Facebook is gearing up for a new project to simplify its advertising platform, making it easier for marketers to decide how to place ads across the site.
One of the plan's major goals is to reduce redundancies in the 27 different types of ads that Facebook currently offers to marketers, by either getting rid of some options altogether or merging some tools into one product. Many of the types of ads Facebook currently offers do a lot of the same things, such as encouraging online sales, in-store sales or in-app downloads, the company said.
For example, Facebook provides an online Offers product to advertisers to let them drive traffic to their website or product page, but many companies just insert a link into a Facebook Page post to drive traffic, so the option to create a dedicated online offer will disappear under the changes, Facebook said.
Because the program is still in its very early stages, many of the changes either were not disclosed or are still being worked out. The company announced the project during a briefing with reporters on Thursday at Facebook's headquarters in Menlo Park, California. Most of the new advertising tools will not roll out until late summer or early fall.
For Facebook users, the project is designed to provide a more unified set of ad formats, so advertisements appearing in the News Feed, in the right-hand rail on the desktop and on mobile devices will look more consistent.
The new program is based on what Facebook has learned over the last year or so from marketers as more of them have opted to advertise on new areas of the site, such as the News Feed.
"A couple of years ago, the question was, 'Do Facebook ads work?'" said Brian Boland, director of product marketing at the company. "We now know that they do," he said.
Under the way Facebook sells advertising today, it presents marketers with a long list of options for how to advertise on the site and the marketers choose which ones to use to target their audience. In the future, Facebook will present a more streamlined set of options based on specific marketing objectives, such as getting users to go to a company's physical store or encouraging them to buy an app.
Instead of choosing among various ad products, companies will be able to tell Facebook they want to create an ad that, say, drives awareness of a message, or gets consumers to look at a video. Facebook will then put together a type of ad that will accomplish that.
"Facebook is starting to realise they need to really simplify what they offer to marketers and make what they offer actually social as opposed to traditional display advertising," said Zachary Reiss-Davis, an analyst with Forrester Research.
The project is aimed at reducing complexity, not control, for advertisers, according to the company. Companies will still be able to target and personalise their ads to certain audiences, but it will be easier to align those ads with their objectives, Facebook said.
Finding new ways to target ads to the right users is a perennial goal for Facebook. Last year the company rolled out its Custom Audiences tool as a way for marketers to target people they've previously done business with by using their phone number or email address.
The program was expanded in February to third-party marketing firms to give advertisers even more data for targeting their ads.
Earlier this year, Facebook also announced its acquisition of Microsoft's Atlas Advertiser Suite, an ad analysis platform. The acquisition was intended to increase Facebook's ad revenue and give marketers better information about their campaigns on both desktop and mobile.
Facebook's ad revenue for the quarter ended March 31 was US$1.25 billion, representing 85 per cent of the company's total sales and a 43 percent increase from 2012's first quarter. Mobile advertising revenue accounted for 30 per cent of total ad revenue.