Facebook has a number of engagement ads which are displayed on the homepage. The most popular are those which let users click on the “Become a Fan” button directly under and image or video about the product, service, or brand. As of today, polling and event engagement ads include the ability to become a fan immediately after RSVPing for the event or completing the poll. It’s a great way for the advertisers to get ongoing engagement beyond the life span of the ad.

The new ads are fairly straight forward. As soon as the user is completed with their first action, they are prompted to become a fan, as pictured in the image above. Facebook has been experiencing a lot of success in selling large brand ad campaigns which convert users into fans. As I’ve written in the past, there has become an underground ecosystem of ad networks which provide advertisers with ads on a “cost per fan” basis.

Facebook however sells all homepage advertisements on a flat CPM basis. Brands continue to purchase ads though as campaigns are converted into communities where company’s can continue to engage the users. While you can only purchase these types of ads directly from Facebook, if you’re working for a larger company, these new engagement ads are something that you may want to look into.

It was only a matter of time before another company decided to publicly announce the launch of a service which sells Facebook Page fans for next to nothing. That’s exactly what Viralee is doing this evening. We’ve been receiving inquiries from numerous companies which sell fans under the table, but none have been willing to make a public announcement.

The real issue here is that many services may technically violate Facebook terms. Even if they don’t, it’s direct competition to Facebook in one regard which is why this is shaky ground to operate a business on. In the past week alone, Viralee claims that they’ve sold over 1 million fans. That means serious cash is being spent on fans and according to the underground companies we’ve spoken to, brands are flocking to the “pay per fan” model which we’ve written about numerous times.

So how long does it take for Viralee to turnaround fan orders? The company’s founder, Dominic Holland, has provided us with the following numbers:

For 1-100 fans – same day
For 1,000 fans – inside of 5 days
For 10,000 fans – inside of 14 days

And one plan for the corporate guys is 1,000,000 fans which we guarantee within a month

The only other public competitor that we know of currently, USocial, has already received a Cease And Desist letter after reportedly spamming users and gaining unauthorized access to user accounts. Dominic Holland, founder of Viralee, tells us that “We do not take control of any users account at any time. We create a page for the user and market it within and externally to facebook.”

It’s unknown whether or not Facebook will try to crack down on pay per fan services as most fans will be untargeted. Facebook in contrast provides homepage engagement ads which can drive a large number of targeted fans. As I wrote yesterday morning, Verizon was able to attract over 100,000 fans in a day from a single homepage advertisement.

While engagement ads are sold on a CPM basis, we’re hearing that the effective cost per fan for homepage engagement ads is anywhere between $5 and $10. Facebook appears to be experiencing growth in brand ad spend though which is why they may allow untargeted marketing services to peacefully coexist. Oh and if you were wondering who Dominic Holland is, he’s the guy that Orabrush acquired the “Kisses” page from in a bidding war with Hershey.

If you had any question as to those Facebook ad networks that developers can run on their applications, question no longer. Yesterday evening Facebook posted an update with those ad networks which are safe to run and those that aren’t, in turn singling out four ad networks: Gambit, Social Hour, SocialReach, and Tatto Media. We’ve written extensively about most of these networks, however the latest added to the group is Gambit, something we had been hearing for the past couple weeks.

Facebook now has created two wiki pages in the Facebook Developer Wiki: those companies who can help you monetize your application and those who are not permitted to. It’s a statement to ad networks: cross the line and Facebook will shut you down. Whether or not the company can monitor all the advertising running across their platform is one question, however if your company wants to play cat and mouse with the company, you’ll risk getting shut down.

What is the line that’s being drawn? Well, developers will need to follow the the newly revised platform policy. While Google’s policy is simply to “do no evil”, Facebook’s policy for developers is to “be trustworthy” and to “create a great user experience”. In the world of online advertising, I would argue that where the ethical line is drawn isn’t really that ambiguous, however a number of ad networks have continued to push the limits.

