How Facebook Sold You Krill Oil

An anonymous reader writes with this look at how Facebook tries to make and sell "thumbstopper" ads compelling enough to get people to stop scrolling through their news feeds. With its trove of knowledge about the likes, histories and social connections of its 1.3 billion users worldwide, Facebook executives argue, it can help advertisers reach exactly the right audience and measure the impact of their ads — while also, like TV, conveying a broad brand message. Facebook, which made $1.5 billion in profit on $7.9 billion in revenue last year, sees particular value in promoting its TV-like qualities, given that advertisers spend $200 billion a year on that medium. "We want to hold ourselves accountable for delivering results," said Carolyn Everson, Facebook's vice president for global marketing solutions, in a recent interview. "Not smoke and mirrors, maybe it works, maybe it doesn't."

Comments

Snake Oil

[Anonymous Coward]

Anyone claims they know their readers / visitors to a 'T' and tries to tell you that they can help your ad home in to a chosen group of visitors / readers is selling snake oil

Re:Snake Oil

[Anonymous Brave Guy]

Millions of people voluntarily give all kinds of relevant information about themselves to Facebook. Even without any serious data mining, and ignoring the people who deliberately create garbage data accounts, Facebook probably already have more accurate demographic data about their users than most advertising channels. For example, knowing about major life events like someone getting married or having a baby are advertising gold for some markets.

At the scale they're working on, even trivial analysis of the underlying graph is probably quite informative as well. If 60% of your friends are interested in a certain thing, there's a fair chance you are too, even if you didn't explicitly indicate this.

Re:Snake Oil

[cnaumann]

If you are using a credit card in a store like Target, they not only know your likes and dislikes, they know exactly what you buy. Sometimes they know more about you than your family.

http://www.forbes.com/sites/ka...

Re:Snake Oil

[Electricity Likes Me]

Here's the problem: Facebook will never not show you an ad. At the end of the day, if you don't fit a better model, they revert to lowest common denominator advertising. "Over drinking age? Male? Cue up the alcohol ad with women in it!"

And that's the thing, Facebook's advertising as a result is like all the other advertising in the world: you know where it is, you know it mostly never applies to you, so you tune it out. If they make it more prominent, you turn on ad block. Which says worlds about their actual confidence in their data: they don't have any. They don't know what you will do next. Which is why they always show you something - because they can't afford not to. They won't leave ads turned off, then strategically show them right when you show a high probability of being interested in X and could be swayed to a brand. They have no idea when that is, or what it will be.

Re:Snake Oil

[Old97]

Yes, but then there are the data brokers who put that all together for their customers. Selling and exchanging data is a big business. A company can buy the raw data in some cases or share their data where it goes into a pool and the broker provides (sells) you details about customers, prospects, leads, partners, etc.

Re:Snake Oil

[Anonymous Brave Guy]

Here's the problem: Facebook will never not show you an ad.

I'm not sure whether that's strictly true, but I'm also not sure why it's relevant. Even if we assume Facebook intends to show a fixed X amount of ads to each user per visit/unit of time/number of other entries in their feed, Facebook ads run on an auction system. The targeting available to advertisers is quite objective about who is and isn't included in the potential audience, and any given ad is only going to be shown to qualified users. But those qualifications can be as simple as the country you're in or being a friend of someone with a certain interest, so even if someone hasn't given much information themselves, there are always things that Facebook have a very high probability of determining correctly.

Re:Snake Oil

[hoggoth]

I find that Facebook, Google, and every other "targeted" ad system does the same thing: they show me ads for the thing that I just bought and won't need to buy again for several years.

Re:Snake Oil

[Bill, Shooter of Bul]

What? They are the retailer. Of coarse they have access to your itemized transaction records purchased through them, its right there in the POS at checkout.

They know your full name and the zipcode you shopped at along with the purchase history with that card. That's probably enough to identify you and cross reference the address book to figure out the rest of your address. They can then target your snail mail, if they want. Or sell the info to their suppliers, so they can do the same.

Re:Snake Oil

[mehrotra.akash]

Interestingly, I've noticed that leaving abandoned shopping carts triggers ads with the same products, but discounted. I've used this more than once to get a 10-20% discount

Re:Snake Oil

[Kingofearth]

Facebook doesn't promise that your ads will only be shown to people who care about them, they offer the ability to target ads based on fine-grained characteristics. I often see ads for bands and DJs that I like when they're coming to my area. No one's guaranteeing I'll buy tickets, but if I "like" Bassnectar and "music festivals", and Bassnectar is playing a music festival in the midwest, (aside from the fact that I likely already know about it) targeting ads to people like me is about as effective as you can get for advertising.

