Facebook thanks mobile for ad revenue boost while Google struggles
Facebook and Google are ramping up mobile advertising efforts--with varying degrees of success.
The former saw 59 percent of overall ad revenue come from mobile in the 2014 first quarter, representing a 30 percent increase from the first quarter of 2013.
To further capitalize on mobile, Facebook announced this week that it is launching a mobile ad network called the Facebook Audience Network--"a new way for advertisers to extend their campaigns beyond Facebook and into other mobile apps," explains the social network in a blog.
Google, however, blamed mobile for a 9 percent decrease in costs-per-click in the 2014 first quarter, explains a report by Todd Wasserman at Mashable.
It's not as though Google is shrinking in overall ad revenue, which actually grew by 16.5 percent last quarter, according to Mashable. But that percentage is not enough--and shareholders are disappointed.
So what gives?
Wasserman says that the explanation is simple: Facebook is a younger company and its core infrastructure around advertising is responsive to the needs of the changing market. It was 2009 before the social network became serious about gaining profits from ads.
One of the main perks Facebook has going for them is ads on its News Feed.
Ads directly embedded in the News Feed are not only larger in size; they are worth more than ads that are located on the side and they're the only ads seen in mobile.
The amount of information Facebook collects on its users doesn't hurt either. Ryan Tate of Wired refers to this as "the benefit of running a social network." He is quick to point out that Google+ is also a social network, but it is "an also-ran to Facebook" and "[gives] advertisers fewer targeting options."
Google is no newbie in the ad game, which makes its positions more calcified. "The fact that Google is further along in its advertising evolution works against the company," Wasserman writes.
But that isn't the end of the story for Google. According to both the Mashable and Wired articles, Google still holds the largest share in the U.S. mobile ad market. The difference lies in Facebook's youth and ability to grow at a faster pace.
The main takeaway, it seems, is that Facebook is a force to be reckoned with due to the amount of people viewing and responding to ads primarily on mobile devices, which, according to Tate, "represent the future of both computing and online advertising."
- check out Facebook's blog
- read the Mashable article
- read the Wired article
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