Facebook’s announcement of the new version of the Open Graph back in the Fall left marketers wondering the best way to utilize the new features. Earlier this year there was a push for marketers to adopt the new brand Timeline. The latest buzz is around Sponsored Stories, Facebook’s new ad unit, which allow brands to purchase more targeted and contextually relevant ads.
In a survey done by Marin Software, which was featured in an eMarketer article this week, Facebook Advertisers Find Better Payoff with Sponsored Stories, analysis shows that worldwide advertising performance on Facebook had gone up between April 2011 and May 2012, with click through rates increasing by 20%. The improvement in performance can be attributed to Facebook’s new Sponsored Stories. Although costs for Sponsored Stories are more expensive, they’re proven to be more effective.
Brands have questioned the effectiveness of Facebook ads, but with Sponsored Stories brands can expect that with more contextually relevant and targeted ads, Facebook users’ perceptions and their willingness to engage with Facebook ad content in the future will improve. It is predicted that Sponsored Stories will be an increasing part of Facebook advertising spend for brands. “Marin Software predicts that that Facebook advertisers would allocate 50% of their budgets towards social ad formats like Sponsored Stories by the end of 2012, which would be a big leap from the current 23%.”
Coming soon, brands will be able to purchase Sponsored Stories based on consumer stories collected through the Open Graph. These stories will improve targeting and deliver ads with social context to a consumer’s social circle. So, brands will be able to purchase Sponsored Stories from the earned media (C2C stories) to drive more effective paid media. To learn more about Sponsored Stories and how to drive more effective paid media, check out Part 2 of our Open Graph series, launching this week.