Facebook Brings Autoplay, Better Targeting To Its Mobile Ad Network, Grows Its Marketing Foothold

A carousel ad, one of several new advertising features Facebook recently introduced to its mobile ad network. (Courtesy of Facebook)

The auto-play video ads that users see when they check their news feed have been a big money-maker for Facebook. Now, the social network is bringing auto-play advertisements and several new features to apps in its mobile ad network, giving Facebook more ways to expand its influence in the digital advertising market.

The auto-play ads and new features will be available to publishers and developers on the “Audience Network” on Apple’s iOS and Android, the company said in a post on Tuesday. The move gives Facebook the chance to sell more video ads to marketers without upsetting Facebook users by putting more ads on its own apps.

“The Audience Network has been allowing third-party apps to monetize users for a while, and now these apps will see a greater return with a more diverse set of ad units to show,” Jan Rezab, CEO of social media analytics firm Socialbakers said in an email. “Introducing auto-play video here is a smart move for Facebook. It’s been performing well for marketers on the Facebook platform, and it’s a format that’s becoming very familiar to users.”

Facebook’s mobile ad business makes up a growing portion of its overall revenue. In the three months ending on June 30, mobile accounted for 76% of advertising revenue, up from 62% a year earlier. Digital video advertising revenue in the U.S. is expected to rise 34% to $7.77 billion this year, according to forecasting firm eMarketer.

In addition to autoplay ads, Facebook is making other new formats available to apps on the network who support full-screen ads. These apps can now be included in marketing campaigns that show product ads, known as “dynamic product ads,” to users based on items users have browsed on the web. Other new formats include carousel ads, which display a series of images, as well as a click-to-play video ad tool.

“The new features Facebook is rolling out for dynamic product ads mean ads will be more deeply targeted and relevant to the users they’re shown to,” said Rezab. “Facebook is trying to allow marketers to prioritize customers who will make a purchase.”

Facebook created its mobile ad network last year. Native ads now make up more than 80% of impressions on the network.

The social network has been scaling up video ads on Instagram and recently launched spherical and embedded videos. Facebook says it generates 4 billion video views per day, but has come under pressure for promoting this metric. Facebook counts a video view as three seconds, including views of auto-play videos, while its competitor Google-owned YouTube usually counts a view at around 30 seconds.

Video creators have criticized Facebook’s video view metric, saying that many of the videos Facebook counts in its tally were lifted from their original source and uploaded through Facebook’s native player, rewarding the Facebook page for the view and failing to reimburse the content creator. Video creators have also said that three seconds is not long enough to claim that a viewer was meaningfully engaged with a video, especially when YouTube tends to count views much later. In a blog post, YouTube star Hank Green noted a report from the ad agency Ogilvy and Tubular Labs that found that more than 70% of Facebook’s highest performing videos came from other sources, such as YouTube.

Facebook has responded to many of these criticisms, saying it has a system to help prevent unauthorized videos from being uploaded to its site, as well as tools to allow content owners to report potential copyright infringement. The social network said it removes unauthorized content when it receives a valid notice and suspends accounts of people with repeated violations. Facebook also said it is exploring news ways to help protect content owners. Green noted in his post, however, that because it isn’t possible to search for videos on Facebook, it is difficult for creators to track when their content is being freebooted. He also said that the fact that Facebook’s algorithm favors videos uploaded natively leads to more copyright violations.

In June, Facebook gave advertisers the option to choose to pay for a view once a video has played for 10 seconds. The company previously required advertisers to pay the instant a video ad, auto-play or not, came into view.

By comparison, YouTube has long offered marketers a product called TrueView under which they get charged only if a viewer doesn’t skip an ad—an option users have usually after four or five seconds—or if the viewer watches at least 30 seconds of the ad. Twitter charges advertisers for video views of three seconds or longer, but only when the video is completely visible in the user’s screen. Last year, Facebook’s share of the worldwide mobile advertising market was 17.4%, while Google’s share was 38.2% and Twitter’s was 2.5%, eMarketer said.

Follow me on Twitter @kchaykowski and e-mail me at kchaykowski@forbes.com.

