4 thoughts from Facebook’s Q1 2014 earnings call

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Facebook is gaining influence in Asia

One of the biggest areas of growth for Facebook has been Asia. In Q3 2013, the daily active user (DAU) count in Asia surpassed Europe and it grew to more than U.S. and Canada the year before. The revenue coming from Asia has grown steadily, too. In Q1 2013, Facebook reaped $176 million in ad revenue from Asia — a figure which has grown to $333 million. While worldwide, there was a sizable drop in average revenue per user, there was very little dropoff in Asia.

The plan for apps: scale, then monetize

CEO Mark Zuckerberg said he’s not worried about making money from WhatsApp right now. The plan for WhatsApp, as well as Instagram, Messenger and Paper (as well as any other app Facebook might release or acquire in the future) is to acquire users, then figure out how to make it profitable. Zuckerberg said that both Messenger and Instagram have surpassed the 200 million user mark, but monetization isn’t an immediate concern:

For the next set of apps like Messenger, Instagram and hopefully soon WhatsApp, the current priority is growth. Messenger and Instagram both reached 200 million monthly actives this quarter. We believe these apps have a lot of room to grow and will start to be important businesses in the future, but monetization isn’t our near-term priority here.

And for the new apps that we’re building as part of our Creative Labs effort, we’re still in the very early stages of development. We’re working hard to develop the technical foundations for these services so that we can rapidly launch new products and then refine them based on the initial feedback from our community.

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Facebook in Q1 2014: More than 1B mobile MAUs

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Facebook truly is a mobile company. The social network announced its Q1 2014 financial and user figures, showing that now there are more than 1 billion mobile monthly active users around the glove.

Overall, Facebook has 1.27 billion MAUs and 802 million DAUs.

Below are some more key charts showing Facebook’s Q1 performance.

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SHIFT Q1 report: call to action buttons, video are winners for Facebook advertisers

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One of the most popular ad tools for Facebook marketers in Q1 was the call to action button. As Facebook adds more calls to action, brands have been flocking to the tool as a way to get installs, signups and conversions.

James Borow, CEO of Facebook Strategic Preferred Marketing Developer SHIFT, talked with Inside Facebook about how successful call to action buttons were in Q1 2014, as well as the way that more advertisers are adopting video. Borow told Inside Facebook that when a marketer uploads a video directly to Facebook, rather than a site like YouTube, the ad tends to perform 5 times better. Additionally, among SHIFT clients, there has been an 80 percent increase in video spending on Facebook.

Inside Facebook: How was this year’s Q1 for Facebook advertisers?

James Borow: Q1 has been incredibly strong on Facebook. Year over year, in comparison to Q1 2013, we’ve seen a dramatic increase in spend. The News Feed in mobile, in particular, dominates. We really are seeing a persistent shift to mobile from desktop. I think that we’re seeing that performance of the channel continues to be incredibly compelling, in terms of actually delivering ROI for the advertisers. Facebook is becoming not just a social channel, but a marketing channel for meeting business goals. That’s really come into clear focus this quarter.

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Nanigans Q1 report: more Facebook ad money being spent on women

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Nanigans, a Facebook Strategic Preferred Marketing Developer, recently released its Q1 2014 Facebook advertising trends report, finding that advertisers recognize the value of their female audience on Facebook and that teens don’t have money to spend.

From Q1 2013 to Q1 2014, Facebook advertisers allocated 63 percent of their budget to women and just 37 percent to men. Nanigans found that on average, ads targeted toward women cost 12 cents more than men, but delivered a 39 cent higher revenue-per-click. When they examined key performance indicators by age group, the revenue-per-click data suggested that the teen demographic, those 18-24, was the worst monetizing demographic and 45-54 was the best performing age group.

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Adobe Q1 report: clickthrough rate up, cost per click down

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Adobe, a Facebook Strategic Preferred Marketing Developer, released Monday night its Q1 2014 Social Intelligence Report, showing that Facebook’s ad performance has kept chugging along — especially on Fridays.

