Mobile First, Second and Third

Carat TanyaLairdTanya Laird, mobile strategy director at Carat, explains why she feels Facebook’s Audience Network is shaking up the industry.

That Facebook is launching a mobile ad network is not a big surprise. However, the inevitability of the move should not lessen its significance to the market.

This decision does three hugely important things. It cements Facebook’s position as a mobile-first business (something it has obviously been aggressively moving towards when you take into account acquisitions such as WhatsApp). Secondly, it helps them make up ground on Google’s advertising offer (a long-term goal). And thirdly, it opens the door to the previously-neglected games developers (the main opportunity)

Behavioural targeting
Because of Facebook’s Social Graph, the social giant can now offer potentially more sophisticated behavioural targeting than Google. It also means it has a global network to realistically rival the search giant in the months to come.

It will now be able to take advantage of inherent behaviours in Facebook. Unlike Google, the main point of Facebook is to engage with people. This means consumers become more purposeful and more receptive to ads on Facebook than when they are simply searching for things on Google. Facebook also uses its data in a more meaningful way than Google, which means that consumers will ideally feel less intruded upon from the ads they are being served.

As always, however, there are warnings to be heeded to ensure Facebook does not wander down the road of becoming too intrusive – consumers will allow much more advertising on other devices, but on the highly personal mobile device, intrusiveness is a genuine risk. If users feel for one second it’s becoming a commercial arena where advertising is being constantly thrown at them, they are not going to stick around. But, as long as Facebook sticks to its guns about limiting frequency and keeping relevance, it will be a in a very strong position.

Independent games
While this is all positive news for Facebook, the power, profitability and scalability is in what it can do for the independent games industry. This is a very clever ploy by Zuckerberg to open a door that Facebook has previously not paid a significant amount of attention to. In the past, for many businesses, when it came to driving mobile gaming and app installs, Facebook has always been a challenge in both time and effectiveness, so it was generally not cost efficient for certain types of product and specifically for smaller studios.

For this reason there has never been a huge amount of interest from the smaller independent development studios in developing for Facebook, but with this additional revenue opportunity the playing field has now been opened up for them. By launching this ad network Facebook is saying to the games industry: “We haven’t forgotten you”.

Given the opportunity to leverage not just the Social Graph, but also, a massive advertising network, this is a new playground that people will be keen to explore. Small indies have already started showing an interest in publishing on Facebook, and this will open the door to many more. Facebook now has an opportunity to be a genuinely cost effective CPI acquisition channel against the likes of TV. This is a huge step change in its business model and future profits.

With this announcement, Facebook has firmly placed its cards on the table and they are mobile, mobile and mobile. It has also shaken up the industry in a way that might not seem obvious at first, but in actual fact, will have long-ranging repercussions.

Tanya Laird is mobile strategy director at Carat