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Facebook Ads on the Social Graph – State of Social Advertising

May 10th, 2013

facebook social graph adsIn our view, a majority of current social ads are just ads on social platforms rather than social-enabled ads. These advertisements seem to boast no prominent differences with display ads on other online platforms (e.g. portals), which are primarily delivered on the back of user reach and visits. Currently, social-oriented platforms still do not seem to have efficiently leveraged the social/interest graphs of their users, although some pioneers (e.g. Facebook and Twitter) have been actively testing new ad formats to target better.

The State of Facebook Ads on Graph Search
Facebook launched a user-focused search service, Graph Search, in January this year, allowing users to search for the friends, locations, pictures and interests of a specific Facebook user. Three months after its launch, the company reportedly has begun to test Graph Search-based advertising. Unlike traditional search ads which are based on keyword inputs, the Graph Search ads will be centered key attributes of a user, such as age, gender, location, employment, “likes” and open graphs. We view the Graph Search ads as enabling the “social features” in advertising, thus possibly offering a unique value proposition compared to traditional online advertising formats.

In China, Tencent’s Guang Dian Tong is more of a social feature-enabled advertising platform. Based on cumulative user data from Tencent’s major social-oriented platforms (e.g. QQ and Qzone), Guang Dian Tong allows advertisers to target customers according to their attributes, thus improving the ad performance.

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