Facebook's Big Push to Put Advertising in Your Feed

The news feed is about to more cluttered and lot more profitable for Facebook

Facebook plans to change its news feed from a curated stream of information to unfiltered mayhem, reports The Wall Street Journal's Shayndi Raice and Emily Steele. Currently an algorithm decides what you see in your feed--generally the feed shows the activity of your friends with whom you interact most. And while users might like that the system hides "Friends" who aren't friends, advertisers don't appreciate the veil--they want those valuable eyeballs. Facebookers will likely resist the changes--as they do when Facebook makes any design tweaks--but this time Facebook admittedly doesn't care about the people. It's now an advertising-first company.

Advertisers have recognized the value of 750 million users, but Facebook has resisted splattering the site with tacky banner ads; as Justin Timberlake (as Sean Parker) noted in The Social Network, "You don't want to ruin [Facebook] with ads, because ads aren't cool." But now the social network's not worrying as much about being cool and would like to cash in. Advertisers can try to get their message in front of that huge user base with the "Like" button and on brand pages. But the feed's ability to hide certain (annoying) information has limited the reach that advertisers seek, explain Raice and Steele.

While advertisers have created online campaigns with the intention that consumers would share their messages in the News Feed, Facebook's algorithms don't display every piece of content that is shared, limiting the impact of the campaigns, said Ian Schafer, chief executive of New York-based digital marketing firm Deep Focus. "It's wasted potential," he said.

Facebook's move to unfilter the news feed would make these advertisers much happier. The newer feed "would open the floodgates of information about users and the games they win, the companies they "Like" and the actions their friends take, said people familiar with the matter," continues Raice and Steele.

Not only would Facebookers have to stomach more direct advertising, but the move would also provide Facebook with more information about its users, another valuable metric for advertisers. "The more they let you do through Facebook, the more Facebook knows about those particular actions and those particular people," Shafer told the Raice and Steele.

And Facebook's already working on giving those money-making metrics to advertisers. They have teamed up with Nielson and created the Online Campaign Rating System, which provides companies with demographic information for their campaigns on any site (not just on Facebook!), reports Fast Company's E.B. Boyd.

Here’s how it works: Advertisers tag their ads and then place them on their targeted sites around the web. When the ads are viewed, the ads make a call to Facebook, which then searches its own user database to identify the viewer of the ad. It then gathers up that person’s demographic information (but not personally identifiable information) and sends it to Nielsen. Nielsen is then able to report back to advertisers who saw their ads in a particular campaign.

While there may be some user backlash--an unfiltered feed provides a very cluttered experience--the new feed could also create some privacy issues, CNET's Stevn Musil notes. "This move will likely increase the data going to advertisers and developers based on your selections; something privacy groups have yet to stomach."