January 11, 2014
Facebook To Kill Off Sponsored Story Ads
Bryan P. Carpender for redOrbit.com - Your Universe OnlineHuffington Post reports that Facebook notified ad partners and developers this week that it would be phasing out the ad style and gave them a timeline for the change to allow them to make necessary adjustments to their campaigns.
AND NOW A WORD FROM OUR SPONSORS
According to Facebook, Sponsored Stories "are messages coming from friends about them engaging with a Page, app or event that a business, organization or individual has paid to highlight so there's a better chance people see them."
That’s one way of putting it. Another way is to call them what they are: advertisements. They use a person’s profile picture to let you know that this person "likes" the advertiser. It turns the very act of clicking the "Like" button into a potential commercial endorsement. Either way you look at it, it’s an endorsement from a (hopefully) trusted source.
These Sponsored Stories give you insight into what your social network is up to, what they are into and where they are visiting – either online virtually or in the physical world. If one of your friends checks into a business, that action would appear in your news feed. If they "like" a product, you see it. They’re word-of-mouth recommendations for today’s tech savvy and social media obsessed world.
"I get to see what my friends are recommending or telling me is awesome? That sounds harmless enough." Except that it created an outcry from privacy advocates, along with no small amount of controversy. It turns out that not everyone liked the idea of their name and picture being used for the purposes of promoting a given product or business.
CONTROVERSY AND COURT FILINGS
Facebook launched the feature in 2011 and that same year, it was slapped with a class-action lawsuit which claimed that these sponsored stories were in violation of users’ rights by making public their individual "likes" and tracking their online behavior, all without giving them the chance to opt out, nor were they offered any compensation for their endorsements.
From January 2011 through August 2012, these Sponsored Stories earned Facebook over $230 million, according to court filings. That’s major ad revenue resulting from leveraging individual users’ personal information and postings.
Adding to the controversy was the argument made by child rights advocacy groups that minors should not have their content shared with advertisers. While minors had the ability to opt out and adjust their settings, these advocacy groups felt that anyone under the age of 18 should be automatically opted out.
YOUR TWO CENTS’ WORTH
Facebook settled the lawsuit in August 2013, according to Wired, for $20 million, along with a pledge to give users "more control over how their content is shared." (Before you start checking your mailbox for a check, you should know that the settlement amounted to around $0.02 per Facebook user. That is, provided they filled out the proper paperwork to claim their reward. It might not be worth all the effort to get your two cents’ worth – literally.)
DON’T FORGET TO READ THE FINE PRINT
Just because Facebook is sending Sponsored Stories off into the sunset, that doesn’t mean it won’t be able to use some of the same methodology to generate ad revenue.
In its blog post on Thursday, Facebook asserted that they were streamlining their ads: "Last year, we announced some changes to simplify Facebook ads, including eliminating different types of ads that had the same purpose and making our ads look more consistent. We also announced that marketers will no longer be able to purchase sponsored stories separately; instead, social context — stories about social actions your friends have taken, such as liking a page or checking in to a restaurant — is now eligible to appear next to all ads shown to friends on Facebook."
Given all this information, users not comfortable being used as a veritable pitch people for whatever business, product, company, app, service, restaurant or anything else they might "like" might want to review and update their Ads and Friends settings. (We’re talking to you.)
While this coming April marks the end of Sponsored Stories, the fact remains that advertisers need to harness the power of social media now more than ever. An advertisement with a social endorsement aspect is as good as gold to advertisers. Nothing resonates with a consumer more than a personal recommendation – especially if it’s from someone they know and trust.
However, it’s still up to you whether or not you want your endorsements to help sell products for these advertisers. Decide if you "like" that idea, then act accordingly; it only takes a few mouse clicks. You have the power.