Facebook Exchange transformed advertising on the site. Will FBX Mobile make history repeat itself?
Any advertiser who had display ads on Facebook in early 2012 would say the same thing: the ads sucked. Untargeted, low click-thrus, poor performance, bad placement and a complete lack of reliable analytics gave advertisers good reason to give up on the site. Then came FBX and the site's push into programmatic advertising: now marketers could bid on display inventory and retarget based on browsing data.
The expected happened: click-thrus went up, performance increased and prices rose. Facebook's stock recovered from its crater and everyone lived happily ever after.
Now if you ask an advertiser how Facebook is treating them, they'll probably say that it's doing great. App installs, e-commerce and Facebook activity are the low-hanging fruit that FBX plucks for marketers with minimal effort and, importantly, minimal spend. The FBX story is a big win for programmatic advertising, for self-serve advertising and for data-driven marketing.
But not all is well in the social media advertising world. Now that Twitter is looking to expand its advertising offerings, Facebook is seen as old hat. Plus, what about mobile? Sure, click-thrus remain strong on Facebook's mobile app and user engagement hasn't dropped off. But the ads are getting stale and many marketers remain frustrated that recent browsing history cannot be leveraged to retarget ads on mobile phones.
Facebook has been working to change that with FBX Mobile, which is essentially designed to mimic the retargeting abilities of FBX on the desktop. In addition to expanding its API partner list and offering greater visibility to advertisers, Facebook is positioned to offer that elusive cookie-based retargeting opportunity on phones and tablets.
How? Simple--it has the browsing data for users on the desktop, and it has the user's data on the phone and tablet, so why not simple serve ads on the tablet that are relevant based on the desktop browsing?
It's a simple concept but technologically very difficult, which is why FBX remained in beta for a while. Plus, Facebook is hardly the only company that can offer such cookie-on-the-phone opportunities. With Google Now, the search engine giant is perfectly positioned to leverage search, browsing, and user behavior data to serve relevant ads on phones and tablets at scale. If Google+ ever takes off and the forced real-name transition on YouTube gets the company greater social data to integrate into AdMob, the company will have even more data to use to serve ads than Facebook.
What's a marketer to do? Well, third-party retargeters need to adapt quickly. If they can offer an improvement to ROI on mobile devices with proprietary technology, they can serve a symbiotic function with the big two. If not, they'll find advertisers shrug them off as unnecessary.
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