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According to earnings reports, Facebook generated $1.086 billion in advertising revenue in Q3, suggesting that about $152 million came from mobile. It’s worth noting that Q3 was the first full quarter that advertisers had the option to specifically purchase mobile inventory. Sponsored Stories began appearing in mobile feed in March, but advertisers couldn’t control their placements until June. CFO David Ebersman said on today’s earnings call that ads in News Feed are now generating about $4 million per day, with three-fourths of that from the mobile feed.
Mobile growth and opportunity was clearly the theme of the investor call today. CEO Mark Zuckerberg said that mobile is the “most misunderstood” aspect of Facebook’s business, iterating a point he made last month about mobile being “fundamentally good” for the social network. Zuckerberg noted that mobile users are more engaged on a daily basis than non-mobile users, and that its mobile ad products are and will continue to be more deeply integrated into the experience rather than off to the side as they are on desktop. He said that although it might have seemed that Facebook couldn’t monetize mobile earlier this year, that was because the company simply hadn’t tried yet.
In the past eight months, though, Facebook has introduced several opportunities for mobile revenue. On the ad side, there’s Sponsored Stories, page post ads, Promoted Posts and app install ads. These are all directly within the feed, and advertisers across the board are seeing higher clickthroughs and engagement with these units. COO Sheryl Sandberg noted that page post ads in News Feed (including desktop and mobile) are eight times more engaging than the same ads in the right hand column, and they have a 10 times greater ad recall per impression. This is in line with what we have heard from a number of Preferred Marketing Developers testing these ads.
App install ads benefit from being a “uniquely mobile” product, Sandberg says, though those ads are in very early stages. The product came out of beta last week. Another mobile-first advertising venture is the mobile ad network still being tested with select partners. These aren’t having an effect on Facebook’s earnings yet, but lay the groundwork in areas with a lot of potential for growth. Sandberg says that within eight months, Facebook has become one of the largest mobile ad platforms in the world.
Offers are another product with an opportunity to drive revenue on mobile. Since launch, about 100,000 pages have created an Offer and about 30 percent of Offer claims are coming from mobile devices, Sandberg says.
Separate from Facebook’s ad business, the company also announced Facebook Gifts just before the end of Q3. The product, which allows users to buy actual goods for their friends, was spun out of the social network’s acquisition of Karma and has a significant mobile component. It is still being rolled out in the U.S.
And although Facebook hasn’t made any moves to monetize Instagram, Zuckerberg said that the mobile photo-sharing app has gone from 27 million registered users since before the acquisition to more than 100 million today. There is more mobile time being spent on Instagram than on Twitter, he pointed out.
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