Spike in Facebook Ads Boost Profits
A major surge in mobile ads-driven revenue is being credited for an increase in Facebook’s profits this quarter. The second-quarter profits at the social media giant were mainly boosted by a 50% increase in sales, amounting to a total of $ 1.81 billion. The increase in sales also had an effect on the stock price of the company, which increased by about 19%.
According to Facebook, the big boost in business and sales has been thanks to its burgeoning mobile ad business, which accounted for $656 million in sales this quarter. That is an increase of 11% over the previous quarter. According to the company, the mobile ad business now accounts for approximately 41% of its total advertising business.
Clearly, Facebook has found that the way to stay ahead of the game is to focus on mobile advertising. In this critical area, Facebook has done exceedingly well, with focus on attracting more small businesses to advertise on Facebook likely to increase in the months ahead. The company now says that it has 1 million registered active users, which is an increase of 27% from the previous year. The company now also has 1 million active advertisers, and is making a huge push in the local business advertising market.
Facebook has underestimated the mobile industry for some time now, and many had believed that the company would never be able to shake off the desk-top culture that many of its users are addicted to, and be a viable platform for mobile marketers. That is however no longer true, and over the past few months, Facebook has been increasing efforts on its mobile business, focusing on local business ads.
Advertisers have been lured with an array of new advertising tools, as well as social media products. For instance, Facebook has introduced mobile app install ads that allow the download of third-party apps. These tools have been credited for an increase in Facebook sales and profits this quarter. The company has focused especially hard on local small businesses, and has made it easier for local businesses to buy ads on Facebook directly through an automated process that makes it easier to access product offerings.
However, Facebook still accounts for a small slice of the mobile marketing market. Currently, the company accounts for just over 4.1% of the $ 104 billion mobile advertising market, and no doubt will be looking at increasing that share in order to drive revenues further.
With this ever increasing shift in advertising dollars to mobile, every business should be taking a look at their overall marketing strategies to capitalize on reaching their audience more affectively.