Facebook Unveils Status Update Sized Ads

Facebook today unveiled what it calls sponsored stories, advertisements that appear in newsfeeds and look like reiterations of friends' likes and checkins. The social network posted a video at midnight explaining how the new ads work.

Facebook today unveiled what it calls sponsored stories, advertisements that appear in newsfeeds and look like reiterations of friends’ likes and checkins. The social network posted a video at midnight explaining how the new ads work.

The ads basically make sure that people notice their friends’ likes and checkins by reposting them as updates in the news feed. Without the sponsored story, word-of-mouth recommendations get lost in newsfeeds because of the sheer volume of information generated by people’s daily activity on the site, as A Facebook engineer identified in the video as Phil says.

In beta tests of the new ad format, the sponsored stories increased so-called brand lift, ad recall and viewers’ likeliness of recommending the marketed product to other friends. The only apparent difference between the original like or checkin and the sponsored one is that latter has a label at the top saying “sponsored story.”

The new sponsored story happens to coincide with Facebook at least temporarily halting the ability to suggest pages to friends, although the disappearance of the latter could have been a bug resulting from administrator’s page insights going real time.

At the very least, we now have an explanation for why the social network might pull the “suggest this page to friends” link — Facebook wants to monetize the promotions. If the suggestions come back, they will doubtlessly appear on the menu of sponsored stories that brands could purchase. So instead of seeing the suggestion only until you either click through to like the page or mark the “x” so the recommendation goes away, it would instead come back to haunt you, so to speak.

While these promotional opportunities may tantalize advertisers, one could see how privacy activists might not be thrilled with them, but hopefully the label “sponsored story” will mollify would-be complainers.

What do you think about this new advertising format? Would you buy a sponsored story campaign?