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FBX, or: How I Learned to Stop Worrying and Love RTB

Written by: Juliana Casale, Director of Marketing

According to a new study released by the Association of National Advertisers, many client-side marketers are unaware of what programmatic buying is or how it can be applied to campaigns. This lack of awareness is surprising given the clear advantage provided by real-time bidding; namely, the chance to serve up a high volume of ads using up-to-the-moment targeting to reach customers who have expressed a strong interest in similar products and services. Since Facebook unrolled real-time bidding platform Facebook Exchange (FBX), the first of its kind, in June 2012, the social media giant has grown to over 1 billion users; a huge opportunity for marketers looking to grow their advertising at scale. With Facebook now accounting for nearly half of the retargeted clicks on the web, you can’t afford to ignore this channel — but we can understand how it might sound intimidating.

Let’s start with the basics:

What is FBX?

Just like the stock market, Facebook Exchange allows real-time bidding (one type of programmatic buying; there’s also the Google Display Network and the Facebook Ads API) on inventory – in this case, for the purpose of remarketing in order to garner impressions and clicks on ads. It only applies to Facebook’s standard ad inventory, and can only be accessed through a Demand Side Platform (DSP) partner.

What does FBX look like for brands?

Say you’re an eCommerce company and you want to make sure that visitors who shop on your site complete their shoe purchases. You set your website up so that every time someone visits it, a pixel gets saved in their browser. Your DSP collects this data, sending it over to Facebook. If your site visitor logs on to Facebook, your DSP will bid against other brands on FBX to get your shoe ad served up to that particular individual in their News Feed (if you’re advertising through your brand’s Facebook Page; news is only pulled from content posted within the site) or the right hand rail. You will only be charged for ads that are served or clicked, based on what metric you select. From start to finish, this process is lightning fast; it only takes seconds. This means DSPs process a LOT of data per hour.

What does FBX look like for consumers?

Say you’re browsing a site for shoes and add a pair of heels to your shopping cart. After a few minutes you get distracted by your pet cat and switch tabs to log on to Facebook. Suddenly you see a high heels ad from the site you were just browsing – which happens to be a company your friend Amy has previously liked – in your News Feed. You remember you forgot to purchase the heels, so you return to your shopping cart and buy them. You’re so pleased with your purchase that you share the ad to your Wall with the comment, “Just bought these to go with my little black dress!”

How customizable is FBX?

Here are the options for tailoring your campaigns:

  • Add creative copy (typically 90 characters or less) and an image (typically 1200 x 627 pixels)
  • Set daily or lifetime budget spend, based on whether you have a set range of dates you’d like to run your ads
  • Target by country, region, state, city, or zip code

What are the advantages of FBX over traditional or native advertising formats?

  • Facebook Exchange uses real-time bidding (RTB), but API does not (it buys inventory by audience)
  • Advertisers can use their first party pixel data for remarketing purposes on FBX, but they can’t target this data through the API
  • FBX allows for dynamic retargeting – serving an ad to a user that matches the last product they viewed on a company’s website

This last bullet may be the most important. Since RTB is an actual auction, companies only want to pay top dollar for consumers who show strong intent. If you can retarget someone based on their buying behavior, odds on making the sale are in your favor.

Interested in learning more about Facebook Exchange? Check out these additional resources:


•  10 Steps to Boosting FBX Conversions
•  Driving FBX Results with Dynamic Creative

Case Studies

•  Dynamic Creative Increases ROI of FBX by 5X
•  News Feed Increases ROI of FBX by 197%

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