News' length

[Thanshin]

Now I'm sad about the length of news I really couldn't care less being about four times longer than news I'd like to know more about.

And they even include corrections (as fundamental as changing Caroline to Carolyn).

In science news, to get more than four paragraphs in the NYT one has to reach Mars riding a comet harnessed with carbon nanotubes. And replacing "light years" with "ping-pong balls" wouldn't be deemed deserving of errata.

Re:News' length

[MightyYar]

I'm with you. I just read the minutes of a meeting full of advertisers selling a dubious product.

Re: News' length

[IMightB]

I clicked on that super models fashion link you posted and clicked again through the ads and the only thing that popped into my head was they were trying to sell was self starvation. Half the pictures looked like they had pulled bodies from concentration camps and put hideously ugly clothes on them.

dear facebook

[dominux]

I have a problem with my fish oil sales, it tastes like shit, it does not outperform a placebo and costs twice as much as other competitors that also do nothing. Can you help?

Of course Facebook can help, that is exactly what social media is for.

Re:dear facebook

[NotDrWho]

Where can we get these "placebos"??????

"Tell us what your heart beats for!"

[rmdingler]

FB would love advertisers to believe their questionably ethical compilation of your particulars can be used against you.

Advertisers want a piece of the place where, FTA, one in 5-6 online minutes is spent.

I have left instructions for my family per what to do in the event of medical brain death, or evidence of a Facebook account... but I repeat myself.

Facebook didn't sell me anything

[ArcadeMan]

When Facebook says they have 1.3 billion users worldwide, do they count inactive accounts such as mine, which I had to create to make sure nobody else could create a fake account about me and fill it with slander?

Re:Facebook didn't sell me anything

[Anonymous Coward]

I had to create to make sure nobody else could create a fake account about me and fill it with slander

Rerouting auxiliary power to the tinfoil hat.

Re:Facebook didn't sell me anything

[CaptainDork]

It counts the 17 (seriously) that I have so I can do my stuff, and it does include the two (2) that cannot be used because they are banned for life. (I was testing the limits)

And, I know it counts the one I actually do use under an alias.

*I* am not on Facebook.

I know from first-hand knowledge that Facebook game players have have at LEAST two (2) accounts apiece.

Re:Facebook didn't sell me anything

[Charliemopps]

I had to create to make sure nobody else could create a fake account about me and fill it with slander

Rerouting auxiliary power to the tinfoil hat.

I know a couple of people this has happened to. It's usually a teenage prank. Unfortunately the OPs idea doesn't work. Everyone I know that this happened to already had accounts and the perpetrators just spelled the name slightly different.

I just flat out deleted my account years ago. And trust me, that is no easy feat. You have to put in a request to remove the account, then they put a 2 week delay on the request. If you open the facebook site at all it restarts the counter. Given that facebook is nested on just about every site this was difficult. It happened so often I finally blacklisted every domain they own in IPTables on my firewall, then routed my phone through a VPN to the same firewall. At work I had to dump my browsers history, temp files, etc... so I wouldn't accidentally log in. What they considered a login at the time was crazy. Things might be easier (or harder) now, I wouldn't know. But I do know a lot of my friends and relatives are deleting their accounts now. They saw I did it, and didn't vanish into obscurity, so why not them to? There does seem to be a frequent problem of "What do you mean you didn't know there was a cookout?!?!" or "You didn't see the wedding photos?!?" but, to be honest, I haven't missed anything I'd have cared to see/attend anyway. If you really care that I show up, you got my number and you know I don't use facebook. If my attendance isn't even worth a phone call, I'd rather not attend.

For the first time I feel good.

[Anonymous Coward]

For the first time in my life I feel good about being a misfit.

I do not have a facebook account nor a LinkedIN account for that matter - don't get me started on them!

Anyway, reading that article it reminded me of something Henry Ford said (Bio on Netflix) with regards to GM/Sloan's success:

To paraphrase:

People were shrewd consumers looking for value. Now, they want to be sold to.

