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Facebook will soon make it easier for brands to reach users who might actually be interested in buying their product or service. As reported by Bloomberg, the social network announced Facebook Exchange, a real-time ad-bidding system that will enable marketers to target specific types of users based on their Web browsing history.
The ads will be sold by third-party brokers that use cookies to track users on the Web.
Facebook Exchange will launch within weeks; Google, Yahoo and AOL are already use real-time bidding technology to target ads to consumers as they surf the Web. While traditional Facebook sidebar ads reach users based on what they "like" on Facebook, the new platform will reach users based on their Web history outside of Facebook.
With Facebook Exchange, marketers will be able to target people who have visited certain kinds of Web sites—for example, users who have visited travel sites to research trips to Hawaii may later see a promotion on Facebook about hotels in Hawaii, according to Bloomberg. Pricing will be based on cost per thousand viewers.
TechCrunch reports that users will be able to opt out of Facebook Exchange via third-party platforms, but can’t opt out of the program completely within Facebook itself.
Twitter also tracks users' Web data, but only to help them find people who are tweeting about subjects most relevant to them—not to generate ad dollars or sell any user information to third parties. In comparison, Facebook's intentions are clear—to generate more revenue.
Facebook teamed up with research firm comScore to combat recent criticism about its advertising efficiency. In a study released June 12, comScore said that “exposure to Facebook premium ads drove statistically significant lifts in both online and in-store purchase incidence for a major retailer over a four-week post-exposure period." While the comScore partnership was a defensive measure to prove Facebook ads do work, the launch of Facebook Exchange is a proactive move.
PR pros say clients are sometimes wary of running ads on Facebook. “‘We don’t want to buy our fans,’ is a popular complaint with clients,” says Nada Arnot, chief digital officer at RF Binder. “[But] you’re not buying your fans. Users choose to click through and like you once they're there and they can see you—the ad just facilitates that action.”
Follow Bill Miltenberg: @bmiltenberg