Facebook Mobile Product AdsSocial networking giant Facebook is hoping to attract more digital advertisers with its latest ad unit, ‘Product Ads,’ that’s been designed to help retailers target their ads more effectively to its estimated 1.39 billion monthly users. Product Ads will allow users to upload their entire catalog of products onto the site and target different users with specific products. The products will be selected based on the user's profile, interests and browsing behavior.

The move reflects Facebook's desire to prove that its estimated 1.39 billion members are good for more than just "likes", as it enters into the lucrative product-listing ad market, currently dominated by Google Shopping Ads.

So, what is Facebook proposing with Product Ads and how does it work?

facebook product ads

Product ads offer businesses a number of ways to highlight their different product ranges on Facebook.

Advertisers can either upload their product database and create targeted campaigns themselves, or let Facebook automatically deliver the most relevant products to people.

Product Ads can display either a single product, or a set of three, each with its own image, description, click target and statistics, as per the below ad from Image Publishing Service, Shutterfly, who along with Target, are the first retailers to test the new ad format.

shuffterfly facebook product ads

Product ads can be customized according to each customer’s journey. For example, advertisers can automatically reach people who visited their website, app, or based on their specific preferences, interests, location, etc, and curate ads as they see fit. Some retailers may choose to highlight just new products, or showcase their best selling products, or they can create a multi-product ad that highlights the different benefits of a single product.

Product ads also utilize features that help create a better ad experience. For example, when an advertiser uses the ‘automatic delivery function, Facebook will turn off the ads for certain products when they’re out of stock, or discontinued for example.

Ad Targeting Domination

Facebook is king of ad targeting, thanks to their Atlas acquisition and their offline purchase data partnerships. Now, with the addition of Product Ads, advertisers can target an endless number of pre-qualified consumers on the world’s most popular social networking platform.

Giving all of these insights more commercial relevance with is super smart on Facebook’s part and should make their ads a lot more valuable to brands.

In another clever move, the company has also been experimenting with "buy buttons" to encourage spur-of-the-moment, in-stream purchases with a single click.

Topics: Facebook Advertising, Facebook Ads, Social Media Advertising, Facebook, Facebook Product Ads

Tim Nichols

Written by Tim Nichols

Tim Nichols is a founding partner at ExactDrive, a digital media buying agency with white label, reseller and managed service options available. ExactDrive plans, manages, and optimizes online advertising campaigns with the objective of delivering measurable value and empowering clients to find precisely targeted audiences. ExactDrive has offices in Minneapolis, MN and Milwaukee, WI.

Tim Nichols is also a contributing author on Forbes.com.