The popular social networking site Facebook Inc. is trying out new tactics to churn out steady revenue from its advertisers. New ads called “engagement ads” appear on the main screen when a person first logs into Facebook. Then the user is prompted to do something with the ad i.e. commenting on a movie trailer or RSVP for the finale of a TV show, etc. If the person goes through with the action, Facebook then sends a notice about what the person has done with the ad to their friends.
Facebook has been testing this new ad format since August and just this month has started making it available to advertisers. According to Facebook, 70 of the U.S.’s 100 largest advertisers have advertised on its site since 2007. Despite Facbook’s attempted efforts, competitor MySpace.com is still the market leader with 15.9% of display-ad spending.
It has been said that buying ads on Facebook and MySpace usually cost less than buying ads on sites such as Yahoo or AOL. Facebook has hired top ad sales executives from top companies and has also sent teams into agencies to pitch products and generate awareness about its research tools.
The only problem Facebook may have is people getting frustrated with a ton of new ads popping up. Something that used to make Facebook unique from MySpace was that it was not flooded with a bunch of different ads. Within the next few months, we will see how users react to the new and more prevalent ad usage on Facebook. Since most of Facebook’s targeted users are college students and young adults it could be seen as a downside; however, for marketers it could be seen as a great aspect.