As I covered last week, Facebook has begun to release demographing information via their advance Flyers system. Valleywag appears to be hyping this up to be Facebook’s stealth ad system. Honestly, there is nothing stealth about this. Facebook announced the release of their new advertising system over a month ago. The primary benefit of this new system is that it is based on a cost-per-click (CPC) model rather than cost-per-impression (CPM).
Facebook is indeed taking a bite out of the online advertising market. Their new system enables advertisers to target better than any other advertising system out there. For those that argue that much of the profile data is inaccurate, Facebook can easily filter through those. Will Facebook upgrade their ad network to enable better ad placement?
Currently, Facebook simply places a flyer in the left hand side of the site. This positioning has historically horrendous click-thru rates (somewhere around 0.04%). If Facebook embedded ads within profiles, it may make the system more effective. Conversely, placing ads in more strategic locations may result in a backlash from users (similar to the one experienced when they launched newsfeed).
So is this the much anticipated advertising system that has been rumored for the past few months? Nope. It is one component but Facebook is going to soon enable developers to monetize their applications, something that until now has been offered only by third parties. Will Flyers be the primary monetization model for app developers? Probably. Any other form of advertising would be a direct attack on existing advertising solutions.
While I think the upgrade to the Facebook Flyers is a step toward Facebook’s much anticipated advertising system for developers, I think it is simply that, a step. In addition to advertising solutions, developers are calling for more effective analytics solutions. The bottom line is that there are a number of features left to add before Facebook becomes the spectacular advertising system that many have been dreaming of.
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The Numbers Behind Facebook Flyers…I just read a great post over on Mashable about the revamped Facebook flyers advertising system (originally from allfacebook). Palin Ningthoujam describes how they work and what they are all about but doesn?t touch an amazing issue I am intrigued abou…
Comment by Yedda. The Blog — October 22, 2007 @ 8:50 am
[...] [via allfacebook] Link to This Post: [...]
Pingback by Facebook Flyers 2.0: The Promise and Pitfalls of Social Networking Ads — October 22, 2007 @ 12:06 pm
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Pingback by Facebook Flyers 2.0: The Promise and Pitfalls of Social Networking Ads « ShortNet — October 22, 2007 @ 1:03 pm
The Numbers Behind Facebook Flyers…
I just read a great post over on Mashable about the revamped Facebook flyers advertising system (originally from allfacebook). Palin Ningthoujam describes how they work and what they are all about but doesn?t touch an amazing issue I am intrigued abou…
Trackback by Yedda. The Blog — October 22, 2007 @ 1:50 pm
@Nick, you’re right, these are great apps. But how will developers monetize them? Look no further than Valleywag Labs’ patented “Fanafi” algorithm.
Comment by Nicholas Carlson — October 22, 2007 @ 7:57 pm