Facebook Inc. (NASDAQ:FB)’s video ad inventory is increasing, giving a lot of room to its revenue to expand further. A Facebook executive said that the social network’s 1.7 billion global users are awash in videos playing in their news feeds, and this innovation is spawning an enormous amount of advertising inventory, notes The Street.
More potential to earn from video ad sales
Facebook has an amazingly high amount of content that it can sell against ads, said Facebook’s vice president of product management, Adam Mosseri, when sharing new data on the final day of the TechCrunch Disrupt conference in San Francisco on Wednesday.
Mosseri said it is hypothetically possible for a user to watch 2,000 new videos per day on the site if they choose. This number is curated by the software based on their prior viewing habits and other online behaviors. Despite that, users see only one-tenth of that inventory or 200 in their average daily experience of 45 minutes, he added.
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Users do not see 90% of the video ads they are served at one time, but despite that, Facebook is generating revenue. This means a lot of runway exists in the market for digital ads, provided it gets product development right, notes The Street. Expectations are that Facebook will see a rise of 51% in its revenue this year, and Wall Street analysts predict it will grow another 35% in 2017. The company saw a 44% rise in sales last year.
Mosseri said Facebook’s software has to adapt to different user experiences due to the fact that it operates around the globe. He added that the result of not executing it well could be a poor user experience.
Facebook promises more support for publishers
The social networking giant intends on making its platform more attractive to publishers, for which it is making several moves. The first and foremost is Instant Articles. Over the last 18 months, Instant Articles publishers in the U.S. and Canada have seen a rise of 25% in the number of articles being read on Facebook, says Business Insider.
Also Facebook is launching new formats to enhance monetization. Instant Articles will support larger ad units in the coming months, allowing publishers to streamline ad units across their properties on mobile and desktop. Additionally, the company has started offering support to video and carousel ads for publishers that use Facebook’s Audience Network within Instant Articles, says BI.