Will Facebook’s New Ad Exchange SOLVE Its Monetization Woes?
Facebook (NASDAQ:FB) has officially announced that its new ad-purchasing mechanism Facebook Exchange (FBX) is out of beta. Shares were up yesterday after CEO Mark Zuckerberg made his first media appearance since the IPO, and FBX looks like a strong second step toward turning investor doubt around.
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The exchange allows real-time bidding for advertisement space on Facebook. The only format supported through the exchange is the Facebook Standard Ad. Scott Shapiro, product marketing manager for Facebook Exchange, says this means advertisers “can really think of this as display.” With as much as 25 percent of online display ad inventory and 955 million users, that’s a huge amount of display space.
Marketers will have to use their own data and insight to target audiences. “Facebook Exchange is perfect when the objective is a conversation outside Facebook and the data used to drive that objective exists outside Facebook.” Attempts to monetize its user information in the past have largely failed.
With previous efforts like Sponsored Stories and Page Post Ads failing to be effective, Facebook Exchange could be the catalyst the stock needs. Some reports are already claiming that FBX is generating higher returns than other real-time bidding systems.
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