For years now mobile has been the buzzword in digital marketing. People always underline how much potential the channel offers and the opportunities for advertisers. Therefore, one question pops up every so often: Could mobile advertising someday be more profitable than desktop ads? The answer is: YES! And Facebook shows how it works!
The customer journey analysis still has one major flaw and that is the media break. The reason for this is that there is still no established solution of how device changes can be mapped. Mobile and desktop are often independently evaluated. Due to this fact, it is not possible merging both channels together, evaluating them within the context of the customer journey. In addition, there is no standard solution yet for inn-app tracking. Thus, we don’t know how users navigate during mobile activities.
So the next important step in the online hemisphere would be to overcome the hiatus. Because mobile advertising is becoming increasingly important. Facebook shows how significant the influence can be:
The revenue Facebook is currently generating with mobile ads is increasing impressively. There is also no sign that this situation may change in the near future. In 2013 Facebook announced that mobile products wouldn’t generate significant revenues. Now, it seems like the social network was wrong.
In 2013 Facebook’s mobile advertising already accounted for about 45% of the advertising revenue. This amounted to 6.99 billion US$. According to the market research institute eMarketer mobile will make as much as 75% of the advertising revenue by 2016 or an estimated US $ 7.39 billion. If these forecasts are accurate, Facebook is well on the way to crack the $ 18 billion mark in 2016 in terms of revenue. In general mobile ads are sold at lower prices compared to desktop advertising inventory. There are of course many reasons for this: One of the main one is the common belief that mobile fewer generate less sales. In addition, a mobile device simply has less inventory space than a traditional laptop or computer screen, which can be filled with advertisements.
But what are the reasons why Facebook’s mobile ad package work that well? EMarketer Analyst Debra Aho Williamson said: “Because the Facebook experience is basically the same across devices, advertisers don’t have to reinvent the wheel to place mobile advertising. As Facebook’s user base shifts even more heavily toward mobile, it is well positioned to see increasing ad revenues from this channel.”
EMarketer assumes that Facebook will be able to record up one billion mobile users until the end of the year. This value is expected to even grow to 1.34 billion by 2018. This means that 75% of all users mostly access the website and app via mobile devices. The majority of these users are currently from the United States (123.1 million mobile accesses this year). But even here some changes are expected in the coming years. By 2017 India will have overtaken the United States with 167.7 million mobile users. Other markets, such as Indonesia, Brazil and Mexico are also taking an increasing part of the Facebook mobile audience.
In 2014 Facebook bought many companies. Always aiming at increasing traffic as well as the commercial revenues in emerging markets. Examples are the purchase of Little Eye Labs, a startup based in Bangalore, which offers mobile app analysis tools. The most heatedly debated purchase was probably the acquisition of Whatsapp. According to Statista, the popular messenger app recorded 70 million active users in India just in November last year.
Considering these investments, it is not at all surprising that Facebook looks upon commercial success in the mobile area. It really makes sense considering the fact that more and more users access websites and apps and buy things. Online marketing players have to adapt their strategies to this change. In order to display advertisements efficiently and effectively in the future, a wide range of high quality tools for mobile or in-app tracking will become more important.