What's Hot in Remarketing: Facebook Ad Exchange

By Nelson Hudspeth | Dec 11, 2012
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In June of this year, Facebook finally revealed their new advertising format, Facebook Exchange (FBX), which is now out of the Beta stage. Facebook Exchange is a real-time bidding system where visitors to non-Facebook websites are marked with a cookie, and can subsequently be shown real-time ads related to their web browsing history when they get back onto Facebook. These ads are located on the right sidebar of the Facebook website, mixed in with Facebook’s other advertising offerings.

Remarketing is not a new concept for advertisers; Google has been doing it through their display network for years. So what makes the FBX any different? First, this is the first time Facebook’s “walled garden” of inventory and audience has been made available for remarketing and measurement.  According to Facebook, 955 mil+ people globally spend over 6 hours per month on Facebook’s site. The sheer scale of that is hard to comprehend! These users are loyal, spend a lot of time there, and come back often. Also, according to ComScore, Facebook serves up over 25% of all U.S. display ad impressions, and unlike other exchanges, FBX generally offers a more consistent and stable audience for targeting purposes.

Jackie Chan can’t handle the awesome

Facebook Exchange ads allow businesses to remarket to visitors of their websites whenever they next visit Facebook. For example, a shopper has been checking out an MP3 player on Best Buy. When they come back to Facebook, they can show the user that exact MP3 player they were looking at buying. Since FBX is a dynamic platform, ad creative and bid pricing decisions are made in real-time.

In the short time since its inception, click through rates have been close – or better – than other current ad exchanges. Adam Berke, president of AdRoll, has already helped launch FBX campaigns for over 60 clients. Across all campaigns they have run, AdRoll has reported an average ROI at 16 times what they generally see on more traditional CPC campaigns. Berke says the reason for this is that Facebook users tend to be highly engaged, and these new FBX campaigns allow advertisers to reach millions of users that otherwise have been previously unavailable.

How are ads seen on FBX?

Over a dozen Demand Side Platforms (DSPs) have already integrated with Facebook since they began their alpha earlier this summer, and recent press is showing very strong enthusiasm across the industry. Triggit, a platform enabling advertisers and agencies to build, run, measure & optimize retargeting-driven display campaigns, has prepared a chart showing traditional ad exchanges like Google’s DoubleClick Ad Exchange (on left) compared to Facebook’s Exchange (on right). Google tends to sell most of their ad impressions at night, when people get home from work. Facebook Exchange, in comparison, sells more than half as many ads at 10am as it does at 6pm.

Traditional Exchange ads on left & Facebook Exchange on right. Notice any differences?

The Next Big Thing?

Facebook has a potential goldmine on their hands. The beauty of this exchange is the relevance to users. FBX means that users can see more ads for things that actually interest them, rather than the status quo of irrelevant, annoying advertisements. The Facebook exchange seems to be ideal for marketers who are looking to expand their exchange-based remarketing and behavioral targeted buys across Facebook’s 955M+ global monthly active users. While this new platform doesn’t replace existing social media strategies such as sponsored posts, page post ads, etc., it is an incredibly powerful way to turn that brand awareness & interest into conversions & ROI.

To get started with Facebook Exchange advertising, contact your preferred Demand Side Platform or Agency Trading Desk. Go to Facebook Exchange, select More Options and click Facebook Exchange through Real-time bidding.

Please feel free to post your comments and experiences below, or find me on twitter (@Nhudspeth4) to continue the conversation!

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