Boston, MA 03/01/2013 (wallstreetpr) – Facebook Inc (NASDAQ:FB) currently has 1.1 billion users and that is not enough. In expansion mode, the micro-blogging site is head-butting its way into a new business that is calling “Facebook Exchange”. Marketers can study the users surfing habits, buy advertisements accordingly in real-time and post them within seconds. As the user browses through links on the site the relevant ad shows up on pages that are being looked at. This automated ad buying service that has been launched by Facebook Inc (NASDAQ:FB) is now 5 months old and already has over 1,300 customers said Sheryl Sandberg the company Chief Operating Officer. It plans on widening its global reach by expanding into Latin America and Asia.
Skimming user surfing-habits
Till now a large percent of the Facebook Inc (NASDAQ:FB) business had been relying on ads that skimmed information from user profiles. Now Facebook Exchange offers marketers the opportunity to target customers based on their surfing habits. So a person who visits travel websites will see travel-related ads while they are surfing Facebook. This kind of advertising and marketing is ok till the point that consumers don’t retaliate as cookies from their browsing history are tracked. Consumers are becoming increasingly aware of their rights and online privacy has come under the scanner in many instances.
A newbie in an old game
This kind of advertising is known as internet-display advertising and is not an unknown or novel concept. Facebook Inc (NASDAQ:FB)’s arch rivals Google Inc (NASDAQ:GOOG) and Yahoo! Inc (NASDAQ:YHOO) have been using this marketing tactic for over a decade now and the company thinks that any risks that it takes with launching new services in the field will be worth it. Analysts have predicted revenue growth to slow down upto 31 percent in this year from the 37 percent that it was in 2012. This year 7 percent of the total revenue is expected to come in from Facebook exchange with it expecting to generate sales worth $460 million.
Making the exchange work
Facebook Inc (NASDAQ:FB) slumped to a stock rally low of 52 percent in November and CEO Mark Zuckerberg is using some other ad services and the Facebook Exchange to accelerate growth and keep its stock rally ticking. The exchange venture is forecasted to generate sales of $460 million this year and aims at catching up with
Google Inc (NASDAQ:GOOG) which at $15 billion is the leading player in the American display-advertising market. Analysts have stated that the exchange is progressing well and that it has the potential to make a meaningful contribution to the company’s current revenue acceleration efforts.
Rooting for exchange
The head of Facebook Inc (NASDAQ:FB) ad products Gokul Rajaram stated in an interview that he was on the lookout for new ways to boost the company revenue and that the idea of an exchange had been put forth by a team member, Antonio Garcia-Martinez. Facebook users spend 23 percent of their time on the site via mobile devices and 11 percent is via desktop computers. The service is built in such a way that user identities remain anonymous and that no personal data is shared with marketers who post their ads on the exchange. Real-time bidding for ad space is expected to give Facebook Inc (NASDAQ:FB) the boost it very badly needs.
Shares of Facebook Inc (NASDAQ:FB) went up by 1.41% to close at $27.25
Shares of Google Inc (NASDAQ:GOOG) went up by 0.18% to close at $801.20
Shares of Yahoo! Inc (NASDAQ:YHOO) went up by 0.69% to close at $21.31
Shares of COMSCORE, Inc (NASDAQ:SCOR) went up 0.50% to close at $15.94
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