Business Insider 12/17/12
How Facebook Gave Walmart A Mobile Ad Monopoly On Thanksgiving
If you were wondering why you only saw ads for Walmart on Facebook's mobile app over the Black Friday weekend, here's the answer: Walmart pre-purchased a "road block" of 50 million Facebook mobile ads on the day after Thanksgiving, forcing other advertisers off the network, according to the Wall Street Journal. Wal-Mart said it bought two billion ads on Facebook this holiday season, three times more than last year, but declined to say what it spent.
A "road block" is the ad industry term for when an advertiser purchases all available inventory so that none is available for competitors. They tend to be incredibly expensive.
Normally, Facebook ads are served on a bidding system. Anyone who wants to pay the highest bid will get their ads served. But that didn't happen at Thanksgiving, the WSJ says:
Wal-Mart prepurchased the ads and edged out other retailers for space during the all-important kickoff to the holiday shopping season.
Facebook now is considering making the option available to other companies.
The reaction was massive:
Wal-Mart said it bought two billion ads on Facebook this holiday season, three times more than last year, but declined to say what it spent.