Facebook Ad System Puts Business and Butterflies Together

Facebook has thrown down the gauntlet in front of Google, introducing an online ad platform designed to help businesses reach its social network of 50 million users.

With industry pundits predicting that Facebook would usher in a new era of socially-networked advertising, the Palo Alto, Calif., company introduced Facebook Ads, an ad system to help businesses target advertising to audiences they want through friends referrals.

Facebook Ads, announced by CEO Mark Zuckerberg at an event in New York on Nov. 6, also includes an ad system that spreads brand messages virally through Facebook Social Ads and an interface that can be used by marketers to gauge relevant user activities on the site.

Zuckerberg introduced Facebook Ads with the support of key partners, including Blockbuster, CBS, JPMorgan Chase, The Coca-Cola Company, Microsoft, Sony Pictures Television and Verizon Wireless.

Click here to read more about Facebooks pledge to get into online ads.

To champion Facebook Ads, more than 100,000 new Facebook pages launched today, allowing users to interact and affiliate with businesses and organizations in the same way that they interact with other Facebook user profiles.

Businesses can add photos, videos, music and Facebook Platform applications. Moreover, third-party developers have created applications to enhance Facebook pages, allowing users to book reservations or share reviews of restaurant pages.

In one example, Coca-Cola will feature its Sprite brand on a new Facebook page, inviting users to add an application to their account called “Sprite Sips,” which will allow users to create an animated Sprite Sips character they can share with their friends on Facebook.

Zuckerberg said advertising messages will be distributed through the social graph, a network of connections through which people get together and share information online. When people check out a business Facebook page, they will trigger the spread of information about that business throughout the social graph.

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Facebook Ad System Puts

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Users can share information about businesses with their friends and interact directly with the business through its Facebook page by adding reviews or uploading photos.

“The core of every users experience on Facebook is their page, and thats where businesses are going to start as well,” Zuckerberg said. “The first thing businesses can do is design a page to craft the exact experience they want people to see.”

To read more about Facebook parting the walled garden, click here.

Facebooks ad system benefits advertisers by serving Social Ads that combine social actions from users friends with an advertisers message, allowing them to deliver more tailored and relevant ads to Facebook users. Social Ads can appear either within a users News Feed as sponsored content or in the ad space in the left side of the site.

Facebook said no personally identifiable information is shared with an advertiser in creating a Social Ad.

Facebook Ads comes weeks after Zuckerberg said on Oct. 17 that Facebook would delve into online advertising.

By offering a way to target ads for social networks, Facebook has opened up a new front in its competition versus Google and MySpace to corner a new online ad market.

To wit, Facebook Ads also comes on the heels of MySpaces Nov. 5 announcement of SelfServe by MySpace, a new targeted advertising platform designed to allow small business owners, bands, and politicians to buy, create and analyze the performance of ads throughout MySpace network.

The SelfServe by MySpace lets users select from a number of ad-targeting factors, including geography and other demographics. SelfServe participants can use the customized tool to pay for their ads and initiate placement. SelfServe by MySpace users will also have access to analytics tools to let them track their ad performance.