This is a guest post from Nick Talarico, the Founder and CEO of 12 Gigs, a social-mobile casino gaming engine network.
In Q4 of 2013, Facebook will reach a tipping where they’ll make more than half their revenues via mobile ad sales.
Whenever anyone discusses why Facebook is so powerful, they list all the targeting and segmenting capabilities – which are all great.
But a lot of people are forgetting one key point as to why traffic that comes in through FB mobile ads is higher quality: they’re mobile ads being shown to monetizing users.
What do I mean?
With the explosion of free-to-play gaming apps, in-app purchase revenue becomes highly important, and thus guarded by app developers. What any app developer worth their salt will do is segment out their monetizing users from those who they haven’t made money from.
The rough rule of thumb is that somewhere between 2% and 5% of users of free-to-play apps will actually monetize. And only 1 in 1000 are true whales (repeat buyers at high pricepoints).
So that leaves up to 98% of your audience that is “un-monetizable” through in-app purchases (For this set of users, display ads have crept back into the industry as a very viable form of monetizing)
And for the group of those high-quality users, they won’t show them ads at all. Developers that segment users in this way are (a) making sure not to distract people who spend money, and (b) making sure not to risk losing that user to a competitive app.
And as a result, the quality of users you can buy through ads that are running on your competitors apps isn’t always great; the spenders are segmented out.
So how does this apply to Facebook? On Facebook, developers can NOT segment out their monetizers when the ads are being run on Facebook.
And therefore on Facebook Mobile now, that segment of spenders who never see ads in the games they play (and spend on) are now, are actually seeing ads.
If you’re a mobile developer with a smaller or larger budget, you should probably be experimenting with Facebook ads. Being able to access these high-quality users as an App Developer is all the more reason to