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Facebook’s extension of Exchange to News Feed could “accelerate” marketers’ interest in biddable media, say agencies

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By Jessica Davies | News Editor

March 28, 2013 | 4 min read

Agencies have welcomed Facebook’s rollout of Exchange-delivered ads to its News Feed with some predicting it will “accelerate” marketers’ interest in biddable media while injecting more premium inventory into the real-time bidding (RTB) market.

This week Facebook began trialling the extension of Exchange to its News Feed as part of plans to increase its ad targeting capabilities.

Previously it was only possible to run ads that were delivered via the Exchange on the right hand side of the page. Facebook launched the exchange last June letting advertisers buy inventory in real time with the ability to target and retarget specific audiences.

Some agencies believe that opening up the ability to serve Exchange-delivered ads within the news feed could help boost spend in the RTB space in general.

LBi’s head of media innovation Andrew Girdwood said display has “found its wings” because of RTB. “Search saved display – all the innovators in the display space saw how the biddable landscape worked in search and moved it into display. Now Google and Facebook have moved in and it’s an exciting, rapidly developing area,” he said.

Girdwood believes the public is used to Facebook experimenting and changing things so does not believe the move will have a detrimental effect to users as the frequency of ads within News Feed is not likely to change.

“The fact that Facebook is using exchange technology to put ads in such a prominent position will only accelerate advertisers’ interest in biddable media and RTB in general,” he added.

Omnicom Media Group’s chief digital officer Paul Wright agrees, adding that the news could propel the topic of RTB into the brand marketing arena rather than solely direct response (DR). “It will raise the discussion about biddable media to a wider range of advertisers.

“The same would be true of Twitter with the opening of its API. So you are going from what has predominantly been a display DR buy into something broader. You could argue that the brand advertisers that have not been particularly drawn into biddable media might now be because it is Facebook that is doing it,” he said.

Agencies have also welcomed the fact the move will see an injection of premium inventory into the RTB space, which previously has been dominated by what most regard as remnant inventory.

However, Marco Bertozzi, MD for EMEA at VivaKi Nerve Center said marketers must be cautious when it comes to the level of frequency of ads served within the news feed. "The only risks are that the ads are far more visible and perhaps people don't want to have their previous site consumption plastered so visibly in front of them. Anyone who has been hounded by retargeted ads will very quickly get annoyed so there will be onus on the buyers to manage frequency," he said.

Meanwhile others believe publishers will be keenly watching the outcome of Facebook’s extension of Exchange-delivered ads to News Feed with regard to their own business models. LBi’s head of display Adam Russell said: “What’s interesting is the fact a big publisher is putting their premium inventory in the biddable space and presumably without any floor rates so letting the market dictate what they are worth.

“Lots of publishers will have their eyes on this. It will be interesting for advertisers as they can get access to this premium inventory but there will be as many publishers trying to understand what this means for them. You can be sure if this works for Facebook and it can get the scale and do this without cannibalising too much on its revenues and deprecating their CPMs then you can imagine there will be other publishers wanting to make a similar move,” he said.

Facebook is working with several demand side platforms (DSPs) on the alpha test, including MediaMath, Nanigans and Tellpart, before expanding the format to other DSPs and advertisers. Initially the tests will run on desktop but agencies expect it to roll out Exchange-delivered ads across mobile devices in future.

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