INside Performance Marketing
Facebook Sees Increase in Ad Revenue, Ramps up Video Focus
Image Credit  Maurizio Pesce Creative Commons license

Facebook Sees Increase in Ad Revenue, Ramps up Video Focus

Facebook has released its Q1 2015 stats, revealing a healthy rise in ad revenue and increased efforts in optimising video on its platform.

For Q1 this year, revenue from advertising saw a 46% increase from Q1 2014, reaching $3.32 billion. This figure would have increased by 55% had year-over-year changes in foreign exchange rate been excluded.

Also triumphant, mobile advertising revenue made up 73% of advertising revenue for the first quarter of the year, a significant increase from 59% in Q1 2014.  

Always keen to stay ahead of the game, Facebook has sharpened its focus on video advertising of late. The company has reported it now averages more than 4 billion video views a day, up from around 1 billion a day last summer. Most of those views, Facebook says, are on mobile devices.

“Facebook's results show how its increasing emphasis on video is starting to pay off, as the social giant bids for a greater share of the fastest growing digital ad spend category, “ says Justin Taylor, UK MD at video ad company Teads.

Colossal reach

Due to the fact that Facebook does not publish its video advertising revenues, it is hard to say for sure if the platform poses a significant threat to TV ad budgets or YouTube.

Nevertheless, Taylor believes Facebook’s focus on the realm of video has already been justified.

“It’s clearly a compelling argument for many, with Facebook now pushing video above all other content and serving more than 4 billion spots to users daily.”

However, Taylor points out, naturally, advertisers only want to pay for people who actually watch their videos and by charging advertisers for just 3 seconds of viewing, Facebook could run into difficulties.

“Brands will also have to decide whether the platform’s colossal reach trumps the risk of their messages appearing alongside inappropriate content,” states Taylor.

“That's why many clients are combining social campaigns with video ad spots on the sites of premium publishers. The introduction of outstream video ad formats is opening up vast swathes of new premium inventory on these sites to fulfil demand and they will continue to be a popular choice for brands seeking both scale and safety.”

Relaxing the rules

Ahead of its Q1 announcement, Facebook announced changes to its News Feed on Tuesday, which the company says may affect referral traffic for publishers.

Previously, Facebook prevented users from seeing multiple posts from the same source in a row. With this update, the company have stated they are “relaxing” this rule.

Facebook has also said it will aim to ensure that content posted directly from close friends, “including photos, videos, status updates or links”, will be higher up in News Feed so users are less likely to miss it.

Interaction with posts on pages will contribute to the change in content seen on the News Feed, as Facebook attempts to personalise content to individual users.

Stories about friends liking or commenting on a post, which have proved unpopular with users, will appear further down the News Feed if at all.

Adele MacGregor

Adele MacGregor

Adele works as a news and features reporter for Existem, covering the latest updates from the performance marketing industry. Adele has written for Media Wales, Grazia Magazine and publications in Spain and the US, with topics ranging from social media and digital skills to local music and gymnastics.

Read more from Adele

Join over 10,000 performance marketers for the ultimate weekly update on industry news