At LP, we kinda like Facebook ads. First of all, they’re more relevant than just about any other ads in the universe besides Google ads. That’s because they target users based on their profile information.

Further, by liking and unliking them, you can tailor them to your tastes — and weed out those borderline offensive beauty ads that pop up in your stream like digital cockroaches.

The bean counters at Nielsen have just published a study that gives insight into the value of using Facebook to advertise, both through paying for ads and through “earned media,” where users organically pass the marketing message along to their friends.

Working with Facebook’s in-house researchers, Nielsen surveyed over 800,000 Facebook users and 125 individual campaigns from 70 brand advertisers. The full report, “Advertising Effectiveness: Understanding the Value of Social Media Advertising” is downloadable here (in exchange for a smattering of your marketing information).

The survey looked at three kinds of ads along a continuum of inorganic to organic: (1) The plain homepage ad that you pay for; (2) the homepage ads with “social context,” meaning friends of yours who have become a fan of the brand; and (3) “earned media” social stories, which are the notifications of friend activity that appear in a user’s timeline.

Nielsen found that in terms of customer ad recall, brand awareness and purchase intent, Facebook ads that contained social context ruled over ads that didn’t.

That’s not really surprising, is it? The message here is that we trust our friends’ recommendations way more than we trust an image on a screen, however targeted that image may be.

In fact, as I’ve been writing this, I’ve been polling my Facebook friends about what kind of coffee maker I should buy to replace my leaky old Mr. Coffee.

Your move, Cuisinart.

Everybody likes free.  At least, that is, until free fails.  Recent promotions by a fast food franchise and by a popular candy company left a bad taste in the mouths of tens of the thousands of disappointed customers.    It doesn’t have to end badly.  Businesses need to fully anticipate the consequences of their marketing efforts.  A massive campaign with national awareness isn’t necessarily better than a smaller, precisely targeted approach.