According to digital marketing technology firm, Kenshoo, Facebook Inc. (NASDAQ: FB) is making significant progress in improving its mobile advertising business.
Kenshoo said that, at present, 20% of the entire revenue FB generated came from mobile ads spends. This is a big improvement from October, when Facebook reported only 14 % of ad revenue was generated from mobile.
Facebook, whose user base and revenue per user started to decline in 2012 due to lack of visibility in mobile, started to put concerted efforts on mobile computing in order to increase its revenue through mobile- advertising since last March.
While initially investors doubted on whether the new revenue model would work well for the company, some recent studies, according to TechCrunh point out that mobile ads are working well for Facebook and the shift will help in boosting revenue as more and more users are switching to smartphones over desktops.
Another major advantage of mobile ads over desktop ads is the user attention that former generates. For instance, Facebook shows seven or more ads per page on desktop, which in turn lowers the probability that a user will hit/click a particular ad since he/she is looking at multiple ads a time. On the other hand, a single ad fills most of the mobile screen, which is likely to attract more eyeballs. This is the reason why, Facebook is charging 70 percent premium on mobile ads over desktop ads, according to Kenshoo.
“The world’s top brands have embraced Facebook mobile advertising, and we expect the channel to become increasingly competitive as new devices, like those on display at the Consumer Electronics Show this week, deliver enhanced interactive experiences,” said Kenshoo’s CMO Aaron Goldman in a market research note, adding that more advertisers will prefer Facebook’s mobile placements which in turn push the mobile ad spend from current 20.3% to become even bigger part of Facebook’s ad pie.
Nevertheless, the social networking giant will need to put in more efforts if it has to gain traction in mobile business, especially on Google’s Android operating system. According to TechCruch, 71% of the ad spends that were targeted on smartphones, went to Google’s Android.
Recent Comments