At its F8 developers conference, Facebook fulfilled expectations and announced a mobile ad network that will allow brands to advertise on third-party apps using the social network's data. The Facebook Audience Network (FAN) gives advertisers the chance to target Facebook users across apps based on all the information they've shared with the social network.
With more than a million advertisers using its platform, mobile advertising has become a huge part of Facebook's business, accounting for almost 60% of its ad revenue, up from 30% a year ago. In its most recent earnings call, the company reported first quarter profits of $642 million, with mobile advertising being credited with helping it boost quarterly revenues by 72%, to $2.5 billion.
Its access to so much personalized data will arguably give advertisers a richer targeting experience on mobile, making it a serious rival to other ad platforms like Google's AdMob. Cathy Boyle, a senior mobile analyst at eMarketer says the new product will put pressure on those other players. "There’s a lot of money flowing into mobile advertising and this will help it grow even more by making it easier for brands already working with Facebook to spend more, because they have that relationship and know the interface," says Boyle. "More money will flow into mobile as a whole, but Facebook certainly looks poised to get a larger share."
Chia Chen, Senior Vice-President and North America Mobile Practice Lead at DigitasLBi, likes what he sees in how the new ad network addresses three major issues facing marketers in mobile right now: Measurement, targeting, and cross-screen reach. "The initial release of the Facebook mobile ad network is about driving app installs, which is very measurable," says Chen. "Brands want to use consistent targeting techniques where possible, but they also want them optimized in each channel. This lets them extend [Facebook's] unique targeting capabilities onto other properties. The new network also opens up the possibility of being able to do true cross-screen frequency and reach, to know that you’ll reach someone a certain amount of times on mobile versus desktop specifically, instead of just knowing that you’ve reached them a few times on various screens."
And while engagement on other social mobile platforms might rival Facebook, the new network taps a key advantage of the original social network. "Snapchat, Twitter and the like have much more actual engagement now than Facebook, whose newsfeed became ad dominant and the platform now feels akin to a broadcast medium," says Leo Burnett Worldwide's Head of Social and Mobile James Kirkham. "Unlike these purist platforms which grew up mobile first though, Facebook was first and foremost a social network packed full of personal data. It literally knows more about you than anything else. The Facebook Ad Network is primed to deliver advertising to people with an uncanny amount of intel, with laser sights trained on every single person. There are more exciting elements too, where custom ad units are built tailored to fit the apps they’re hosted in, effectively dominating your whole mobile eco-system."
During the presentation, which also included announcements of mobile like button, anonymous app sign-in, and the ability to share items from third-party apps using Facebook Messenger, Zuckerberg said that Facebook has been responsible for 1 billion app installations to date and highlighted its earning potential for app developers. "I'm really excited about this Audience Network," he said. "This is really the first time that we're going to help you monetize in a serious way on mobile."