Facebook sponsored ads, also known as Facebook ads, are paid advertisements that appear on Facebook. They allow businesses to promote their products, services, events, and more to Facebook users. But where exactly do these sponsored ads come from and how do they end up in your Facebook feed?
What are Facebook Ads?
Facebook ads are paid ads created by businesses, organizations, or individuals to reach their target audience on Facebook. Unlike regular Facebook posts which are free, Facebook ads require payment in order for them to be displayed to users.
There are several types of Facebook ads:
- Photo ads – contain a photo and text
- Video ads – contain a video and text
- Carousel ads – contain multiple images/videos and text that users can swipe through
- Collection ads – promote a product catalog or group of products
- Lead ads – drive users to submit contact information
- Instant Experience ads – contain interactive app-like experiences
Facebook ads allow advertisers to target specific demographics, interests, behaviors, and more. They appear on the Facebook app, Facebook website, Messenger, and Instagram (owned by Facebook).
Who Creates Facebook Ads?
Facebook ads are created by a wide range of advertisers, including:
- Businesses – large and small companies across all industries purchase Facebook ads to promote their products/services, increase brand awareness, drive sales, generate leads, etc.
- Marketers – marketing professionals often manage Facebook ad campaigns on behalf of businesses.
- Agencies – advertising, social media, and digital marketing agencies help brands develop and run Facebook ad campaigns.
- Organizations – non-profits, educational institutions, government agencies, and other organizations use Facebook ads to promote their causes, events, recruiting, and more.
- Individuals – people also create Facebook ads for personal use cases like selling items, promoting content, boosting posts, etc.
To create ads on Facebook, advertisers use Facebook Ads Manager or work with an ad agency. Facebook offers training and certifications to teach best practices for creating effective Facebook ads.
Why Do Businesses Advertise on Facebook?
There are several key reasons businesses invest in Facebook ads:
- Huge audience – With over 2 billion monthly active users, Facebook offers an unparalleled audience size for advertisers.
- Targeting capabilities – Advertisers can target ads using parameters like location, age, interests, behaviors, and more to reach very specific audiences.
- Range of ad formats – Facebook offers numerous options like photo, video, carousel, Stories ads and more.
- Measurable results – The platform provides robust analytics on ad performance and optimization capabilities.
- Retargeting – Advertisers can serve ads to people who have already engaged with their brand to drive further action.
- Multi-channel – Ads can be run across Facebook, Instagram, Messenger and Audience Network to reach users on multiple surfaces.
In short, Facebook ads allow advertisers to connect with relevant audiences and achieve key business objectives ranging from brand awareness to direct sales.
The Facebook Ads Auction Process
So how do Facebook ads actually make their way into your News Feed or other surfaces? It comes down to an automated auction process that happens each time an ad is eligible to be shown.
Whenever a Facebook ad could potentially be displayed to a user, it enters an auction alongside other eligible ads. Bids for each ad are determined based on the advertiser’s budget and optimization goals. Facebook then runs an ad auction to determine which ad to show and ranks them based on:
- Maximum bid – the highest amount an advertiser is willing to pay for their ad
- Estimated action rates – Facebook predicts the likelihood a user will take an action like clicking or converting
- Ad quality – factors like relevance, creatives, landing page experience that impact ad effectiveness
- Delivery – how evenly ads are being shown to intended audiences
The ad with the best combination of these factors wins the auction and gets displayed in the available ad slot. Any ads that don’t win are not shown. This auction process happens billions of times per day across Facebook surfaces as people load pages and scroll through feeds.
Ad Rank
As part of the auction process, Facebook assigns a summarized Ad Rank score to each ad based on its expected performance. The higher the Ad Rank, the better the ad’s position in the auction and chance to be shown and clicked on by users. If an ad consistently loses auctions and has a low Ad Rank, the advertiser may need to improve their targeting, creative, landing page, or increase their bid.
