Facebook shocked the advertising and media industry a few days ago by stating that it would be shelving its mobile ad network experiment.
With the promise of everything mobile becoming the golden child for the Internet industry, it seems that mobile can do no wrong. Yet, the mobile promise seems to be falling short, as-is, for in-app advertising. Facebook's withdrawal may be a symbol of this disappointment that could lead to other media companies changing their game plan when it comes to app revenue.
Perhaps those most affected will be free apps that seek to do business using banner ads.
Facebook addressing their change in strategy for in-app advertising said:
"We are pausing our mobile ads test off of Facebook. While the results we have seen and the feedback from partners has been positive, our focus is on scaling ads in mobile news feed before ads off of Facebook," said the statement. "We have learned a lot from this test that will be useful in the future."
At the core of concern for in-app display ads is trying to understand the value of an in-app ad impression versus a normal ad impression. This does not mean that advertising does not work for mobile. Mobile is a powerful force for marketers and advertisers, and with a clear call-to-action of location and click-to-call, mobile is only gaining strength and support within the marketing community. Nor do we feel that this means advertising cannot work within the mobile app environment.
Specifically, the current trouble with in-app display is two-fold: 1. establishing the value of a display ad impression in-app and 2. the follow-through action being a click to an external website does not produce significant value. If in-app display advertising is going to gain significant momentum, it will need to better integrate with the user-experience of the device--the form and function it will take must better express the user behavior of the app and better articulate the advertising message within the confines of that desired user-behavior.
