Note: this is cross-posted on the Threshold Interactive blog.
Facebook today launched a new feature for advertisers that repackages certain social actions on the network – say, a check-in at your favorite retail outlet – into a “Sponsored Stories” ad unit that will run in the right hand column on the site. Facebook has attempted to sidestep privacy criticisms by building a users’ privacy settings to the ad distribution – that is, only those friends within your network who would have already seen your check-in or other social action will be eligible to see the ad bearing your name and likeness.
This is a big step for advertisers as they will be willingly absolving themselves of the creative unit – context and content will be determined by the user who penned the status update in the first place. That is a fairly significant mindset shift for a lot of advertisers.
The bigger question here is the potential impact of this announcement on users. Facebook has a track record of challenging privacy issues including its now infamous Beacon program that was shuttered in 2009. Sponsored Stories is bound to draw criticisms stemming from the inability to opt out of being featured in an ad, and questions about whether Facebook can sell and profit from the written word of its members in this manner.
Of particular note to that last point – Facebook expressly prohibits users themselves from leveraging their personal profiles for commercial gain. This is a clause from its current Statement of Rights and Responsibilities:
So Facebook can sell status updates (or the sponsoring of said updates) to an advertiser, but users themselves are not allowed. There is a delicious irony there that is bound to be the target of attention in the next few weeks. Stay tuned for the ensuing debate.
Here is the full Facebook video with additional details.