Facebook’s new advertising strategy - predicting your interests
Just last year, Facebook turned down a $750 million offer, and by July this year figures of $10 billion were being thrown about. Not surprising when you can boast of 100 million visitors in the last 30 days [TrafficEstimate] from an estimated member base of 24 million, growing at about 150,000 per day.
When news of Facebook’s 0.04% CTR came out, however, Facebook’s rumoured charges of $300,000 for group sponsorship may have appeared a bit of an overkill.
This would have been reason enough for Facebook to work on its much talked about new advertising system to allow marketers to target users with ads based on the information people reveal about themselves on the site. Rather than banner advertising, Facebook is exploring placing ads within news and content feeds on users’ profile pages according to the Wall Street Journal, which is almost calling the move revolutionary and at par with AdWords. Given that AdWords raked in $10.6 billion in revenue last year for Google, that would be something.
Over time, Facebook plans to put in place a series of complex algorithms that eventually, it hopes to would allow the system to predict what products and services users might be interested in even before they have specifically mentioned an area.
To start off, however, it would allow the advertisers to choose a much wider array of characteristics for the users who should see their ads — based not only on age, gender and location, but also on details such as favorite activities and preferred music, etc. Facebook would use its technology to point the ads to the selected groups of people without exposing their personal information to the advertisers.
The other possible moneyspinner for Facebook, could be in its open technology platform, which allows developers to integrate their products into Facebook. CEO Mark Zuckerberg in mentions, “We want to make Facebook into something of an operating system so you can run full applications,” adding that it would be analogous to the platform that Microsoft Windows provides for developers. Outsiders would be able to develop Internet services on Facebook’s infrastructure, he explains, that will have full access to all its members.
This is likely to result in an explosion of creativity, with a host of applications being developed adding to the richness that is already prevalent in Facebook, and helping it to grow even further. For companies it offers yet anther manner of interacting with the Facebook audience, while for developers, it offers a chance to showcase their products to the world as well as the opportunity to make money from them. Facebook will impose no limitations on what kinds of applications others can create, except that they be legal.
How long before the others smarten up.
Filed under: Business, Digital culture, Ideas & Innovations