Continuing rumors about the much-anticipated November 6 Facebook/Microsoft ad platform announcement today posit that Facebook will implement “SocialAds”: a system that cookies users and targets them based on their stated profile information in off-Facebook advertising. Nick O’Neill of AllFacebook writes that this is a boon for Microsoft and a direct threat to Google AdSense:
Thanks to their advertising partnership, Microsoft will now be able to provide targeted ads not only based on demographic data (location, age, gender, etc), but they will also know that the person visiting your site is interested in skiing and guitar. So how much money will Facebook make from this? A ton. Higher CPMs and CPCs will create a new competitive landscape between Google and Facebook. Facebook to Google: we are gunning for you.
Ignoring for a moment that information on social networks is not always true, it’s clear that Facebook data is far richer than what online marketers have now. Moving the ad model off Facebook would address the social network’s notorious problem of low click-through rates.
What will users think? In another AllFacebook post, Dan Lester astutely notes that users likely will express initial dismay, then forget all about the implications of their Facebook data following them around the web.
Several blogs note that the $240 million stake in Facebook that Microsoft just purchased would make a great deal of sense if these rumors are true. Still, calling SocialAds a Google Adsense killer is a bit premature, especially considering that Google has its own social network-related announcement coming sometime in the next couple of weeks.