2012 Gave Facebook A Lesson In Mobile

Facebook didn’t launch its first mobile-only advertising product until June. Since then, it has built one of the biggest mobile advertising businesses in the world.

2012 Gave Facebook A Lesson In Mobile

Facebook had 425 million mobile users, but no significant mobile revenue, when it filed for its IPO in February.


Mobile users were visiting the site more often and staying longer than their desktopped counterparts. But because Facebook had no significant mobile advertising products, this increasing mobile usage was a liability rather than an asset.

“If users increasingly access Facebook mobile products as a substitute for access through personal computers,” the company admitted in a late addition to its filings, “and if we are unable to successfully implement monetization strategies for our mobile users, or if we incur excessive expenses in this effort, our financial performance and ability to grow revenue would be negatively affected.”

So began a year of mobile advertising experiments. Facebook’s first mobile-only advertising option, Sponsored Stories for the News Feed, launched in June. Its second mobile-only product, which launched in August, takes advantage of Facebook’s app-store popularity to advertise other apps.

Not all of Facebook’s experiments in mobile monetization have been immediately successful. Its experimental third-party mobile ad network got put on pause this month. And reactions to Instagram’s new terms of service suggest that monetizing its new mobile star without offending its users may be more difficult than anticipated.

But Facebook’s earnings reports speak for themselves. At the beginning of the year, the company had virtually no mobile advertising revenue. In the third quarter, it had $150 million worth–about 14% of its advertising revenue. Just six months after launching its first mobile advertising product, Emarketer estimated that Facebook would bring in more mobile ad revenue in 2012 than any other company besides Google.

[Image: Flickr user Striatic]

About the author

Sarah Kessler is a senior writer at Fast Company, where she writes about the on-demand/gig/sharing "economies" and the future of work.