Facebook’s $1 billion takeover of Instagram sparked the instant reaction that they just couldn’t let the 25-million-strong mobile userbase continue to expand and threaten its position.
Now, Facebook has made what appears a crucial move to ensure it makes money from both the userbase it has captured, and the existing half a billion who use Facebook on mobile devices.
Details on how smartphone app developers could get ad units up and running in the beta test version of this scheme have appeared on their developer blog.
The key highlights of the mobile ads are:
- Mobile ads are aimed at getting people to obtain new apps from the Apple App Store or Google Play directly after click throughs are registered.
- An easy-to-use app dashboard allows choosing the right audience. This is an important feature to prevent an aimless, scattergun tactic of advertising that is wasteful in most cases.
- Spending can be controlled by specifying the maximum an advertiser is willing to pay for each click of the ad.
- A self-explanatory visual representation is designed to help monitor one's ad performance.
Facebook needs to send out a lot of convincing signals to shareholders about its revenue model, following the recent dismal show at the stock market. Recent announcements of fake profiles – indicated to number over 83 million – will surely be the strongest discouragement to advertisers. I'm sure this figure is way too conservative, and that many of their ads might actually be putting off users.
This is not Facebook's first experiment with mobile ads. Earlier this year, they rolled out 'Sponsored Stories' in their mobile app to boost the probability of company posts being read by users.
Users are rapidly migrating towards mobile devices to access the Internet, and the traditional browser-targeted ads may not ensure a stable future for Facebook.