Facebook Q4 2015 Earnings: Mobile Advertisers Saw This Coming
Published: January 28, 2016
Author: Molly McCarty
Facebook released its Q4 2015 earnings yesterday, and we are all impressed, but not surprised, at how strong performance for the social media giant is. Among the highlights of the earnings call was the revelation that 80% of Facebook’s advertising revenue is from mobile.
Although astounding, this number makes sense. To anyone who advertises on the network, it’s clear that Facebook has been putting the majority of its focus on growing mobile. Some of the major ad units that launched in the latter half of 2015 were clearly geared towards mobile.
Carousel ads, which launched in 2015, have seen quite a bit of success for clients at 3Q. We are seeing CPAs up to 55% lower than their equivalent standard single-image link post. Most of this performance is driven by mobile. We find that users are naturally swiping the images within the Facebook app. This increased engagement drives down our CPCs, and conversion rates have remained the same.
Lead ads also helped bring in the huge mobile growth. Lead ads initially launched as a mobile-only ad unit. The ad unit itself allows users to submit information (name, birthdate, age, etc.) seamlessly, without having to leave the app. Since the launch of lead ads, we have seen extremely strong cost/lead numbers come through in almost every account that has attempted to run lead ads. This has led to even more budget being pushed towards Facebook mobile.
When we look at Facebook advertising revenue as a whole, we see a 57% year over year growth, bringing total revenue from advertising to $5.6 billion. This rapid growth indicates that Facebook is going to be a (if not the most) powerful force in the advertising world for years to come – and that it’s going to be on the back of mobile.
My predictions for the earnings call a year from now? Nobody can predict results that so far outpace experts’ projections, but we’ll be talking about mobile performance (possibly mobile video performance) and calling out some of the new ad types and advanced targeting pushing those numbers.