Advertising Age reports today that Facebook has been mailing carved Lucite bricks to ad bigwigs in NYC, something about a Nov. 6 press conference on "a new way to do advertising online." Sweet. Facebook is finally stepping up to monetize its base.
This is going to be interesting, because current ad formats on Facebook pretty much blow. Banner ads require you going through Microsoft, and good luck getting a call back. Widget-based advertising is a little silly. And Facebook's two intriguing options, news feeds to users' home pages and sponsorship pages that act as microsites, have questionable results. A fully loaded microsite will set you back about $50,000 per month, all for the opportunity to hope your brand advocates seek you out inside Facebook to chat about new Victoria's Secret lingerie.
The hard truth is consumers have different modalities, and if they're being social, they may not want to be interrupted. Internet advertising works best when consumers are searching, not socializing. This is why Facebook click-through rates are low, at about 0.04% for Facebook banners vs. the 0.14% average for U.S. banners vs. upwards of 0.70% for behavioral targeting banners on skilled ad networks such as Tremor Media. Advertising to a Facebook user is a bit like interrupting old college friends immersed in gossip at the end of a bar. When on Google, consumers are chucking spears. When on Facebook, they're drinking beers.
Facebook must be aware of what doesn't work. So on Nov. 6, stay tuned. We think there are two possibilities: Either (a) an enhanced version of News Feed on users' home pages, in which trusted advertisers are invited to give you news, or (b) Facebook gets really ballsy and moves the ad platform off its domain into other sites. Imagine -- what if Facebook became a widget itself that could roll around on other web sites, and you could check in to your Facebook window from Digg.com, Slate or WSJ online? And what if that rolling Facebook window was sponsored by an advertiser? Maybe Facebook will succeed best by untethering it from itself.
Whatever. Facebook has filed a trademark for the term SocialAds, so we know the name. Now, we just hope the new format includes Victoria.
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