Earlier this year, Facebook let the world know it was undertaking a new Social Ads program which would allow advertisers to “pair their ads with their social actions”. This whipped up privacy watchdogs into a lather, mostly since Facebook’s previous attempts at this sort of thing included the doomed Beacon. That service had to be discontinued after a class-action lawsuit demanded its death over those same privacy concerns. Now, it looks like Facebook has taken the lessons learned from those mistakes and gotten it right.

This week at the TechCrunch Disrupt conference, the product director for Facebook Ads, Gokul Rajaram, revealed that Facebook’s new social ads are now running on the majority of Facebook page views. According to Rajaram, they improve Facebook’s advertising effectiveness significantly. Here’s a rundown on how they work and how your business can take advantage.

Facebook Calls Them ‘Sponsored Stories’

If you are looking for “Social Ads”, you aren’t going to find them. Facebook calls them “Sponsored Stories”. You can see how they define them in the video below, or visit their help page on the topic.

Specifically, they state that sponsored stories improve brand lift and ad recall, which together are a holy grail that traditional marketers have been after for decades. In fact, in the interview at TechCrunch Disrupt, Rajaram stated that they had 68 percent higher brand recall than standard Facebook display ads.

When Buy Facebook Sponsored Stories?

If you’ve already established a solid Facebook presence and a number of connections, you can explore Sponsored Stories.

First, go to your Facebook dashboard. If you don’t have one yet, you’ll be prompted to sign up. Check “Sponsored Stories” rather than “Facebook Ads”, and pick what you want to promote. Note that you’re limited to fans of your company’s page and their connections; this is why this is only a good option for businesses already established on Facebook.

You can either choose to promote a specific product or feature with a link to a blog post about the subject, or you can choose a “Like” ad where your devoted fans advertise to their friends that they like such and such a company. No word from Facebook on which is more effective, but both have their place. The first can be used for specific promotions, while the second can be used to get a broader following by encouraging friends of connections to like your page.

When Would I Buy Facebook Ads?

Right below “Sponsored Stories” in your dashboard, you’ll see “Facebook Ads”. These are the standard display ads that you see on the left hand side of your screen. You’ll note that you can choose to target the ad to anyone you choose, including the Friends of Connections setting that is used in the Sponsored Stories by default. You would choose this option to build up your initial Facebook presence to a point where Sponsored Stories would actually work for your company. You can also only target local customers with the “Facebook Ads” option, which makes this attractive for local businesses that want to build a Facebook presence and let local buyers know they are there.

Where Does This Fit in my Marketing Plan?

If your marketing plan includes building brand recognition on Facebook, Sponsored Stories are the way to go. These new ads are particularly effective if you want to micro-target customers by zip code, city, or state with a particular promotion.

If you have a small, local business that doesn’t really care so much about where you end up in search engine results but want to connect with real-life customers, Facebook ads may actually make more sense than a Google AdSense campaign. If your budget is small enough that it is a choice between the two, try one for a month and then the other for the next month to see how well you do. The results may be surprising.

If you sell online only, targeting by interest with the double shot of Facebook Ads and Sponsored Stories can only help your brand, but you’ll obviously want to keep your current search engine pay-per-click (PPC) campaigns going to stay strong in online searches. Remember that Facebook advertising is mostly about branding, while traditional PPC search engine campaigns are more about sales.

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