With social media advertising on the rise, Facebook is letting companies cash-in on its user base by introducing “Sponsored Stories.” Facebook users who check-in or post status updates mentioning a brand (such as Starbucks) can now appear in ads on the right side of Facebook pages.
Insight: Facebook unveiled a new advertising model for brands called “Sponsored Stories.” In concept, the new program is similar to Twitter’s Promoted Tweets in that brands are able to sponsor certain keywords or activities on the social network, but with a twist. Facebook’s Sponsored Stories are ads that will feature you and your friends. Here’s a short video detailing how it works.
Initial reports on the new service suggested a potential privacy backlash, but to-date there has been nothing of the sort. For companies making investments in Facebook as a platform for engaging fans, Sponsored Stories represent a compelling way to personalize the brand and target potential customers.