Optimizing Campaigns to Win More Auctions
While Facebook runs the auctions, advertisers can take steps to optimize their campaigns and improve their odds of winning:
- Set an appropriate bid – Using automatic or aggressive bidding can help beat out competitors.
- Target engaged audiences – Focus on audience segments more likely to take action.
- Test different creatives – Try different images, videos, or formats to increase engagement.
- Improve landing page – A relevant, seamless post-click experience boosts conversions.
- Monitor and adjust – Check auction insights and tweak targeting or bids as needed.
With these best practices, advertisers can develop campaigns optimized for the Facebook auction process and earn more impressions and clicks cost effectively.
Facebook Ad Placements
Once an ad wins an auction, where does it actually get shown to users on Facebook? Sponsored ads can appear in various placements:
News Feed
The Facebook News Feed is the primary place users see sponsored posts and ads. On both desktop and mobile, ads appear intermixed with organic posts. News Feed ads may be more prominent on mobile since screen space is limited.
Instagram Feed
Instagram is owned by Facebook and advertisers can run ads in Instagram feeds as well. These ads use the native Instagram formats like photos, videos or carousels.
Stories
Ads also show up between people’s Stories on both Facebook and Instagram. These full screen ads are vertical and brief but eye-catching.
Right Column
On desktop, a column of small sponsored ads runs along the right side of Facebook’s interface. This is a secondary placement compared to News Feed.
Messenger
Advertisers can also place ads within Facebook Messenger, which users frequently have open throughout the day while chatting.
In addition to these placements on Facebook’s own platforms, ads may also appear within the Facebook Audience Network i.e. on third party apps and sites which show Facebook ads.
Ad Labeling
Facebook labels all sponsored ads with small text either above, below or within the ads stating “Sponsored” or “Ad”. This helps users distinguish organic and paid content.
For additional transparency, clicking on the three dots next to an ad will show details including:
- Who the ad is from
- Why you’re seeing the ad
- Ad delivery details
Users can also adjust their Ad Preferences to control the types of ads Facebook shows them.
Negative Feedback on Facebook Ads
While Facebook ads offer obvious benefits to advertisers, some users complain about disruptive or irrelevant ads. Common criticisms include:
- Too many ads interrupting the user experience
- Repetitive ads being shown too frequently
- Ads not matching users’ actual interests
- Linking users’ activity to target them with ads
Facebook has worked to address these concerns by limiting ad frequency, allowing users to hide ads, improving targeting capabilities, and enhancing transparency controls. However, many feel Facebook prioritizes revenue over user experience when it comes to ads.
The Controversy Around Micro-targeting
Facebook ads have also raised ethical questions around micro-targeting specific user segments. While advertisers believe precise targeting is an effective strategy, critics argue Facebook enables the practice of exclusion, discrimination, manipulation, and more.
For example, some fear employers could target job ads exclusively at younger users and exclude older demographics. Or politicians could use combative messaging targeting specific ethnic groups or political affiliations that would be harmful if shown to the general public.
Facebook has updated its policies to ban discrimination and limit micro-targeting for housing, employment and credit ads specifically. However, the debate continues around both the ethics and privacy of Facebook’s ad targeting capabilities.
The Bottom Line
Facebook sponsored ads come from businesses, organizations, and individuals looking to reach specific audiences on Facebook’s platforms. They go through an automated auction process to determine which ads actually get shown to users scrolling through their feeds or visiting Facebook’s sites and apps.
For advertisers, Facebook ads offer unparalleled targeting capabilities and the ability to cost-effectively drive results. But for users, the frequency and relevance of ads remains controversial. Facebook continues working to balance these perspectives and build an ad platform that adds value for all stakeholders.
| Ad Format | Description |
|---|---|
| Photo Ad | Contains a photo and text |
| Video Ad | Contains a video and text |
| Carousel Ad | Contains multiple images/videos users can swipe through |
| Collection Ad | Promotes a catalog of products |
| Lead Ad | Gets users to submit contact information |