Subscribe / Unsubscribe Enewsletters | Login | Register

Pencil Banner

Ads in Messenger could be Facebook's next big thing

Matt Kapko | Feb. 22, 2016
Facebook is reportedly readying a new user-initiated advertising medium within its popular Messenger app that could reshape the ad industry.


CEO Mark Zuckerberg explains plans for Facebook Messenger at the company's F8 conference in March. Credit: Robert Galbraith/Reuters

Facebook is reportedly planning a massive new business initiative that could eventually drive billions of dollars in advertising revenue. During the first half of this year, the company plans to sell ads within its Messenger application, which has 800 million monthly active users (MAU), according to TechCrunch

Such a move wouldn't be the first time Facebook sold ads outside of its core social networking app, but it would represent the largest audience (outside of the Facebook app's user base) that the company has made available to advertisers. Facebook has consistently increased the number of ads shown in Instagram, a visual social network with 400 million MAUs, during the last year, and it sells automated in-app mobile video and display ads to publishers via its LiveRail platform.

In October, Facebook COO Sheryl Sandberg said the company was in the "very early experimentation stage" of placing ads in Messenger, when she spoke about the effort during the Advertising Week conference in New York. However, Facebook declined to comment on TechCrunch's recent report.

Messenger ads would give marketers a new channel to create more personalized relationships between companies and consumers, but the ads could also represent a challenge for Facebook, according to Amber Whiteman, vice president of digital marketing agency Metia. "If the advertisers don't take advantage of the unique medium and tailor their ads specifically, it could easily fail and consumers won't be as receptive to another platform trying something similar in the future," she says. 

The context in which ad are shown in Messenger would largely determine how users react to them, according to Seth Shafer, research analyst at SNL Kagan. "While there might be backlash to ads showing up on personal messages, users might react differently to an offer from Uber for 20 percent off their next ride if they'd previously used Messenger to book an Uber ride." 

Users, not brands, would initiate Messenger ads

Facebook will allow businesses to send ads in the form of messages only to users who previously communicated with the companies on Messenger, according to a document obtained by TechCrunch. Users would have to contact businesses directly on Messenger before the companies could send them ads, according to the TechCrunch report.

"This new platform is unique in that it is choice-driven," Whiteman says. "Allowing Facebook users to initiate the conversation in the first place makes them much more receptive to the ads once they engage."

Snapchat's approach to advertising could be a "potential analog to what Facebook might do with ads on Messenger," Shafer says. "Snapchat has been careful to only present ads outside of the core Snapchat service," such as video ads in Snapchat Discover and sponsored ad formats that display in other sections of the app.

 

1  2  Next Page 

Sign up for CIO Asia eNewsletters.