Facebook, Inc. (NASDAQ:FB) CEO Mark Zuckerberg admitted in his company’s earnings conference call last month that mobile is where the future is for computing, but it is also the weak spot in his company’s ability to monetize its ubiquitousness. Zuckerberg said that mobile users are 20 percent more likely to use Facebook on any given day than a desktop user, and the company reported 543 million mobile users on Facebook by the end of June.
And, he predicted that the mobile audience will grown to 4 to 5 billion in the next five years – from about 600 million now. So for Facebook, Inc. (NASDAQ:FB) to admit it needs to improve its cash flow for mobile, one would think that would become a pretty high priority. A new story revealed that Facebook is looking to beta test a new way of mobile advertising – allowing app developers to advertise inside the news feeds of Facebook’s mobile users. Facebook is currently asking developers to pilot this idea, which includes giving the developers a choice to target users of the Apple, Inc. (NASDAQ:AAPL) iOS App Store or the Google, Inc. (NASDAQ:GOOG) Android Google Play store.
The concept would allow developers to advertise in users’ mobile news feeds (pay Facebook a fee to do so), and as a user clicks on the ad, the user is redirected to the appropriate store to download and/or purchase the app. Facebook charges each developer for each click-through, and the developer can set a maximum budget.
This is not the first look at monetizing mobile for Facebook, Inc. (NASDAQ:FB); it’s just the latest. The company had experimented with paid-for “Pages You May Like,” as well as “Sponsored Stories,” in which advertisers post material, and if a user or “friend” shares the material with other friends, the advertiser pays a fee to increase the likelihood the material would be seen.
Advertisements in the News Feed is the latest attempt by Facebook, Inc. (NASDAQ:FB) to monetize mobile – and it could be the mose effective way at this point, considering the universality of the News Feed. We’ll see how the beta test transpires, but it’s at least a start to try to give investors some hope of return.