IPG has committed $10 million in advertising to Facebook, Melanie Deitch, director of marketing for Facebook, told CNET News.com. IPG has also agreed to acquire less than one-half of 1 percent of Facebook. In exchange, IPG said, it will participate in market research, polls, surveys, promotions and "pilot programs involving sponsorships" on the social networking site.
"represent a difficult-to-reach, but very key, audience for many of our clients. Young and tech-savvy consumers are increasingly shunning traditional media vehicles and defining themselves and their community online," Interpublic CEO Michael Roth said in a statement. "Facebook is among the top 10 most-trafficked sites in the United States."
IPG will plug companies into Facebook's already-established levels of advertising, said Deitch. Facebook offers typical banner ads and local advertising, as well as what are known as Facebook Sponsors, who interact with Facebook members on a seemingly casual level through something called Sponsored Groups. For example, the Microsoft Student Group offers free software promos, news on college campus events, and videos from Microsoft employees. It also welcomes feedback.
"But this isn't a one-way deal. If you've got comments or questions, POST THEM! We'll answer--promise! :) ," says the Microsoft Student Group page on Facebook.
It's a heterodox advertising method that may be new to many of IPG's clients. Many people still debate. Others are betting on them. In April, Facebook, a competitor of , received $25 million in second-round funding.
"The piece that's really unique with IPG is that we both have strong strategic focus on consumer insight. The 19-to-24-year-old demo is really hard to reach, and the consumer insight is a focus on really trying to understand that demo much better," Deitch said.
Facebook may already be reaching that evasive demographic. In June, showed that 71 percent of college students considered Facebook an "in" thing on college campuses, compared with 58 percent for MySpace. Facebook tied for second place with beer, while iPods were first.
But college students won't find any beer ads on Facebook.
"No gambling, firearms, tobacco, alcohol, no pornography--we don't accept any advertisers in any of those. We are constantly asked by poker sites, just because it's so popular right now, but we just don't do it," Deitch said.