Although Advertising represents 85% of Facebook’s revenues, its story is much shorter than you may think.
In the first years of its life Facebook focused on the product and user growth, basically ignoring advertising which was sold directly only to big customers like Apple and Chase bank.
It was only in 2006, two years after it was born, that Facebook started to take advertising more seriously by signing a deal with Microsoft to have their online division manage advertising on Facebook.
In November 2007 Facebook started taking online marketers more seriously and released many updates to the platform which included: a first incarnation of “Facebook Ads”, pages for businesses and brands, insights to better understand a page audience, and other business-oriented features. However, this update did raise many privacy concerns and was highly criticized.
Fast forward another year and in December 2008 Facebook introduced the foundation of its current advertising offer: Engagement Ads. This was a new type of advertising whose focus is not to directly sell a product, but to create dialogue with users on Facebook to promote pages of other Facebook entities. Back then advertising was still targeted to big advertisers and small businesses had a hard time accessing it.
This changed in 2009 when Facebook launched Self Service advertisements for pages and events. Now everyone could easily buy Facebook Ads with a credit card. This happened only three years ago!
Since then Facebook has kept updating its advertising offer continuously to give businesses a great platform to promote on. They introduced better targeting that now allows you to specify in a very granular way who should see your Ads. They introduced many new advertising formats to cover both the promotion of external web sites and promote Facebook pages.
They’ve also opened Ads API that allows third party developers like us to create great products to better manage and optimize Facebook Advertising.
Nowadays, Facebook is working hard to improve advertising for their mobile users, who now account for nearly half of their traffic. These efforts have lead to advertising inside the newsfeed and new formats specifically designed to promote the download of mobile applications on both Android and iOs devices.
It’s been a long journey, which created a 5 billion dollar business in 2012. Today Facebook Advertising is a great platform for both big brands and small to medium businesses to create brand awareness, generate demand for their products, and drive sales to their stores both online and offline.