Facebook CEO Mark Zuckerberg said on today’s first quarter earnings call that mobile app install ads were “one of most important new ad products” the company offers.
COO Sheryl Sandberg pointed out that 3,800 developers used the product to drive a total of 25 million app downloads in the App Store and Google Play. Forty percent of the 100 top-grossing apps for Android and iPhone have advertised on Facebook, Sandberg said.
CFO David Ebersman said that mobile app install ads actually lead to a lot of incremental revenue, as many of these developers are newly spending on the Facebook platform, not just reallocating existing budget to a newer format.
In Q1 2013, revenue from advertising was $1.25 billion, and mobile advertising revenue represented nearly 30 percent of that. A large portion of mobile ads have been this app install format, which does not have a desktop equivalent. Zuckerberg said that this ad type are high quality additions to the feed because users are interested in learning about new apps but there aren’t great experiences for discovering them through the traditional app stores.
“A lot is just good content that people are interested in,” he said of mobile app install ads.
Zuckerberg noted that apps are important to more than just the traditional types of developers people might think of. Although many of the recent app install ads have been for games, travel apps and financial services — and Sandberg says its prices are competitive with other offerings for these industries — there are even more brands, retailers and other kinds of companies that are getting into app development and will start to want to drive users to an app experience, such as a storefront.
Facebook Strategic Preferred Marketing Developer AdParlor shared the following chart of average cost per 1,000 impressions and click through rate of mobile app install ads over the past few months.