When an advertising company like facebook or Google can make billions and fantastic margins, while companies who make things or provide services that actually add value to people's lives just survive, I just wonder where people's heads are. Everyone works so hard, but throws money on shit. And opportunities are drying up for work because of off-shoring, automation, and our demographic changes in our society.

It's like the future of this country is going to be Medical (especially elder) or sales. That seems to be the only opportunities left.

If you want to get rich quick - like Mark Zuckerberg - figure out how to see to people. Selling anything.

Yeah, yeah, yeah, I'm taking my library card and getting out of here. If I believed in God, I'd become Amish for Christ's sake! It's the only way to get off of this merry go round!

Two words

[TVmisGuided]

AdBlock Plus.

Important to remember

[sasparillascott]

Advertisers are Facebooks customers, users are the product - and the company (led by its senior executive leadership) has a history of making ethically unsound decisions with "their" product (i.e. users) and there is no reason to expect those poor decisions (with regards to its users) to stop.

I've heard one person remark that Facebook stripmines their users personal details & that seems to be an accurate analogy for how the company operates. JMHO...

Dress sweat pants

[Nimey]

Dress sweat pants are a thing, which I know only because of Facebook.

Banner ads are ineffective ...

[CaptainDork]

Facebook and other online "commercials," are going to have to borrow from the more mature TV advertising business model and fold ads in with content. Product placement will increase, as well.

The other day, on Jeopardy, the category was, Ford Models. The answers were, like, Explorer, Fusion, etc. Blatant advertisement.

On Shark Tank, the sharks did a schtick where Barbara says, "Oh, let me take a picture of that using my smart phone on T-Mobile!"

Regular program-interrupting ads are doing the job.

Online sites have much more malleable tools to work with. There will be more targeted ads, ads embedded in the content, and content will be blocked for those using ad blockers.

Email spam is so yesterday.

Content-embedded ads is the way to go.

Re:Banner ads are ineffective ...

[wisnoskij]

In content ads have always been a thing, for example the number of starbucks cups in Fight Club is a well known joke (hell there is some site called starbucksfightclud that exist only to document these cups). And The Philadelphia Experiment had like a 2 minute advertisement for the brand new futuristic coke in an aluminum can. But some ads nowadays have taken it to extreme, such that if I am going to continue watching a TV series is as much about the ads as anything else. Castle, season 1, had an entire episode devoted to some espresso maker, which continued to guest star in subsequent episodes. Like the story, itself, was based around this amazing espresso machine. Carefully arranging sets to highlight product labels is bad enough, and taking time out of the show to actually have the actors comment on how great this product is is far worse, but having the writers base the entire story around some product[s] completely kills the show.

Missing the bigger picture

[Anonymous Coward]

No one has commented so far about the creepiest aspect: according to the NYT article, Facebook knew how many of the people they showed the ads actually bought the product.

You see, stores sell your personally identifiable information regarding everything you buy to data brokers, and Facebook bought the data from the data brokers. Ergo, FB knew what percentage of people they showed these ads subsequently bought the product.

It's enough to make me seriously reconsider using anything but cash for certain purchases. How many insurance companies buy data regarding your alcohol and tobacco purchase frequency, for example?

Re:Missing the bigger picture

[Anonymous Coward]

Don't be ridiculous. That's called "conversion tracking", and it is neither new nor a Facebook invention. It's the very basis of affiliate marketing.

The short version

[slashmydots]

My dad is a christian mobile DJ. So I ran a targetted ad campaign to anyone marked as "engaged" and christian in a 100 mile radius. He got about a million views and it cost several hundred dollars and he got a grand total of zero leads. We even had several hundred clicks. We're the best in the area, have a perfect reputation, and our prices are very competitive. Also I personally made out website so there's really no reason that anyone should see it and decide against us. We also have no competition whatsoever in our area. So either Facebook was lying to us and people are ad-blind and all the clicks were accidental or fake or something even worse is happening. Either way, it doesn't work.

Yes, indeed

[davebarnes]

A great idea.
I do like AdBlockPlus though. I did not even know that Facebook had ads.

Re:I can see why

[fisted]

Me neither, except the other day where i accidentally clicked one. I nearly killed myself out of shame.

Re:Not me

[fisted]

Dude, but you should totally look into this one weird trick to boost your sexual potential!

Re:I can see why

[Dishevel]

Isn't linking to a paragraph on a paywall just a horrible shitty advertisement as well?