Facebook Testing News Feed Ads

In a desperate bid to impress advertisers, Facebook is making a move that could risk alienating the loyal brands who have been using the social networking site since the beginning. At the moment, the only way for a brand to get their message in the news feed is by working hard to gain their “like”, or through social recommendations from friends. However, Facebook is now testing out a new advertising model that would see non-social content showing up in users’ news feeds.

Until now, the news feed function allowed users to decide exactly what shows up based on who they’re friends with and which pages they “like”. When the new changes go through users could start to see paid advertising content from companies and brands they haven’t opted to hear from. What kind of message does this send out to those companies and brands that have spent time and money on building up a genuine following on Facebook?

True, these companies will have been given a free ride from Facebook, after all, a Facebook page costs nothing, but this doesn’t mean it was free. To keep a social media page up-to-date, to publish fresh content, and to encourage interaction takes time and company resources. And some may fear that this time may have been wasted if they can now simply pay to put their message in front of their target audience.

According to ClickZ, a Facebook spokesperson stated in an e-mail:

“These ads may appear on both desktop and mobile and will look like other Page post ads in news feed with a sponsored label.”

This move is also likely to be unpopular with Facebook users, as the majority of users sign up to utilise the websites’ social function, not to be bombarded with advertising messages. Some users will even actively avoid liking brand pages in an attempt to keep their Facebook news feed purely social.

After Carolyn Everson joined Facebook last year as the VP of Marketing, she has been on a mission to win over sceptical advertisers and convince them that there is opportunity for ROI  on Facebook advertising. There’s a lot riding of the success of Facebook’s ad network, as 85% of its total $3.7 billion in revenue in 2011 was derived from global online ad sales.

On the whole, the forecast is not good for Facebook: their stock price is tumbling, down 46% since the IPO; advertisers are fleeing, from the big corporations, to the small start-ups; and they were slow on the uptake with mobile advertising, at a time when mobile is king.