Facebook is gearing up to display advertisements on tablet and smartphone applications. The advertisements will begin to appear as early as March.
The move comes prior to the initial public offering and is one way for the social networking giant to snag more revenue opportunities. It’s probably the tip of the iceberg and we can look forward to Facebook seeking out more money-making momentum as the year moves along.
Facebook is calling the mobile ads “sponsored stories” and will inject them into feeds within weeks. Advertising agencies have apparently been lining up to submit proposals for the feature.
With half of all Facebook users accessing their accounts through mobile devices, it was only a matter of time before the site put mobile advertising in the game.
“We do not currently directly generate any meaningful revenue from the use of Facebook mobile products, and our ability to do so successfully is unproven,” said Facebook in its IPO filing with the United States Securities and Exchange Commission. “Accordingly, if users continue to increasingly access Facebook mobile products as a substitute for access through personal computers, and if we are unable to successfully implement monetization strategies for our mobile users, our revenue and financial results may be negatively affected.”
Facebook has made some money from mobile devices thanks to Facebook Credits, a $557 million goldmine for the company. It’s not clear how much of that dollar amount comes from mobile avenues, of course, but one has to suspect that a good chunk of it does.
Facebook will be up against a few roadblocks when it comes to implementing the advertisements, of course. They’ll have to ensure that the ads aren’t too invasive, for one thing, and will need to keep issues like aesthetics in mind. Considering that most mobile users have limited space to view wall posts or make their way through their news feeds, taking up space, even 10 percent of it, with a mobile ad could be problematic.
“Sponsored stories” will be theoretically integrated right into the news feed. Users who endorse those brands will have their posts highlighted, saving Facebook from having to deal with large block or display advertisements on the side or bottom panels.