In Q4 of 2012, Facebook was able to show an increase in online marketing with mobile ads to comprise 23% of its total ad revenue. To illustrate the growth of Facebook mobile internet advertising, the ad revenue from mobile ads was 0% of Facebook’s advertising revenues as recently as February of this year.
The reason for the growth of online marketing is simple. Facebook is able to offer more targeted online display ads than the competition. AOL, Yahoo, Bing, etc. can collect your location, device type, operating system, connection type, and what you’re currently accessing. Google knows all of these things, but also can access your search history and your information from your Google + profile.
Facebook does not know your search history, but has access to your Facebook profile data, who your Facebook friends are, your likes and your Graph Search history. By tracking embedded Like buttons, Facebook knows what your web browsing favorites are. Facebook has the information to allow advertisers to pinpoint their web audience. Pinpoint targeting of mobile internet advertising is more important than traditional internet ads because a mobile ad can occupy the entire mobile screen. Irrelevant online display ads will frustrate mobile users and drive them to other platforms. Facebook claims that with the targeted ads on the news feed, engagement was reduced by only 2% this year.
Bottom Line: Facebook mobile internet advertising is are growing because they work. If Facebook can continue to deliver targeted ads in the face of challenges to their privacy policies, the platform will continue to grow. Google continues to refine targeted delivery of online display ads by using search history and as the sophistication of big data increases, Google + data and profiles will become more valuable in serving targeted online ads. Either way, online marketing will benefit.