That’s why Facebook is now drawing a definitive line for those ad networks. If you continue pushing the limits and Facebook continues to find your ads in violation of the company’s terms, you risk being placed on the “Banned” lists. With an enforcement team which is increasing in size, trying to push deceptive ads through Facebook Platform applications is becoming an increasingly risky business.

On any given day we receive 5 to 50 stories to post on AllFacebook, however there’s no way for us to currently cover everything that goes on. Determining which stories to publish is part art and part science, however that doesn’t mean you shouldn’t be aware of all the things going on related to Facebook. That’s why we’ve decided to post occasional updates on the stories that we couldn’t get to the day before. Today we have 3 stories from yesterday that you should be aware of.

Initial Class Action Complaint Filed Against Facebook and Zynga

Last week we wrote about an impending class action suit which named a number of companies on the social web including Facebook, Zynga, and a number of offer networks. At the time we reached out to the law firm responsible for the class action to find out more details. They told us that they were currently seeking individuals who had been deceived in order to name them in the suit. One week later it appears as though they’ve found that individual: Rebecca Swift.

On behalf of Swift and other victims, Kershaw, Cutter & Ratinoff, LLP has filed an initial class action complaint against Zynga and Facebook. No other networks appear to be named in this initial complaint, however there could be additional complaints filed in the near future. The turnaround time on this has been extremely quick. You can view the full complaint via Valleywag.

Facebook’s Common Stock Valuation Jumps

In what appears to be an effective press release for SecondMarket, Bloomberg published an article stating that Facebook’s valuation has jumped in private markets over the past few months. While many of us love to speculate about the future of Facebook and what their valuation will be, private markets are also extremely tricky for setting exact valuations. Then again, if someone is willing to pay a specific price, that price determines the value of the company at the time of the transaction.

In illiquid markets however it’s difficult to track bid and ask rates on shares since the information is not complete.

Adknowledge Acquires SocialMedia’s Ad Network

SocialMedia which was previously one of the leading Facebook platform ad networks, sold their ad network to Adknowledge for an undisclosed amount. This is part of a continued roll-up of ad networks which the company began back in 2008. The company currently own Cubics, Adonomics, Lookery’s ad network, SuperRewards, and now SocialMedia’s ad network. Adknowledge has been focused on the performance advertising space, an area which has come under increasing scrutiny amidst new class actions like the one we covered earlier in this post.

Adknowledge has been aggressive in building a large social advertising roll-up, this acquisition being the latest in an ongoing series of acquisitions.

Back in July we first wrote about the impending launch of the Facebook Ads API and today marks the launch of the first ad manager built on top of the Facebook Ads API. Alchemy, which has received just under $500,000 worth of initial funding from the TechLightnment team, is a proprietary tool for planning and buying social advertising. The initial campaigns have seen anywhere from 500 to 1,000 percent increases in click-through-rates according to the company.

TechLightenment is not exactly new to the social marketing scene. The company launched soon after the Facebook platform launched, developing custom applications for brands including the Bob Dylan application which garnered a lot of attention. The new Alchemy tool enables advertisers to create hundreds of ads for individual campaigns to run tests to determine the effectiveness of various images and copy combinations.

While I’d expect other companies to launch their own Facebook ad managers, this is the first one we’ve heard about. The company has told us that they are looking to accomplish performance at scale, which means running hundreds of ads to dramatically increase campaign performance. Want to get started with Alchemy? You’ll need an initial media spend of at least $16,000 to start working with TechLightenment.

I’d assume that we’ll see similar requirements as other third-party ad managers launch over the coming months. Scaling Facebook ad campaigns require a lot of testing and a significant budget, however investing in larger campaigns can produce better results. We’ve heard that many large affiliates are investing tens of thousands of dollars a day on Facebook Ads, making it necessary to have more robust ad manager tools.

Alchemy has already been used by companies like Samsung, GlaxoSmithKline, and Nissan. While I’m sure a number of other agencies will begin offering similar services, this is the most robust implementation of the Facebook Ads API that we’ve heard about to date. If you are looking for a robust Facebook Ads manager service, you can check out the Alchemy website for more information.