The current state of Facebook ad networks

Guest Post by Sundeep Ahuja

Though the early Facebook application M&A going on is exciting and potentially lucrative for those developers who can build and cash out quickly, more sustainable mechanisms for monetization are quickly becoming the central drivers of application development. In this short post I’m going to take a look at options developers currently have to monetize their apps via ad networks. Although several advertising/referral/affiliate networks have already launched to serve Facebook application developers, there is still tremendous opportunity for improvement.

Selling installations: Slide, RockYou, and SocialMedia
The widget kings RockYou and Slide, along with newcomer SocialMedia, have assembled ad networks that leverage their suite of popular applications and distribution strength. With these networks, you can promote other applications on your app and advertise your application throughout their networks. CPI, or cost-per-install (basically CPA), is an interesting monetization option with these networks. By embedding a code snippet in your app, they can track which apps in their network are generating installations of yours (a yet-to-launch company called Adonomics will be doing this as well).

Starting to target: Lookery, Cubics, appfuel
These new firms are dedicated Facebook ad networks with an intelligent twist. Lookery is offering branded content on a CPM basis with basic targeting starting last week. Cubics claims precise demographic targeting for advertisers (something that Microsoft has yet to do well with its Facebook real estate). Yet to be launched appfuel (where I’m a co-founder*) is taking a contextual approach (a la Google AdSense).

Cross promotion networks: fbExchange, CanvasExchange
Both fbExchange and CanvasExchange are Facebook-grown application cross-promotion services, though I expect them both to offer branded and other promotional content to publishers very soon. For now, they’re better for marketing/promotion than monetization.

…And the rest
Then there are always the .com world widget options (UserPlane, AdSense, Azoogle, etc.), affiliate/CPA options (both direct affiliate programs like Amazon or iTunes, as well as networks like LinkExchange and NeverblueAds), video networks (though VideoEgg just launched EggNetwork to sell rich media placements), and of course, lead generation (Adteractive, Peanut Labs, etc.).

Can any developers speak for how well any of these options are working for you? Please comment below and join this Facebook group on monetizing applications.

*The appfuel network will officially be launching in alpha later this week.