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Facebook’s New Timeline – How Will It Affect Ads?

James Connell September 30, 2011 Category Social Media

Facebook’s new Timeline will soon be going live for the general public (possibly as soon as this weekend), and we think it will have a pretty big effect on paid ads.  The question is, of course: what will that effect be on your Facebook Ad Management?  Let’s first walk through the changes, and then discuss effects.

 Changes to Facebook Ads

There are three immediately obvious ad changes: position, number of ads, and duration.  Here’s a screenshot of the current ad layout:

New Facebook Ads 1 There are 3 ads, and they are pretty much lost on the page, as there’s nothing to make them stand out from recommendations, people you know, etc.  Also, if one scrolls down the page, the ads disappear.

New Facebook Ads 2 Here’s how ads look in the Timeline:

New Facebook Ads 3There are now only two ads.  They stand out from the rest of the page’s content much better, and they stay visible as one scrolls down the page:

New Facebook Ads 4

 Effects of the New Facebook Ads

So, the Timeline pages have fewer ads, and those ads stay visible for a longer period of time.  This will result in a significant drop in total impressions.  Taken by itself, this drop would naturally result in an overall increase in bids and costs per click (CPCs), as advertisers fight over less inventory.  However, the change to a much more visible place on the page, as well as the increased duration of each impression, will most likely result in higher click through rates (CTRs) which, taken alone, would result in lower CPCs.  At an account level, these competing forces may simply cancel each other out, leaving account-level costs & clicks unchanged.  That said, the lower level of competition and longer duration for each individual impression should result in a wider range of separation between good ads & bad, enabling better optimization.

One variable we will be watching with interest in the Timeline is the effect of ad copy length on CTR.  We have typically found that shorter ad copy works better than long ad copy, all else being equal.  On the Timeline, however, we suspect that shorter ad copy may be less effective.  Especially if the ad is in top position, shorter ad copy will mean less separation between your title and image and the other ad’s title and image.  We will be testing this heavily in the coming weeks, watch this space for more analysis.

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