How Facebook has quietly created a gold mine for marketers

Inside the huge banner opportunity created by Facebook

Facebook’s development schedule epitomizes the “white water, fast iteration” approach to serving company and customer. Although its mishaps are legendary, it succeeds in consistently fielding a mind-numbing array of features, so it is difficult to keep up and very easy to miss the significance of things.

To wit, very few people people have noticed that Facebook has quietly revolutionized banner ads through a feature that is maligned by users but gold for marketers. This feature has created two opportunities for e-commerce marketers: a new means of inexpensive market research and an easy way to improve relationships with their viewers.

Read on to do this to your competitors before they do it to you.

‘You have removed this ad’: A spark in a dry forest

I hope you have used the “remove this ad” feature that Facebook introduced, I believe, in Q4 2009 or Q1 2010. When you mouse over most Facebook ads, you will see an “x” in the far right (1 — see above). When you click the “x” to remove the ad, you get the dialog box beneath, which gives you the radio buttons (2) and the all-important “other.” When you hit “Okay,” you get the gold box. Seems innocuous, right? Wrong. It has begun to change the expectations of your prospects, who will increasingly expect to give feedback on all ads.

Removing ads: Customer viewpoint

I have been using “remove this ad” since it was released, and I have noticed several things about it:

• There’s very little talk about it online. Any dialog is dominated by users who hate “remove this ad” because they hate ads in general and they would like “removing” the ad to be permanent (i.e. bar chart brains would never reappear). Note that the gold box doesn’t promise banishing the ad. Users don’t care, though.
• I’ll hypothesize that only a small portion of Facebook users bother to give feedback, but I’ll wager that most of those who do want to do it everywhere.
• Yes, when you remove the ad, it isn’t banished from your land forever, but clicking the “x” and adding a peppery comment can be satisfying anyway.

Removing ads: A marketer’s viewpoint

Now, think about yourself as a buyer of millions of dollars of banner ads per year, which all CMOs do. What if, for appropriate (geeky) segments you would introduce this functionality in some of your banner ads (not necessarily on Facebook)? This would help you:

• Conduct low-cost market research by collecting responses; on Facebook itself this is particularly interesting because Facebook knows user demographics. However, off-Facebook, wouldn’t you like to know if readers of certain sites find your ads offensive or …? (you design the responses)

• Improve your relationship with prospects when you give them the option to respond; you suggest that you are interested in their viewpoints.
• You can take this into account when selecting your ad mix. You read it here, in 2011: The majority of “display” ads will be selected by customers within 10 years at the outside; certain demographics much earlier.
• I recommend pilots this year to get ahead of the market. Of course, many of your ads are syndicated, etc., but you can select specific situations to experiment and learn.

• This is another example of how disruption happens: Remember that inane idea by the inflated company in Cupertino? A “touch screen” phone? “That’ll never work!” Now everything has to be touch. Get ahead.

Under the hood: Social actions

Facebook’s DNA is encouraging social actions, which are digital transactions within a social context, because social actions give insights into the social graph. I’ll wager that Facebook regards “remove this ad” as a private social action, between users and Facebook and their clients. They have a business to run, and they are going to optimize impressions to make money. Over time, they will be able to show users more relevant ads, which is why I’ve committed to giving them feedback when I have time. I’m educating their algorithms.

Conclusions

• The very suggestion that users can “remove” ads is brilliant: Not only can you make that ad disappear, you can give the reason. Most banner ads will have that feature in the medium term, depending on user/reader demographics.
• If marketers truly care about the people with whom they are trying to communicate and influence, they will appreciate that feedback and use it to focus their efforts better. What if you could increase clickthrough 2x, 3x by using in-workstream customer feedback? Some firms will.
• You can outdo Facebook by giving readers more ways to indicate approval of ads. Facebook has several reasons for removing an ad but only one way to indicate approval (“like”). But that will change. You can lead.
• Bottom line: if your brand uses online ads, begin experimenting with this feature in 2011. Work with your viewers, not against them.

What do you think of Facebook’s “remove this ad” feature? Do you like it or use it? Tell us in the comments!Christopher S. Rollyson is a partner in Socialmedia.biz and managing director of CSRA, a management consultancy that advises enterprises and startups on social business strategy and execution. Contact Christopher by email, follow him on Twitter and Google Plus or leave a comment below.