Facebook Touts Branded Goods As “Engagement Ads”; Honda Connects To 1.5M Users

By Alicia Ashby On April 9, 2009 · Leave a Comment

Yesterday Facebook COO Sheryl Sandberg addressed execs at the AdAge Digital Conference, giving advertisers an old pitch with a new name, reports CNET. While Facebook was announcing its 200 millionth user, Sandberg talked up the virtues of branded virtual goods campaigns under the name "engagement ads."

The specific example Sandberg used was a promotion with Honda in which the company provided 750,000 free virtual gifts for Facebook users to gift each other. The gifts were fuel gauges shaped like hearts. Sandberg stated that all of the gifts were gone within four days, providing 1.5 million points of user interaction with the Honda brand through the promoton.

Well, Sandberg alleges it was 1.5 million individuals, but we have no way of knowing whether or not users were allowed to give the free gifts to multiple friends. Either way, that's still 130 million Facebook page views that featured a Honda branded virtual gift. The idea seems to be emphasizing that the branded goods allow
Facebook's users to interact with the campaign at the same high level
of engagement they would bring to interacting with any other Facebook
feature.

"Social media has had to do some evolution, some work to come up with
the right ad products, and we find that we are really first on that
path now," said Sandberg. "Banner ads that interrupt your experience, or
text ads, we don't think work as well in this environment. It's
actually just in the last year that we were able to launch ads on our
site that behave the way the rest of our site behaves."

Clearly, Facebook believes that a branded virtual good or gift is an ad that does behave the way the rest of the site does, because it offers users a point of interaction. Facebook announced engagement ads back in August, with virtual gifts as one of the three types of engagement advertising the site would support.

The other engagement ads involving letting users become a fan of a product webpage or leave a comment directly within an ad. While there's no revenue figures available yet to demonstrate whether Facebook's new approach to advertising is working for it, the move away from click-through ads could go a long way toward easing the company's monetization woes. Startup AdNectar has already had success with branded virtual gift promotions involving third-party apps on the platform, so there's no reason for Facebook not to be getting involved with advertisers themselves.