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Facebook is hard at work serving personalized advertising to its users, and the network's popular self-serve ad platform is a big part of its planned $1 billion in revenue for 2010. But it doesn't take a long visit to the site to see that those ads aren't always on target.

Today The New York Times looks at the ongoing problem of misdirected Facebook ads. Facebook's platform is still relatively new, but its personalized approach to display is not always so personalized.

According to The Times:

"The so-called self-service ads on the site, from the likes of video game start-ups, herbal supplement makers, sweepstakes companies and wedding photographers, are shown on the right side of most pages. Many advertisers who use the self-service system are tempted to go as far as possible in making ads that attract attention and appear relevant, aided by the information that people give to Facebook."

Unfortunately, that often means users get hyper-targeted for their demographic information and interests. Men who are pushing 40 get ads that offer to help them lose weight, fight baldness and last longer in bed, while any woman who changes her status to engaged is sure to get bombarded with wedding planning ads.

And for users who do not provide extensive data on their profiles, that often means getting mistargeted (as with the ad above for moms that I was served).

Facebook says that as time progresses, it will get better at serving advertising. From The Times:

"Dan Rose, vice president for business development at Facebook, compared the company’s self-service ad platform to the early versions of Google’s highly profitable AdWords system. He predicted that the quality of the promotional messages on the site would improve as more companies began to use it.

“A year ago, we had lower-quality ads, and a year from now we will have higher-quality ads,” Mr. Rose said. “It’s early, but we have made a lot of progress.”

But the idea of serving ads based on profile information will unavoidably lead to marketing noise on the network. Times writer David Gallagher decided to conduct a Facebook experiment:

"I realized I had posted almost no information about my favorite bands, hobbies and so forth, making it hard for anyone to focus on me. So I beefed up my profile with a keyword bonanza: surfing, snowboarding, skateboarding, knitting, cooking, Xbox, Star Trek, Star Wars, Harry Potter and so forth. (Keywords are for experimental use only and do not reflect actual interests. Except maybe Star Wars.) This produced some quick changes. Among other customized ads, I started getting the surfing- and cooking-themed campaigns shown above. In fact, foodies seem to be a big target for Facebook advertisers. But there were still plenty of junkier ads, like the Oprah one, which would seem to violate Facebook’s policy regarding the need for some connection between the image and the product being advertised. Unless Oprah is in need of debt relief."

Stowe Boyd suggests that Facebook simply ask users what sort of marketing messages they'd like to receive. That route towards consumers is difficult because consumers often attempt to refrain from all advertising when given the choice. And they often aren't aware in the abstract of what ads they might find useful.

But another route is to make ads on the social network more social. Boyd writes:

"Why can't ads -- good ones, ones that actually offer value for possessing them, like discounts or exclusive time-limited offers -- become social objects that increase in value by being passed around? Why can't discounts increase, for example, when many of my friends pass the same offer along to me?"

One of the strengths of social networking is the power of the social graph, and utilizing users' friends to share marketing could be great for brands. But Facebook is wary about putting ads in places where they are not clearly distinguished.

For instance, an Ikea contest last year that gave away products when consumers tagged them in pictures on a Facebook profile was a great way to use Facebook's sharing capabilities, but ran afowl of Facebook's terms and conditions.

Meanwhile, ads that are based on behaviors fare much better. And Facebook is fully capable of serving them. Bing ran an in-game Farmwille ad on Facebook this week that offered users 3 Farm Cash (FarmVille’s virtual currency) if they became a fan of Bing. In two days, Bing went from having about 100,000 fans to over 500,000.

By targeting users where they are and offering them something they'd value, Bing was able to achieve its short term goal of growing its fan base on Facebook. It remains to be seen if those followers will enjoy or continue receiving marketing messages from Bing, but it's certainly a step in the right direction.

Meanwhile, Facebook's self-serve ads are clearly returning good enough results for advertisers to continue to grow their spend on the service. By keeping detailed tabs on how different ads perform with different users, the network will continue to serve more relevant ads on the site. And there is plenty of room (and time) for growth.

However, consumers have gotten pretty good at avoiding display ads on other parts of the internet, and it's a skill that is easily adapted to social networks.

As Times reader Deaon Jones writes:

"The facebook ads are really bad so I taught myself to not even look in the general direction. If facebook ever put anything useful in the right most column I am sure to miss it."

Images: Facebook

Meghan Keane

Published 4 March, 2010 by Meghan Keane

Based in New York, Meghan Keane is US Editor of Econsultancy. You can follow her on Twitter: @keanesian.

721 more posts from this author

Comments (4)

Magnus Nilsson

Magnus Nilsson, Managing Director at RED PerformanceSmall Business

Like the idea of making offers into social objects, such as the discount example. Regarding the farmville example, possibly not best use as there's not much of a connection between the incentive and the product.

over 6 years ago

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Alec Campbell

The real genius in the Bing campaign via Farmville is not the primary contact - that was merely the incentive to get people to sign up for the fan page. Now everytime Bing posts a message on their page, they get 500,000+ possible impressions via each fan's news feed.

Further, everytime one of the fans posts a message or clicks to like something on the Bing page, it is broadcast to that person's contacts via their FB wall. Their last post received a total of ~2000 likes + comments. If you assume that each of those fans has an active FB friend network of 100, that's another possible 200,000 impressions per Bing post.

Does anyone know if FB makes money on direct and indirect fan page impressions?

Alec Campbell

over 6 years ago

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Wynne

I for one am not worried by the ultra-targetting that facebook promises. The more targetted the ads, the better the quality of matching ads to consumers. And if facebook maintains their promise to filter out spamming cruddy advertising campaigns (much like google does), then things should shape up just fine. The truth is that facebook represents a great platform for advertising.

over 6 years ago

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Douglas

Facebook's ad targeting has always been hit or miss at best. When I started receiving sponsored ads from a particular cellular phone company that I will never return to as a result of the way they treated me when I was going to resubscribe, I've continuously flagged the ads from them as being offensive. Facebook claims that over time flagging the ads helps them to deliver more relevant advertising to you. It's been at least 1.5 years of consistently flagging ads from that particular company and they still appear almost every day!

about 5 years ago

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