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Facebook Sponsored Results

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Background:

On August 23 2012, Facebook unveiled its latest Marketplace advertising product, Sponsored Results. The new ad format allows advertisers to buy ads within Facebook’s onsite search in order to promote their Facebook properties, such as Apps, Pages, or Places. Facebook has indicated that its onsite search functionality is highly used by its users, thus Sponsored Results will enable advertisers to increase awareness of and traffic to their Facebook properties.

How it Works:

Sponsored Results are search ads that drive to a Facebook App, Page, or Place. The ads will be marked Sponsored and will appear at the top of the search results instead of being mixed with organic results. For now, sponsored results can only appear for desktop searches and the ads will not appear on mobile devices or on the “more results” page. These ads are available through either Facebook’s Power Editor or a third party API partner, and can be purchased on a CPC or Optimized CPM basis. Facebook takes quality and price signals into account in determining the Sponsored Results ads that appear for a particular search.

The top organic search results are first ranked by Facebook according to relevance. Then, the ads system looks for Sponsored Results ads that target those entities, performs an ad auction, and determines which ads should show in the Sponsored section. A Top Hit will also appear if there is an organic search result that is very relevant to the user. Ads that perform poorly on quality and price metrics will fall out of the auction and not serve as often.

The maximum number of Sponsored Results that will show is three, while only two organic results can appear at one time. Users are given the option to hide the ad by clicking on the small “x” shown in the upper right hand corner of the ad. When a user chooses to hide the ad they are asked why they didn’t like the ad.

The Sponsored Result ad allows for 70 characters worth of customizable body text while the ad title and image are pulled directly from the Facebook entity that is being promoted. Sponsored Results promoting a page can be adjusted to drive to the timeline of that page or to a specific tab.

Any Facebook entity or group of entities can be targeted, versus targeting specific keyword strings like traditional paid search. In addition, interests and demographic/geographic criteria can be layered on to the targeting as well.

Performance and action tracking is available in Facebook’s Power Editor as well as through API partners.

Resolution POV:

This new Facebook Marketplace ad option offers marketers the ability to target the entities their target audience is searching for, as the Sponsored Results appear alongside targeted Apps, Pages, and Places. While the ads have the same character limitations and manner of discovery as Paid Search ads, the intent of users targeted on Facebook is narrower than that of searchers. Results will appear for Pages, Apps and Places targeted based on user engagement with similar entities on Facebook rather than expressed interests.

Currently, no benchmarks or directional data on volume are available from Facebook, so the real reach potential for searches performed on Facebook is not yet clear. As it is unknown what percentage of a brand’s total page visits are currently delivered from a search result, the implications of the introduction of Sponsored Results are difficult to predict. Resolution recommends testing to assess the potential traffic volume for a brand’s App, Page or Place and other relevant targeting.

Facebook recommends that brands bid on their own Apps, Pages, etc. to ensure that competitors don’t show above the organic result for that brand. This self-sponsorship is encouraged as it is considered less expensive than cross-sponsorships, and provides a better user experience. However, without data on search volume seen on Facebook, the added cost to brands to sustain their brand presence in the search results will also need to be assessed.

Key Considerations:

  1. The Sponsored Results ad can be used as a tactic to drive Facebook content discovery, providing a new way to increase awareness of a brand’s App, Page or Places.
  2. Businesses cannot direct users off of Facebook with Sponsored Results ads, and thus can only be leveraged today to deliver traffic to a brand’s Facebook entity.
  3. Sponsored Results may be leveraged to try and divert organic traffic from competitors Apps, Pages, or Places with similar audiences. However, testing will be required to determine how costly this approach may be based on Facebook’s algorithm.
  4. Similar to Paid Search, brands are at risk of competitors targeting their Facebook entities with Sponsored Results ads. While the product just recently launched, Resolution has already started to see this tactic being deployed by certain brands even if not in the direct competitive set.

Summary

As Facebook has reported that the search function is one of the most used features on its site, significant volume is expected for the new Sponsored Results ad format. In addition, Sponsored Results ads will help Facebook users discover new Apps and content that are similar to the Facebook entities that they engage with currently. However, this ad product is new and limited data was released by Facebook. Testing will be required to truly assess potential volume and performance for individual advertisers.

For more information, please contact your Resolution Media client service representative or Erica Barth, VP of Products & Partnerships (ebarth@resolutionmedia.com, 312.980.1689).