Facebook turned around the whole social networking game when they introduced ads on the website. Over the years it has become a very profitable entity and at the same time has managed to keep its service absolutely free.
There has been a lot of buzz lately about the Timeline for brands after their official announcement. All brand pages will be shifted to the new look in 30 days.
The announcement is most important in terms of mobile advertising. They have announced that they will now show sponsored stories in the Facebook mobile news feed. This is very similar to what Twitter is doing with ads on its platforms. Twitter is adding promoted tweets straight in the timeline. This move has been received less enthusiastically by users on Twitter.
Inserting ads in mobile is a risk for Facebook and they have even listed their mobile offering as an investment liability in their IPO filing. Now, this is where the challenge lies for the giant which has already conquered most of the social networking world. Sponsored stories might work but they depend on the quality and types of those ads. People interact with brands more on Facebook than Twitter. A cleverly worded update with an image which can resonate with a particular type of audience may just do the trick for Facebook. Facebook will need to sort out its ad targeting mechanism and put the impetus on brand marketers to be creative with the ad content.
As far liabilities are concerned, Facebook doesn’t stand to lose much because of their large user base. Normally, after a feature change, Facebook sees a dip in engagement but slowly the changes are adopted by everyone and become the new standard. This is exactly what might happen here.
What are your thoughts on Facebook putting ads on its mobile apps?