This article was published on March 26, 2013

Facebook extends its Exchange ad retargeting service to the News Feed

Facebook extends its Exchange ad retargeting service to the News Feed

Today Facebook announced a key change to its advertising products, allowing advertisements placed through its Exchange service to be placed directly in the News Feeds of users.

Previously, ads serviced by the Facebook Exchange program were limited to the right-hand column of users’ screens. Facebook cites the News Feed as the part of its service in which users spend the most time.

In short, ads delivered via retargeting do not lean on Facebook graph of user data and likes; they instead depend on a person’s browsing history. Thus, Facebook is selling ads in its key real estate that aren’t based on its competitive advantage: user data.

This is no small shift, as AllThingsD’s Peter Kafka noted in a post on the new policy: ” If you’re going to sell ads on Facebook the way they’re sold all over the Web, then what makes Facebook different than Yahoo, AOL or any other big site with a ton of impressions?”

The question becomes why Facebook feels it needs to boost retargeted ads in this way; why is demand for them so high that it has to allow the ad variety to shunt its own ad products aside? Facebook doesn’t intend to increase the number of advertisements shown, and users will likely not notice the difference between the new and traditional ads in their News Feeds.

The new policy is in what Facebook calls “closed alpha test.” It will be extended in time. Also, the new ads are desktop-only for the time being.

Retreat, or smart policy by Facebook to allow it to drive more revenue and keep its shareholders happy? Por que no los dos?

For more on Facebook and its travails with advertisements, our own Martin Bryant’s take on the company’s mobile ad work is worth reading.

Top Image Credit: Acid Pix