When you login to your Facebook account you usually see a few ads on the right hand side. You can click on these ads, “Like” them or make them disappear if you are not interested in them.
Facebook ads can be set up as pay per click ads or pay per impression ads, but they are different from most PPC ads as they incorporate a picture. When you setup an ad in Facebook, you can choose the demographics of the people that you want to show the ad to. This is big, as you can narrow down your target audience based on their age, sex, where they live, what their interests are and much more. This means that these ads are many times more targeted than Google Adwords and Yahoo Ads can ever be.
The image you use in your ad is very important and you should be sure to choose something extremely eye catching, but obviously related to your ad. If you choose the pay per click method the price you pay for your ad will vary based on how successful your ad is – the higher the CTR (click through rate), the lower your cost per click.