Facebook’s Revenues Increase With The Increased Adoption Of Mobiles

Mr. Zuckerberg has long been focused on finding ways of making Facebook more lucrative. Since the IPO launch and its subsequent failure, Facebook has tried and tested multiple revenue generating schemes. On one hand, Facebook introduced Online Gifting (US only) and thus forayed into the e-commerce space. They even launched gifting of iTunes credit to lure music lovers and Apple addicts. In a move that reeked of desperation, Facebook even decided to charge users should they wish to promote their posts.

On the whole, the one major shift that this social media behemoth experienced was the increased use of the mobile platform. With the rapid increase in smartphones, tablets and even phablets, it is common news that more and more people are accessing and monitoring all their virtual avatars on-the-go.

Keeping this in mind, Facebook decided to focus their attention on the mobile platform. In early January, 2013 we reported how 20% of Facebook’s total ad spends are dedicated to mobile ads. Given the number of ads related to apps and services that pop-up when you access Facebook on iOS or Android, I’d say this percentage is being put to optimum use. Now, actual Facebook figures suggest that this massive ad spend has a good ROI. With 23% revenue coming in from the mobile platform, the company’s revenue expanded 40% to touch the $1.585 billion mark.

While analysts praised this performance, they were quick to add that expectations are high going into the next quarter. Aaron Kessler, analyst with Raymond James said, “Overall a solid quarter, but maybe high expectations going into the quarter.” Brian Blau, Research Director in Computer Technology, Gartner said, “The (mobile) trend clearly seems be that users are adopting mobile and that Facebook and advertisers like the results they are getting. Facebook has a relatively easy time generating inventory and finding advertisers to fill that inventory.”

I think the fact that Facebook is finally making promising money on a platform is a good sign for advertisers, employees, Mr. Z and users alike. I say users because once Facebook knows where the money is coming from they won’t force money-oriented changes to TL, etc. on us. As far as ads are concerned, as long as they are non-intrusive I don’t think they will hamper user experience.

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