Facebook Brings Autoplay, Better Targeting To Its Mobile Ad Network, Grows Its Marketing Foothold

Now With 2 Million Advertisers, Facebook Gains a Foothold With Small Businesses

Facebook now has 2 million advertisers, a milestone CEO Mark Zuckerberg announced today in a video post on the social network. Zuckerberg and COO Sheryl Sandberg thanked small-and-medium-sized businesses (SMBs) and entrepreneurs for jumping on board with the platform, helping it attract 500,000 new advertisers in the last year.

“Millions of businesses like yours are using Facebook to connect with their customers and reach the world,” Sandberg remarked in the clip.

Just a few years ago, Facebook was an unknown quantity when it came to local advertising for SMBs—the platform was perceived to be more for direct e-commerce players and big brands. That small-business challenge appears to have been met.

“What does stand out here is that Facebook is making it easier to advertise, particularly for small- and medium-sized businesses,” said Rebecca Lieb, a Facebook analyst. “Much like search engines developed tools 10 years ago to serve targeted ads, Facebook is doing the same and removing a lot of friction for these businesses.”

Reaching 2 million advertisers is yet another indication of Facebook’s growing dominance in digital, getting more businesses to market to its 1.4 billion users. The social network is changing the face of digital advertising much the way search redefined the marketplace more than 10 years ago, according to Lieb and other industry watchers.

Today, Facebook also launched a mobile app to help businesses manage marketing campaigns. And it’s these types of “turn-key” products for small businesses, which are often less socially savvy, that are making it possible to advertise on Facebook, Lieb said.

“Targeting, segmenting, day-parting—this is not their core competency,” she said, referring to the thousands of small businesses that have to learn a whole new marketing language for the social network. “Facebook has to go into local markets and show them this is how you as local advertisers leverage the platform.”

The fact is that to reach fans on Facebook, big brands and small businesses have to pay for promoted posts. There is no such thing as free reach, according to Jordan Kretchmer, CEO of social marketing software firm Livefyre.

“Facebook has become one of the best paid media channels out there,” Kretchmer said. The social network is developing the ads, the networks, the tools and data collection capabilities that hold promise for marketers to reach consumers in the most targeted way possible, online and via mobile devices.

However, its total control also creates the risk that businesses will become overly reliant on Facebook to reach audiences.

Big brands have already reacted to Facebook’s dominance by investing in their own data and audiences, like Taco Bell building an app last year to own access to its user base, Kretchmer said. “If Facebook changes something tomorrow, these brands can jump away from it and not miss a beat,” he said. “Small businesses are at a disadvantage. They are beholden to pay Facebook to drive traffic.”

Last quarter, Facebook ad revenue was $3.6 billion, an increase of almost 60 percent year over year. It is the No. 2 digital ad business, still far behind Google, but comfortably ahead of companies like Twitter and Yahoo.

Of course, it also has rivals like Snapchat, coming up today much like Facebook was 10 years ago. That’s why Facebook bought Instagram and WhatsApp, which have more than a billion users combined.

“Marketers flock to media that collects the most users, that’s just how it is,” said Nate Elliott, a Forrester researcher. So Facebook’s size is drawing the biggest brands, which are having the most success at the moment marketing there, he said.

The large companies have the advantage because they have their own data, and Facebook can be stingy when it comes to sharing its data.

“It’s perverse. Facebook knows more about customers than anyone ever, yet marketers are forced to bring their own data to the party,” Elliott said.

Marketing experts said the data question is the next one Facebook has to address with small businesses. Kretchmer said companies like his Livefyre are developing ad-targeting and data tools that have only been accessible to large brands so far.

“Getting to relevancy is more difficult for smaller businesses than larger ones,” said Debra Aho Williamson, eMarketer’s principal analyst. “For one thing, they don’t tend to come into Facebook with their own large data sets, as do many of the larger companies that advertise on Facebook. This presents an opportunity for Facebook to educate small businesses about the best way to create and target ads to achieve relevancy.”

Now With 2 Million Advertisers, Facebook Gains a Foothold With Small Businesses