Need any more proof that Facebook is getting into the ad-network business? Check out its romantic overtures to big advertising agencies: AdAge reports the company has been sending chunks of carved plastic up and down Madison Avenue, inviting ad buyers to an event on November 6. Now, a Lucite brick costs about 30 cents. You can send a virtual gift on Facebook for less money than that. Despite its cheapness, though, the campaign shows that Facebook is serious about getting into advertising, and that CEO Mark Zuckerberg is a believer in his company's ad-targeting technology.
When I wrote the other day about Facebook's advertising ambitions, blithering Googlephiles filled the comments, nattering on about "search queries" and "intent." There is more to advertising, though, than spur-of-the-moment intent. Targeting ads to search keywords works, unquestionably. But there's a host of advertising dollars that are spent, today, on the basis of targeting specific demographics and interests. And they're spent not on the expressed intent of a search query, but the latent intent the advertiser believes exists in his target market.
Heck, some advertisers even want to generate intent where it does not exist today. I realize that concept will blow the minds of many in Mountain View, but it will surprise exactly no one on Madison Avenue.
Others critiqued my analysis from another angle — that Facebook could only target ads on, well, Facebook.
Utter nonsense. How long has DoubleClick been around? The notion of targeting ads on one website based on information garnered at another has been in practice for about a decade. For Facebook, extending its advertising to other websites isn't just a no-brainer; it's technically trivial and a well-established practice in the market. And Facebook, with highly trustworthy information on users linked to their real identities on campus or in a workplace, could target ads more effectively, and more lucratively, than most other advertising networks.
Here's the question Google advocates need to ask themselves: Is your identity best expressed by what you search for on the Web? Or is it, rather, the sum of your relationships? That's the big question everyone from Madison Avenue to Silicon Valley will be asking over the next few years as this battle plays out.
Let's be clear, though. The valuation Facebook is reportedly seeking, $15 billion, prices the company for perfection. And unlike Google, which managed to grow its advertising business in relative secrecy, Facebook faces a relentless, glaring spotlight. It would be easy for Zuckerberg to screw this up. Let's hope that his embrace of Madison Avenue extends beyond just mailing hunks of plastic.