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Facebook tests mobile ads

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The next step for Facebook

Facebook has confirmed that it is currently beta testing its own mobile ad network.

The social network revealed yesterday it is running a ‘small test’, where the user’s Facebook data is used to display targeted banner and interstitial ads on third party apps and mobile websites. Unlike other ad networks that use cookies to target ads, Facebook’s network can access any demographic data on the user’s profile, as well as their Likes and any apps they have linked to their Facebook account. The ads therefore provide a higher degree of targeting, but can only be displayed when the user is logged in.

Facebook has long been expected to try new ways of monetising its mobile users, but the decision to become a ‘network’ and display ads on third party apps and sites instead of within its own app is wise. Josh Constine at TechCrunch commented, “If you were looking for a big new way Facebook could make money but avoid hurting its user experience, here it is.”

Turning the tide

A Facebook spokesperson revealed they had already been testing similar ads on Zynga.com for several months. The mobile ad network could therefore be a test for a bigger project, to rival the Google display network.

The mobile ad network could be an attempt at turning the tide for the company, following a slump in the value of Facebook shares to just $17.55. There was a jump in value following Zuckerberg appearing at a conference in San Francisco last week, while yesterday’s revelations pushed shares up to $21.87.

Natalie Booth, online marketing manager at theEword, said: “Facebook’s mobile presence has always been seen as a stumbling block, as there would have to be a compromise between ads and user experience within the app. If the company launches a display ad network, they will of course bypass this, and furthermore there will be a lot of advertisers willing to pay big money to use Facebook’s data.”

Written by rachel_hand_swapRachel Hand

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