Facebook’s (FB) Latest Stab at Monetization Could Payoff Big Time
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Rating Summary:
46 Buy, 17 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 15 | Down: 12 | New: 12
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According to reports Facebook (Nasdaq: FB) is testing a new mobile ad network that may help the company monetize users. The plan works by linking Facebook users to separate mobile apps and sites containing ads. The program is called the Facebook Ad Network, and would put Facebook head to head against Google’s AdSense.
Anyone currently logged into Facebook who visits real estate outside Facebook would be shown ads targeted by their Facebook information, such as age, gender, interests, etc. Facebook and the site hosting the ad would then split the money made on clicks or impressions.
“Facebook has approached mobile advertising conservatively, in our view, for fear of alienating users,” said analysts Colin Sebastian of Baird Equity Research. “By shifting monetization to ads on other sites, Facebook can still leverage its unique data and reach, while reducing its dependence on ads displayed on its own sites.”
Many view the report as another signal that Facebook is moving more aggressively to improve user monetization. Google is the largest online advertising platform partly due to strength and relevance of AdSense. Similarly, Baird views Facebook as positioned to leverage unique user profile data to allow advertisers to serve targeted ads across the web.
For example, a Facebook user with an expressed interest in aerobics might see an ad displayed on a news site for a sports drink "liked" by a Facebook connection.
“Importantly, Facebook generates no revenues today outside of its own sites, which understates the company's potential in the $15 billion display ad market”, said Sebastian, noting that one of the most significant growth opportunities for the company is to extend its data-rich ad platform to third-party websites.
Baird has an Outperform rating on Facebook (NASDAQ: FB) and a price target of $37.00.
For an analyst ratings summary and ratings history on Facebook click here. For more ratings news on Facebook click here.
Shares of Facebook closed at $21.87 yesterday.
Anyone currently logged into Facebook who visits real estate outside Facebook would be shown ads targeted by their Facebook information, such as age, gender, interests, etc. Facebook and the site hosting the ad would then split the money made on clicks or impressions.
“Facebook has approached mobile advertising conservatively, in our view, for fear of alienating users,” said analysts Colin Sebastian of Baird Equity Research. “By shifting monetization to ads on other sites, Facebook can still leverage its unique data and reach, while reducing its dependence on ads displayed on its own sites.”
Many view the report as another signal that Facebook is moving more aggressively to improve user monetization. Google is the largest online advertising platform partly due to strength and relevance of AdSense. Similarly, Baird views Facebook as positioned to leverage unique user profile data to allow advertisers to serve targeted ads across the web.
For example, a Facebook user with an expressed interest in aerobics might see an ad displayed on a news site for a sports drink "liked" by a Facebook connection.
“Importantly, Facebook generates no revenues today outside of its own sites, which understates the company's potential in the $15 billion display ad market”, said Sebastian, noting that one of the most significant growth opportunities for the company is to extend its data-rich ad platform to third-party websites.
Baird has an Outperform rating on Facebook (NASDAQ: FB) and a price target of $37.00.
For an analyst ratings summary and ratings history on Facebook click here. For more ratings news on Facebook click here.
Shares of Facebook closed at $21.87 yesterday.
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