No surprises there really. And it's not that Facebook advertising sucks; rather it's old-school BANNER advertising that sucks. But haven't we already figured that out from the direction of YHOO (down) & GOOG (up) market caps in the past 5 years? C'mon folks, this is old news.
The real story people are missing here is that CPM advertising itself is dying -- and it should, because it's a crappy industry with terrible adoption and shitty sales practices. Seriously: what part of a business with click-thrus measured in tenths of % adoption rates makes sense to you? Doesn't that SCREAM crappy business model? Isn't that why Google deprecates Adword campaigns with <1% CTRs? ISN'T THAT WHY SEMEL GOT BOOTED OUT OF YAHOO ON HIS ASS?!?
Advertising needs to innovate. And i'm not just talking about Google's CPC or even new forms of CPA-based advertising. Google has certainly helped change the industry, and they're quietly creating an analytics monoply no one has really noticed yet (note to self: next blog post on that conspiracy ), but the next revolution in advertising is desperately overdue.
The Revolution Will Not Be Televised. It will be Widgetized.
Fortunately, that revolution is already happening... it's called widgets. and Facebook apps. it's about engaging users via application workflow, and discovering intent. then you don't have to advertise anymore, you just serve up the stuff that users find interesting. gee, doesn't that sound similar to what Google did via Search & Adwords & Adsense? and what Facebook is doing via Social Networking & Facebook Apps. and what MySpace / LinkedIn wish they hadn't stepped on / ignored respectively (they'll get there, but they're late). and ultimately, it's what companies like Slide, RockYou, HotOrNot, Photobucket, Widgetbox, Clearspring, Yourminis, and others are all working on right now. they're trying to create a generalized set of component application platforms (aka "widgets") to discover user intent, and provide matching content & functionality... and in the very near future, charge for it.
in short, the next advertising revolution is all about the wonderful opportunity to kill advertising via apps & widgets that don't really feel like advertising.
Advertising is Dead. Long Live Advertising (2.0).