Facebook Advertising Sucks? Nope, CPM Sucks. (and Widgets = Advertising 2.0)

Hell No.

Lots of folks chiming in on how Facebook [CPM] advertising isn't effective. 

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).

Comments

[robert]

Good post.

Facebook platform will definitely help many entrepreneurs launch their applications. Start with Facebook, get a huge userbase, and then expand outward from there.

Developing for Facebook doesn't mean you have to stay on Facebook. It means you can have a rapidly growing userbase specific to Facebook, while implementing features that can be useful outside of the closed network.

[Fergus Burns]

Amen. Great post.

Totally agree - expect to see some announcements within the next 2 weeks from a UK retailer

Talk soon
Fergus

[Marco Hansell]

Great article...i've long seen the coming of Widget Advertising as THE new model. It only makes sense...theres only but so much you can do with a traditional ad...as in NOTHING. Widgets are going to become the outlet through which a brand can push a nearly complete value proposition to consumers, and where consumers can talk back to them and tell them what they care about and DONT care about.

I'm loving it and doing my part to make sure this era hits BIG.

[deb schultz]

Amen brother!

[Mark Taormino]

Facebook just seems totally lame and boring... all of them... Facebook, MySpace, Craigslist, Friendster, VIRB they still don’t have MULTIPLE PAGES and more features like my site does - like 75 song MP3 players, attaching WAVS or MP3s to PICS etc - UNLIMITED photos. You can be WAY more creative on mine. I just don’t have the capital to advertise properly. None of the other sites are REALLY INNOVATING, look at www.upcrowd.com IT IS way better than the rest, it just needs serious word of mouth and unlike the other sites, I really did make it myself! :)

[James Hart]

Try my site LifeConnect out and see if you like the layout. I'm always looking for good feedback.
Thanks,
James Hart, CEO
LifeConnect.com

[Sharon]

deb schultz... page cannot be found for upcrowd.com. *impressed*

[Mark Taormino]

LMAO... It has been up solid, everyone else is logging in each day, try it again! :) www.upcrowd.com

[Tony Wright]

Hrm...

Facebook is a utility app for most people-- they are simply going to be blind to any ad real estate. And Facebook is built upon the trust of the NETWORK (the people you know). If it's well-labeled as "sponsored", the ad (or ad that looks like a widget) will be dismissed.

Your post boils down to "these ads are going to be really really really targeted", which can be true... But you can make the same statement for ads within Gmail-- when was the last time you clicked-- or even LOOKED AT-- one of those?

Of course, you might be right... As you say, it's pretty much what Google did. Though I think Google has an easier time of it in that they are catching people while acting on their intent... Every search on Google.com is an opportunity for an advertiser, while 99% of what people do on Facebook cannot easily be mapped to immediate advertiser-friendly intent.

[Capt.]

Facebook itself is run by sad people. They disabled my account, because, I had too many friends!!!! Facebook rules on adding friends, sucks! The ONLY reason I can see for it, is that the people at Facebook are jealous of people who might know more than a handful of people, as they are a bunch of sad geeks and never get out much.

Hey Facebook, WHY DON’T YOU GO BACK TO RUSSIA!!! YOU COMMUNISTS!

Capt. "Wild" Bill Kelso, USAF