1. Facebook: Opportunities for Brand Advertisers Daniel Slotwiner Head of Measurement Solutions

2. 1Facebook research supports brand advertising objectives 2Capturing Value (measurement) 3The power of fans… and their friends

3. Research & Measurement Objectives Re-establish Brand Metrics as the primary outcome measures of interest Use Brand Metrics to evaluate new ad and platform products Demonstrate Facebook’s role in influencing Brand Metrics Drive development, standardization and adoption of methodologies that capture brand value

6. More than 30 billion pieces of content (photo albums, web links, news stories, etc.) shared each month

7. Real demographics

8. On the site almost 6 hours per month

9. 2x next closest site

11. 55% of US users return daily Source: Facebook Internal Data for the US, May 2011

12. Nielsen Study Released on Monday

13. Driving consumers towards four brand advertising goals Grow product market potential 1 Drive brand resonance Increase short term sales 2 4 Consideration Recall Brand / Product awareness Purchase intent Purchase(frequency, sales) Message awareness & association Promote long-term brand equity 3 Associations Loyalty Advocacy Neither resonance nor equity measured in traditional MMM framework

14. Background Nielsen NetEffect meta analysis: “There is no correlation between CTR and ROI%”

15. Data collection via research polls Increased participation 100x higher response rates than CTRon ads recruiting for offsite surveys More timely, representative samples 1000 respondents with nationallyrepresentative demographics in 15minutes

17. Very strong agreement with Rasmussen (r = 0.91) and Gallup (r = 0.90)

18. Higher agreement with both than between Gallup and Rasmussen (r = 0.84)Facebook margin of error +/- 2% or smaller | Gallup margin of error +/- 3% | Rasmussen margin of error +/- 4% External validity: Political opinions

20. NYT/Gallup: +11% approval

22. Ad effectiveness ROI proxy: Establishing correlation Facebook users asked a week before release:“Are you planning to see [film] in theaters? R = .90 Intent question: Are you planning to see [movie] in theatres? Top 2 box of 5-point scale summarized; All samples 13+ and N>500 Question asked 11:00 am PT, 7 days prior to premiere (generally Friday)

23. Advertising on Facebook moves metrics +13% +3% +1% Source: Nielsen 5/12/11, n=399

25. β1xi1+…+βpxipwhere:

26. β1 = purchase intent

27. β2 = ln(purchase intent)

28. β3 = number theatres

29. +1% in purchase intent 1 week prior to opening ~$4M (+/- ~$1M) in additional opening weekend revenue

30. Estimated advertising cost to move intent 1%:  $600K

31. ROI for opening weekend alone  ~700%700% ROI

32. Developing cross-platform measurement Standard measurement Reach Resonance Reaction

33. Value of Nielsen OCR Audience True reach Comparability Understand the demographics of who you are actually reaching online, in a consistent way across multiple publishers identification & frequency Measure online reach and frequency in a consistent way, across publishers and for your entire online media campaign OCR reports include campaign, demographic segment, and placement-level GRP calculations that are comparable to other media, including TV

35. High response rates, 10-100x of other methods, ensure representative sample & not “professional survey takers”Polls next day in ad context

36. Social context boosts effectiveness Ad effectiveness 1.6X lift in brand recall 2X lift in message awareness 4X lift in purchase intent Source: Nielsen

37. comScore whitepaper The right metrics for measuring earned media are reach and frequency, not just raw counts Friends of fans are the biggest opportunity for marketers on Facebook and are largely untapped – 34x the size of the fan base Fans are primarily consuming content from pages in the Newsfeed, not by visiting the page itself; brands should be optimizing for this context

38. Facebook population Friends of fans My friend likes this brand 60M friends Fan base 500K fans Ads with friends US Facebook data Fans are more valuable when they impact their friends

39. Facebook population Friends of fans 527M friends Starbucks Fan base 19M fans This is word of mouth at unprecedented scale Global data

40. Significant opportunity with Friends Sales 8% higher spend11% more transactions Brand Engagement 27% more searches by friends of fans Web Traffic 2.6x more site visits by friends of fans Source: The Power of the Like, comScore and Facebook, July 2011 * Numbers compared to average internet user

41. Ad effectiveness Reach + Impact  Value & ROI PUSH PULL Sponsored Stories & Social Ads Reach (Illustrative) Passively from Friends Direct from Friends Friend-endorsed Brand Messages Opt-in from Brands Generic Brand Messages Communication Types Endorsed Brand Messages

42. Thank You. Daniel Slotwiner slotwiner@fb.com