The days where advertisements on your Facebook page expanded no further than the right side of your computer interface are now over. On Wednesday, Facebook announced a new website design where companies will be able to display their advertisements on their fans’ main news feeds, their mobile feeds, the right-hand column of their main page, and when the user logs out.
This advertisement expansion, which was announced at Facebook’s first marketing conference in the American Museum of Natural History in Manhattan, is an initiative with two means for both parties that are involved. The investing advertisers are naturally upgrading the mediums for their advertisements, as online streaming and advanced digital television technology no longer compel viewers to view commercials as heavily as they did a decade ago. For Facebook, this increased collaboration with advertisement agencies and companies occurred only one month after Facebook filed for an Initial Public Offering of stock, where they announced that they hope to raise $5 billion.
Another big change in the social media realm that curiously preceded this change is Twitter’s announcement on February 28 that they, too, will soon increase their advertisements to mobile users through displaying “promoted tweets” from companies or brands that the users follow.
A special feature of Facebook’s recent announcement is that the new
Prior to this new announcement, advertisers had little room for creativity and expansion within Facebook’s confines, as they were only able to post advertisements through small and graphically mundane texts that appeared on the website’s right-hand column, and through their own fan pages. With this recent announcement, any status, photo, or content updates made to an advertiser’s Facebook page can be made into an advertisement that is immediately displayed on their fans’ news feeds and mobile feeds. Facebook’s new Timeline layout was discussed during the conference as a major means to improving the creativity, design and flashiness of fan pages.
In 2011, Facebook made 85% of its revenue from advertisers, and the remaining 15% was derived from profit that applications such as Farmville make through Facebook. Facebook’s revenue for 2011 is estimated to be about $4.27 billion, but growth in advertising sales have reportedly slowed down. With the advertisements moving over to Facebook’s Mobile App, IDC analysts expect to see U.S. mobile display advertising jump from $630 million in 2011 to an estimated $5.3 billion in 2012, where Facebook is expected to be the only company capable of competing with Google in terms of profit.
What makes Facebook irresistible to advertisement investors is the slew of information that it can gather on its users’ social and material interests. Facebook receives the largest variety and depth of information from its users than any other social medium, and can therefore very successfully target the right audience. The only flaw in this design so far is that the new premium advertisements appear on news feeds and mobile feeds of “fans” only; this means that essentially all a user has to do to stop the advertisements is simply unlike the fan page.
Photo Credit: Yassef.