Facebook runs ads from its own advertising system that lets your friends know if you have a direct connection with a product or service. This works similarly to the way your friends learn if you're connected with a Facebook Page through News Feed. For example, if one of your friends likes a Page, you may see an ad with your friend's profile photo next to it, indicating the action that friend has taken with that Page.

Unlike ads, Sponsored Stories are stories that your friends published into your News Feed. These show up on the right hand side of pages on Facebook. The types of stories that can be surfaced include: Page Likes, App interactions, Place check-ins and Page posts.

Both Facebook Ads and Sponsored Stories always require that you and your friends have taken an express action to indicate your connection with the product or service; furthermore, your personally identifiable information is not shared with advertisers.