SMX Live Blog: Grady Burnett, Facebook Marketing VP Keynote

Day two of our SMX West 2013 conference is about to get underway, and we’re starting with a keynote conversation between Marketing Land’s Founding Editor, Danny Sullivan, and Grady Burnett, Vice President of Global Marketing Solutions for Facebook. Conversation is expected to include things like Facebook Exchange, Graph Search, the new News Feed experience and other topics that of interest to brands and marketers.

We’ll be liveblogging in this space, so feel free to follow along, refresh the page every now and then and enjoy our coverage of today’s SMX West keynote.

Back soon!

(We’re actually beginning with the announcement of the winner of our Biggest Search Geek contest, done in conjunction with Marin Software, and that winner is Renata del Vento! Congrats!)

And now, we’re off as Danny introduces Grady Burnett. Here we go…

Danny mentions that FB ads used to just be on the side, but now there’s almost a landslide of sponsored content in the News Feed. Asks Grady to give an overview of Facebook ads right now.

Grady: We think of there being four types of advertisers — brand advertisers, direct advertisers, local advertisers and a fourth one that I didn’t hear because someone’s phone near me just went off with the strangest ringtone ever.

We’ve tried to simplify for the local business owner. Fifteen million have Pages on Facebook now, and eight million manage them via the Page Manager app. (Note: not all 15 million Pages are local business Pages. That number includes ALL kinds of Pages.)

Grady mentions a success story with ShoeBuy using Facebook Exchange and increasing conversions.

Danny asks if new ad formats are coming in 2013.

GB: We’re always looking to improve the types of ads we run. We recently launched Link Posts to simplify the process of sharing brand links.

DS: Tell us about the acquisition of Atlas from Microsoft.

GB: We’re excited about that. We’ll be able to work better with advertisers that want to know how their ads are performing across various campaigns. Advertisers have focused on last-click attribution, but we’ve seen that there’s a lot more going on. Atlas can help us tell that story. It will help us offer better measurement and better understanding, which means better optimization.

DS: When do we get “Facebook Sense” — i.e., a version of Google AdSense using Facebook ads.

GB: There’s so much to do on our own site. The average user is engaged 50 percent more on our own site, so we’ve been zeroed in on increasing the value for our advertisers on Facebook. But it could certainly be valuable to extend that to other sites. We did a short test last year that was very successful, and we could do it again in the future.

DS: Asks about local and mobile businesses using Facebook ads.

GB: Again mentions that same 15 million Pages number, and again (incorrectly) states that it’s 15 million business Pages — but it actually includes other categories (Community, etc.). Tells a story about finding a local business via Facebook recently.

DS: Again asks about mobile.

GB: About a year and a half ago, we realized that we weren’t as deeply invested in mobile as we should be. Mark Zuckerberg made that announcement where he said, “we are a mobile-first company.”

(missed some of this discussion)

GB: Our goal with ads is that they should be as great and relevant as the regular post that you just read. We started using ads with context — i.e., your friends like this. Then we added Sponsored Stories, and that transition made advertising far more relevant for most users. That’s where we started growing our mobile ads — via Sponsored Stories in the News Feed on mobile.

DS: Asks how many have the new News Feed — very few raise hands.

GB: Reception has been great so far, but it’s only out to a very small percentage of users. It takes a lot of the mobile principles we have — larger images, less clutter — that means higher engagement. It’s a visual redesign. The mobile-first mindset has made us think how to use the screen more effectively.

DS: Does that mean you can deliver more ads?

GB: That shouldn’t change. We’ll still show the same amount of ads, but it should mean more engagement. The bigger canvas, bigger images has been good for advertisers in our tests.

DS: Mentions the Nick Bilton article about posts thinking they have to pay now to get fans to see their posts.

GB: Our News Feed algorithm continually looks at relevance — what are the most likely things that each user will want to see. We’re constantly changing the algorithm, but there’s no effort to force people to buy ads so their posts can be seen.

DS: Mentions that our Facebook stats (for Marketing Land and Search Engine Land) saw a drop in September, but have rebounded to where they were before. Would Facebook ever start announcing updates to changes in the News Feed algorithm, like Google does with things like Panda and other updates.

GB: We can certainly do a better job of communicating and offering clarity on things.

DS: Asks about Graph Search – how’s it going?

GB: It’s been rolled out to a very small percentage of users. The early results are great. Always been a lot of search on Facebook targeted at people, photos and places — in that order. We thought we could improve that by looking at natural language queries. I want to see a restaurant in New York that my friends have been to, or I want to see photos that my friends have posted.

From a marketing perspective — there’s not advertising built in to Graph Search at this stage — but think about the Page. The information on it should be up to date and accurate, and then engagement helps gain visibility.

(missed Danny’s next question)

There’s so much going on the whole ecosystem — there’s a tremendous opportunity for us to help users discovers new companies, new Pages. That’s what we’re focused on at this point.

DS: Do you ever see Facebook wanting a dedicated search product outside of Facebook? Mentions the past rumors that Facebook might buy Bing from MSFT.

GB: I don’t see that happening. We called it “Graph Search” because we’re focused on letting people search the Facebook graph. So my answer would be no.

DS: What are your thoughts on what Google is doing with social? Big threat? Interesting diversion?

GB: I don’t spend a lot of time thinking about it. But the world is a social place — every business should have a social element. So Google taking steps in that direction is a positive thing. I’ve not used their products enough to have a sense of how they’re doing.

DS: Does Facebook do well if more people are “social” online?

GB: We don’t need to be the place where everything social on the Web happens. We’re building things that help people be social on other sites — like Open Graph buttons.

DS: Asks about privacy issues, especially in relation to personal data.

GB: We’ve been very transparent in explaining to our users that we do use their information to help them see more relevant ads. And we also give them control — down to each post, letting them control who sees it.

DS: On some services, you can pay to opt out of ads. Do you see Facebook ever offering that?

GB: I don’t see us doing that. We think we have a terrific ability to deliver relevant advertising that’s just as relevant to you as your friends’ posts.

DS: How do you make money off of Instagram?

GB: Kevin and the team have done a great job in bringing the company over, but they really run independently. They’re on such a great trajectory. They’ve always had plans to advertise there, but it’s a question of when. The focus is on users first. It really is operated independently, but we’ll integrate where it makes over time. But we’re nowhere near the stage of placing ads.

Now time for audience Q&A!

Q: Will Graph Search eventually replace Bing?

GB: Graph Search will replace existing Facebook search. Suggests staying tuned for next session about Graph Search where a Facebook speaker will discuss it more.

Q: If focus is on SMBs, how come ad products are always tested with big brands?

GB: I was talking about Promoted Posts specifically — which were designed for small business Page owners. That was done through focus groups of small businesses. Other ad products are done for and with larger marketers and brands, like Link Posts. And we also work with huge data companies to do studies on other campaigns.

Q: Asks about ad load.

GB: We track that closely. We haven’t seen drop-off in engagement as ads have increased.

Danny ends with a game of word association and, when he says “Twitter,” Grady pauses before saying “Don’t use it.” Then he quickly clarifies that he’s saying that it seems like a great product, but he doesn’t even have an account and his “don’t use it” response was not prescriptive advice for the audience, but a personal explanation. Much laughter ensues.

And with that we’re done! Thanks to all who read along.