What exactly are Sponsored Stories, and how do they work?

on February 1, 2011 | Australia Facebook | Comments (0)

If there’s one thing Zuckers has gotten much better at, it’s making money.  Lord knows with an active population greater than the entire North American continent, it can’t be hard.

The latest in his escalating advertising arsenal is the innocently named ‘Sponsored Stories’.  In reality, ‘sponsored’ is just another term for ‘paid’ and ‘stories’ is just another word for ‘advertisement’, but evidently Zuckers has a great spin-team who are trying hard not to rock the boat.  You can’t really blame them since the only thing facebook users like doing more than updating their statuses is complaining about the latest change to their profile layout.

So what exactly are these new ads? Well first of all it’s important to hear Facebook’s take: ‘Sponsored Stories are different from ads, and including them in your Facebook Premium Ad campaign amplifies the actions your target audience takes with your Premium Ads during a Target Block or Sustained Media.’  A simple translation of this would be “Sponsored stories are different from ads (because we have used the term ‘stories’ – clever aren’t we!) but really just another way you can give us money in return for annoying your target audience. Oh and it would really work best if you used them during another advertising campaign you have given us more money for! Yay!” [Please note hypocrisy since I currently pay to advertise on Facebook, and will probably also pay for this service in the future.]

The difference between Sponsored Stories and typical ads is that it leverages interactions that people have already had with your brand on Facebook (for example, liked your page or checked-in to your Places venue) and turns these actions into mini-ads visible to their facebook friends.  In this way facebook argues they act as more ‘word-of-mouth recommendations’, and I guess they do – albeit unintentionally.

As it is, when a facebook friend likes a brand, let’s say Vodafone (just to use the least likely example), it will appear in your newsfeed briefly, where you will then also have the opportunity to like Vodafone (though obviously you would sooner stab yourself with rabies).  The Sponsored Stories take this a little further by adding an advertisement (sorry, story) to the right of your profile/newsfeed (where all the other ads currently appear) like so:


These ‘Stories’ can be activated through page likes, application interactions, place check-ins and page posts – examples below:

For Page likes:


For application interactions:


For place check-ins:


For those pages who want to make sure they are staying top-of mind with their current fans, they can also choose to activate Sponsored Stories for their page posts.  Obviously your current fans may be exposed to your posts through their usual newsfeed, but the Sponsored Stories will make sure the majority actually see it, and it will be visible for longer.


So when is it available and how much does it cost?

It’s happening RIGHT NOW – even in Australia, where we typically have to wait a few years to get the latest Facebook upgrades.  The costs are the same as purchasing their usual Premium ads, which is roughly a $6 CPM for minimum spend of $10K, getting down towards $5 CPM for $100K spend.  You can also target based on age, gender and state.

Personally I think these are really good for big brands like Starbucks, McDonalds or Nike, where plenty of people know and like them enough to be hooked by a friend ‘recommendation’.  Or if you have developed an application that has viral potential, I can definitely see how these stories would help spread the word.  However if your brand is not so well-known, and you don’t have any fancy application, I doubt you will get many people liking your page just because their friend did.  In that case you are best sticking to Premium Ads, where you can at least provide some text along with your logo that will hopefully entice them to like you.

carapring :