Among Adobe’s clients, cost-per-click (CPC) is down 2 percent year-over-year and 11 percent quarter-over-quarter, while clickthrough rate (CTR) rose 160 percent YoY and 20 percent QoQ. Facebook ad clicks overall were increased by 70 percent YoY and 48 percent QoQ. Impressions are up 40 percent YoY and 41 percent QoQ.

Joe Martin, a Senior Analyst for Adobe Digital Index, talked with Inside Facebook about Facebook’s ads performance in the first quarter of the year:

A lot of the Facebook changes are around making sure people see the content they want to see. Even though that’s making brands possibly pay for more impressions than they were before, it’s keeping News Feeds clean of excessive brand posts. If I like 100 brands, and I saw every post, that’s all I’d ever see on my News Feed. So Facebook is really rewarding people for original content, media-rich content and people are responding with some higher engagement rates.

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3Q Digital Q1 report: 45 percent increase in mobile ad spend on Facebook

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Facebook will announce its Q1 2014 financial report on Wednesday, but reports are pouring in from analysts and Facebook Preferred Marketing Developers.

3Q Digital, a digital advertising agency, shared with Inside Facebook samples of its clients’ performance on Facebook for the previous quarter. They found that mobile is still going very strongly for Facebook in Q1, as the company has seen a 45 percent quarter-over-quarter increase in spending on mobile.

Dayna Moon, 3Q’s Senior Director of Social Advertising, commented on Facebook’s Q1 advertising performance:

It’s safe to say we’ve moved beyond the “Year of Mobile” to the “Decade of Mobile” and can continue to place bets on the next targeting craze. I’m rolling my dice on the geo side, as Facebook announced an optional rollout of the “nearby friends” feature early this week. Marketers are likely to see this feature “pop-up” sooner rather than later.

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Report: Facebook to announce mobile ad network at F8

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Advertisers are increasingly falling in love with Facebook’s mobile ad offerings, but a more powerful solution may be on the way.

According to re/code, Facebook will reportedly announce next week at F8 a mobile ad network that would allow advertisers to utilize Facebook data for targeting outside of Facebook. The company started testing this on a small scale in January and a few executives from Facebook Preferred Marketing Developers have said that an external ad network is the logical next step.

Facebook declined to comment, which is standard procedure for rumors.

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Can Facebook, Instagram posts predict buying behavior?

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There’s an interesting way marketers are reaching out to customers through Facebook, Twitter and Instagram. When users post that they’re pregnant, or recently engaged — or another significant life event — that’s data marketers can use to predict buying behavior.

Viralheat, a social marketing management firm, says that many clients are seeing success by tracking this type of conversation. For instance, a variety of retailers could target ads toward a user (or join the discussion) who posts a picture of a ring on Instagram with the hashtag #Engaged or makes a public post about an engagement.

Viralheat spoke with Inside Facebook about how brands can use more information that users freely post in order to turn fans into influencers.

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Case Study: Retailer uses Custom Audiences to drive 35:1 ROI

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One of the most popular ad tools on Facebook right know is Custom Audiences. An online retailer recently tapped Facebook Preferred Marketing Developer SocialWire to reach current customers with targeted ads via Custom Audiences, experiencing an average last-click return on investment of $32 for each $1 spent.

The campaign opened up the client’s inventory of 50,000 products, pushing advertisements for 600 of them. SocialWire found that 89 of these products had an ROI greater than 35:1, with some hitting as high as 45:1.

How did they do it?

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Infographic: Q1 performance of search vs. Facebook ads

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One of the biggest questions in online advertising is whether search or social advertising is the best route to go.

Kenshoo, a Facebook Strategic Preferred Marketing Developer, recently compared how search advertising is performing in Q1, compared to Facebook ads. Though Facebook advertising’s cost-per-click has risen 35 percent year-over-year, it has decreased 26 percent quarter-over-quarter.

Other key findings (YoY):

  • Search ad spend increased 10% and Facebook spend increased 37%
  • Search advertiser revenue increased 12% and Facebook revenue increased 191%
  • Search clicks increased 8% and Facebook clicks increased 1%
  • Search average cost-per-click was $0.59 (up 2%) and Facebook was $0.25 (up 35%)

Learn more about the trends in search vs. Facebook advertising by reading below.

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