the settlement agreement Tatto (the advertiser) signed last year, when it agreed to refrain from such campaigns.” These types of advertisements are well known among ad industry executives although most refrain from discussing these dirty tactics.
While Tatto Media is the primary offender behind these advertisements, there are many other companies that have adopted this style of advertisement since they tend to have high click through rates. You would imagine that most developers and ad networks would stay clear of these ads for the long term protection of their businesses but many companies don’t appear concerned.
These types of ads are a “dirty secret” for many of the ad networks that try to present an innocent front to their businesses. As one anonymous top 50 developer told us:
This is definitely economic driven as most networks avoided these ads in the past. The regular ads are paying so little now, and these are the only ones that pay anything, so I think networks are doing what they have to survive.
At this point it’s difficult to say that any of the ad networks have keep their hands completely free of these types of advertisements. Even Facebook has run controversial advertisements, such as the recent bailout check advertisements that became ubiquitous for a couple weeks. So why are these ad networks letting these ads “slip through the cracks”?
As the anonymous developer told us, “I can tell you from experience those ads have cpm’s at least 5x anything else, and with regular ads getting lower payouts every month, I’m seeing those more and more on all ad-networks.” So has Tatto Media slowed down their display of the deceptive advertisements? Not at all since $500,000 settlements are just a cost of doing business.
In these hard economic times, businesses are doing what they have to survive and for a number of Facebook ad networks (and ad optimizing networks), that means placing deceptive banner ads. Have you seen these ads on applications? Have you ever clicked on them?
![[Inside Social Apps 2012]](http://www.allfacebook.com/wordpress/wp-content/themes/allfacebook2/images/ISA2012_336x100_F_RegisterNow.gif)
![[AllFacebook Stats: Facebook Analytics for Your Business]](http://www.allfacebook.com/wordpress/wp-content/themes/allfacebook2/images/stpro_allfacebookstats.gif)
![[How can Facebook change your business?]](http://www.allfacebook.com/wordpress/wp-content/themes/allfacebook2/images/FMB_A_MAY2011_336x100_F.gif)
When I first joined fb about a year ago I remember seeing these 'messages'. I was a little suspicious about them, but the thought that maybe they were legitimate messages had me thinking maybe I should click the link. Being new to fb and having added so many applications it was concievable that they were from one of those apps (went the thinking). Only took me one click to realise it was just an ordinary run of the mill ad. Very annoying, but from then on I just ignored them.
One thing I couldn't work out was why fb allowed these deceptive ads to be placed on their site. A 5x click through rate compared to other advertising would explain that.
Comment by Stephen Moore — March 24, 2009 @ 7:01 am
Clearly, this type of advertising should be stopped as it preys on those who simply don’t know any better. The ad ‘appears’ to be a part of facebook, when in fact, it is spam. They have the click through rates for those who just don’t know any better.
In any event, I have not clicked them and it has really affected my use of the Calendar app as I am tired of this type of ad popping up at the top.
Comment by John Gallagher — March 24, 2009 @ 9:32 am
Surely these types of ad are actually illegal, since it amounts to false advertising? I guess that is the basis on which Tatto had to pay out a civil settlement, and if that is the case, why can they not, on the same basis, be prevented from running illegal ads altogether?
I can't believe that any business person would compromise the integrity of their business by advertising in this manner. As a business-owner, I would never even think of tarnishing our good name by using this type of under-handed advertising. And I never buy anything from any company which runs this type of intrusive and mis-leading advertisement.
Comment by Zoe Symington — March 24, 2009 @ 3:04 pm
Why is click-thru rate relevant for a deceptive ad? These ads may have click-thru, but they don’t work. They annoy people, who learn to ignore them. They’ll be gone eventually, when the parasites who run this type of ad are all out of business.
Comment by Sn1per — March 24, 2009 @ 6:27 pm
@Sn1per: These ads may have click-thru, but they don’t work.
It’s pretty clear that they work well enough or Tatto wouldn’t keep running them. If you got $10 for every person who signed up, but only had to pay 10 cents / click. Then you only need 1% of those clickers to sign-up. Everything else would be gravy.
I don’t know what the actual numbers are, but there’s probably a point where you don’t really need more than 2 or 3% of your clickers to actually make a profit.
Comment by Anon — March 25, 2009 @ 10:58 am
This discussion reminds me of 2003 – 2004. At that time, consumers were still flocking to the web while the dot-com bubble burst was driving away advertisers who couldn’t figure out how to monetize. Tough economic times for many, to say the least.
At that time, even the largest ad networks were hungry for, and gladly ran, banners on a CPA that lead to incentivized co-reg paths. Ultimately, there was enough consumer backlash that the AGs got involved, but in the meantime, those advertisers flourished. If the truth were told, without those advertisers, many of the networks would have perished. They genuinely needed the money at the time… And without those advertisers, some of the content-rich sites we love today simply wouldn’t be around.
Face it, response rates on FB can be horrific, and we are in an even worse economic environment. Already, we’re seeing AG action, and brands are beginning to figure out how to make FB work. At some point, the market (strong brand demand or low ROI) and/or regulators will ultimately take these advertisers out of the equation (or at least minimize their presence). For now, I say live with (but ignore if you want) these ads. Otherwise, we may end up loosing a resource that we all love.
Comment by Dennis Dailey — March 25, 2009 @ 12:01 pm
We're going to see more of a shift in advertising on Facebook now that Bing is in the picture. Ads are already very well targeted to the point that it is scary. That's great for the advertiser and the next step is to get ads up that address users based on their intent. All of these irrelevant ads with "someone has a crush on you" etc. aren't addressing the user's intent in most cases. Certainly people troll Facebook looking for a date and in those cases it's relevant. However most people are there to connect with friends. It's a challenge for merchants to monetize these ads because users are not in buy-mode. Hence the "crush" ads, which are at least more "social" in nature. It'll be interesting to see the next phase of Facebook ads in light of all of this.
Comment by Dennis Consorte — March 15, 2011 @ 4:12 am