facebook-logo.JPGFacebook is upping its range of advertising possibilities. The popular social media site is testing Sponsored Results, which are ads that show up in the Facebook search area.

This kind of advertising allows a company to potentially direct competitors’ traffic to its offerings. For instance, if a user, looking for the Facebook page of Justin Bieber, typed his name into the search box, a competing celebrity’s Sponsored Results ad could display in the typeahead area that makes suggestions. The ads do not appear on the full search results page.

Not Targeted at Keywords

The tested Sponsored Results resemble organic search results, except for a brief sponsor message and a very small label that they are “sponsored.” Advertisers will pay on a cost-per-click basis.

These ads cannot be targeted to general keywords, like “celebrity,” but have to be directed at specific pages, apps or places on Facebook. In addition to the targeted entity, the ad can also draw on social graph information about the user, so that it’s shown only to users of a certain age, in a certain location, and with certain likes. The ads will only link users to locations on Facebook, although those locations could be an app, a coupon or a post.

The new Sponsored Results could be more appealing to Facebook advertisers than the current sidebar ads, which can more easily be ignored and are not necessarily related to the specific activity in which the user is engaged at the time.

‘Lurched’ Between Ad Models

A key question is to what extent the Sponsored Results could affect the perception of organic results. Google’s Sponsored Results, which are somewhat more visibly shown as being different than organic results, appear before those results and have sometimes been accused of confusing the user.

It’s also not clear to what extent users actually employ the search feature, since Facebook has not offered statistics. The company recently added “search for people, places and things” to its search bar, which some observers had taken as a sign that it was preparing for search-related ads.

The social networking giant has also not settled on the best ways to capitalize on its huge membership base and corresponding demographic data. As Forrester’s Nate Elliott wrote on his interactive marketing blog in May, in the past five years the company “has lurched from one advertising model to another.”