Архив метки: Sponsored Story

Facebook Helps Third-Party Mobile Apps Grow Today…So It Can Monetize Their Content With Ads Tomorrow

Facebook Mobile Money

The fundamental misunderstanding of Facebook’s mobile prospects is that it’s trying to compete with iOS and Android for in-app payment revenue via HTML5. It’s not. What Facebook really wants is the content produced by apps on every platform, which it can monetize with ads. Payments revenue is a very nice bonus, but not critical. That’s why Facebook announced today that it’s making money on mobile for everyone else by pouring traffic into their apps.

Facebook says it drove 160 million visitors and 1.1 billion visits to third-party apps last month, up from 60 million visitors and 320 million visits in February. And now seven of the top 10 grossing iOS apps and six of the top Android apps integrate it to power discovery and virality. By showing that it can drive traffic to mobile apps, devs will keep integrating Facebook and sending it news feed stories that the social network show ads next to.

Facebook has powered many of the big recent mobile success stories. The Flixster movie review and info mobile web app saw Facebook referral traffic soar to 480,000 hits a day, up 10x in the last four weeks. BranchOut released its Facebook-integrated professional networking mobile app 12 weeks ago, and has since seen its traffic boost from one million monthly active users to 12.5 million MAU. Apps like Viddy (now at 16 million registered users) and SocialCam have jetted to the top of the free charts thanks to traffic from their Facebook Timeline integrations.

Viddy’s a perfect example for understanding Facebook’s mobile strategy. Facebook is promoting the app here even though it’s a native mobile app where the social network can’t make any money taxing in-app purchases. But that’s fine because instead, Viddy is sending tons of highly engaging video content to the Facebook news feeds and Timelines. When users spend time on Facebook to watch Viddy videos, Facebook makes money on ads.

And even as its user base shifts towards mobile, Facebook will still make money on ads. Sponsored Stories on mobile work. I know because I don’t mind seeing them, opposed to the obtrusive banner ads and instantly-scrolled-past sponsored Google search results you typically see on mobile. When old media like Forbes write that “[Facebook] has no idea how it will make money in mobile”, they reveal its them that are clueless.

In fact, I think Facebook has one of the most enduring ad-based mobile monetization strategies out there because its managed to create ads we hardly notice but that still do their jobs — promoting the brands and apps your friends interact with. Imagine how much an app developers like Viddy are willing pay to show this Sponsored Story like that surely drive installs?

The only thing Facebook needs to make that strategy work is a news feed that stays addictive. That’s why it wants to be social layer and data hub, not a traditional mobile platform. If it’s aggregating all the best content created by today’s top mobile apps, and filtering by relevancy to show stuff made by your friends, you can bet that years from now you’ll still have a reason to visit Facebook. Everyday. Like 500 million other people already do.

Facebook Helps Third-Party Mobile Apps Grow Today…So It Can Monetize Their Content With Ads Tomorrow

Evidence Supports Facebook’s Plan To Monetize Mobile With Sponsored Story News Feed Ads

Facebook Mobile Sponsored Stories Mockup

For the first time, Facebook may start showing ads in its mobile apps and HTML5 site, sources close to the company’s ads team tell me. The ads would come in the form of mobile news feed Sponsored Stories — social ads that show a friend’s interaction with a brand rather than traditional display ads which don’t fit on mobile screens. Bloomberg News published earlier today about receiving similar information from undisclosed sources. When I asked Facebook’s ad representative Brandon McCormick a week ago about the potential for mobile news feed Sponsored Stories, he coyly told me “I think that could be interesting.”

More evidence for the plot: Facebook has begun showing Sponsored Stories in its website’s Ticker, possibly to test for backlash. Also, Facebook recently declassified one ad type from being a Sponsored Story to make sure they all require a user action. The strategy could open a major new revenue stream for Facebook in the ramp up to a potential $100 billion IPO.

Two weeks ago I began hearing that through mobile, Facebook might mix ads into the primary news feed — something it has never done before. When I grilled McCormick on whether Facebook would follow this path to mobile monetization, he told me “it’s about getting the mobile experience to be really good, then we’ll think about ways to monetize it. We want a solution that’s going to work for people, we don’t want it to be interruptive, but we want it to be effective for advertisers.”

That sounds like Sponsored Stories, considering a study conducted in May showed the social ads have a 46% higher click through rate and 20% lower CPC. This shows they’re attractive to both viewers and advertisers.

Only permitting Sponsored Stories on mobile would prevent advertisers from injecting irrelevant content that could significantly pollute the news feed. Sponsored Stories are different because they show content that could appear in the news feed organically such as a friend Liking a brand’s Page, checking into a Place, or using an app. Brand advertisers pay to guarantee visibility of these stories, but first must trigger them by courting authentic user interaction.

Because Sponsored Stories actually include the activity of friends, they’re much less likely to piss off Facebook’s historically whiny user base. Last month, Sponsored Stories began appearing in the secondary Ticker feed on the right side of the Facebook web interface and there has been little sign of user protest. As Facebook pulls the news feed for its native mobile iPhone and Android apps from its HTML5 site, it would only have to start showing Sponsored Stories on its mobile website’s news feed to have them reach hundreds of millions of users a day.

Before September, advertisers could pay for “Page Post” Sponsored Stories to have their Page updates gain more visibility amongst their existing fans. However, since these ads didn’t require friends to have taken action, Facebook moved this ad unit type out of Sponsored Stories and renamed it “Sponsored Page Post”. This subtle change could pave the way for mobile news feed Sponsored Stories that always include a friend’s actions, and therefore force brands to focus on driving engagement, not just spending money.

It’s unclear whether advertisers would be able to choose to have their Sponsored Stories shown specifically mobile, or whether Facebook would allocate them across web and mobile. Either way, mobile news feed Sponsored Stories could become a huge revenue driver for Facebook as US mobile ad spend is predicted to reach $1.8 billion in 2012.

To date, Facebook has kept mobile ad-free to fuel widespread adoption, especially in the developing world where there’s still high potential for user growth. But it also may have been waiting until unobtrusive Sponsored Stories were ready for mobile deployment. In the years since its mobile apps and site launched and grew to account for half of the site’s daily active users, Facebook has been stockpiling monetization potential.The company may have planned to announce this new revenue stream just before its IPO to drive up investor interest. The cat’s out of the bag now, though, and secondary market share prices might rise accordingly.

Evidence Supports Facebook’s Plan To Monetize Mobile With Sponsored Story News Feed Ads