The current state of Facebook ad networks

Guest Post by Sundeep Ahuja

Though the early Facebook application M&A going on is exciting and potentially lucrative for those developers who can build and cash out quickly, more sustainable mechanisms for monetization are quickly becoming the central drivers of application development. In this short post I’m going to take a look at options developers currently have to monetize their apps via ad networks. Although several advertising/referral/affiliate networks have already launched to serve Facebook application developers, there is still tremendous opportunity for improvement.

Selling installations: Slide, RockYou, and SocialMedia
The widget kings RockYou and Slide, along with newcomer SocialMedia, have assembled ad networks that leverage their suite of popular applications and distribution strength. With these networks, you can promote other applications on your app and advertise your application throughout their networks. CPI, or cost-per-install (basically CPA), is an interesting monetization option with these networks. By embedding a code snippet in your app, they can track which apps in their network are generating installations of yours (a yet-to-launch company called Adonomics will be doing this as well).

Starting to target: Lookery, Cubics, appfuel
These new firms are dedicated Facebook ad networks with an intelligent twist. Lookery is offering branded content on a CPM basis with basic targeting starting last week. Cubics claims precise demographic targeting for advertisers (something that Microsoft has yet to do well with its Facebook real estate). Yet to be launched appfuel (where I’m a co-founder*) is taking a contextual approach (a la Google AdSense).

Cross promotion networks: fbExchange, CanvasExchange
Both fbExchange and CanvasExchange are Facebook-grown application cross-promotion services, though I expect them both to offer branded and other promotional content to publishers very soon. For now, they’re better for marketing/promotion than monetization.

…And the rest
Then there are always the .com world widget options (UserPlane, AdSense, Azoogle, etc.), affiliate/CPA options (both direct affiliate programs like Amazon or iTunes, as well as networks like LinkExchange and NeverblueAds), video networks (though VideoEgg just launched EggNetwork to sell rich media placements), and of course, lead generation (Adteractive, Peanut Labs, etc.).

Can any developers speak for how well any of these options are working for you? Please comment below and join this Facebook group on monetizing applications.

*The appfuel network will officially be launching in alpha later this week.

[tags]facebook,adnetworks,marketing[/tags]

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Leave a Reply

13 Responses to “The current state of Facebook ad networks”

  1. Charles Hudson says:

    The larger question, in my mind, is whether Facebook ought to develop and launch their own advertising offering for people looking to build on their platform. I’m still not convinced that they’ve ruled it out or don’t have plans to do so – they’d be crazy to not do something. This is an otherwise good roundup of the current solutions.

  2. Kevin Prentiss says:

    I had breakfast with Mike Jones (CEO of Userplane) the other morning and he mentioned that they were writing very nice checks to a few well situated facebook app developers.

    Probably can’t say how much, but it was a number that would make a comfy little business, even with a decent hosting bill.

  3. Alex Gaynor says:

    Well, I’m a user of both Lookery and fbexchange, between the two of them I have mad about $2 in the past few weeks, however I think Lookery’s should increase in the coming weeks as they begin to increase CPM payout in parallel to their increased targeting, and also my app only has 3000 users, so its not particularly large.

  4. dave mcclure says:

    nice summary sandeep… but when did you quit American Idol to start writing for Justin?

    (i keed, i keed ;)

  5. The current state of Facebook ad networks (original, un-edited version of the post :) | appfuel says:

    [...] over at Inside Facebook was kind enough to publish an edited guest post I wrote about the current state of Facebook ad networks (thanks again Justin!). The original, un-edited version is below; the main differences are that [...]

  6. Are Facebook Ad Networks Worth the Trouble? | Charles Hudson’s Weblog says:

    [...] the full version of his post about Facebook ad networks here (a redacted version was posted on Inside Facebook yesterday. I think it’s a good overview of what’s happening in the Facebook ad universe [...]

  7. supun says:

    how does facebook determine which of the apps are the most popular for each category? Could that be a source of monetization as people try to get more exposure to their apps. I haven’t been able to figure how they decide which of the apps are most popular for a certain day. It doesn’t appear to be installs/ prior day. Could they be selling it as a placement?

  8. pandamatak says:

    Supun – If you look in the developer forums, you will find your answer. FB determines popular apps based on user-engagement-heuristics. It does not (as far as I can tell) sell placements or installs unlike appsaholic. The more “active” users your app has, the more fb-popular it will be, where “active” has defined in the developer forums to mean “interacting with your app” among other things.

    Hope this helps.

    &

  9. Liens sur les nouveaux modèles économiques : Musique, Blogs, Applications Facebook « So chouette! says:

    [...] Elles cherchent encore leur modèle même si les revenus publicitaires semblent le plus évident. Inside Facebooks fait un point sur les différents réseaux publicitaires sur Facebook (article qui intéressera [...]

  10. Acheter (ou vendre) de la publicité sur Facebook « So chouette! says:

    [...] d’infos dans cet article que j’avais déjà partagé: http://www.insidefacebook.com/…/the-current-state-of-facebook-ad-networks/ Posted by cyresne Filed in E-Marketing, Facebook Tags: promotion application, promotion [...]

  11. Inside Facebook » Top 10 Facebook Stories of 2007 says:

    [...] Facebook application developers. Over the course of the summer, several ad networks were started to sell Facebook application inventory. In September, Mark Zuckerberg announced the formation of the fbFund, a Facebook-affiliated fund [...]

  12. xocal.net v2.0 » links for 2008-02-14 says:

    [...] Inside Facebook » The current state of Facebook ad networks (tags: ee614) [...]

  13. O.RACHID says:

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