How Asia Has Become The Fastest Ad Revenue Market For Facebook

Asia for the first time has become the fastest growing ad revenue market for Facebook. We look into how Facebook with its 3 major ad products cracked Asia

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Facebook has been focusing on emerging markets for quite some time with innovative ideas. But the challenge has been to spike up revenues from emerging countries. Last year ET reported that India market accounts for less than 0.1% of Facebook’s revenues.

One of the primary reasons why Facebook has performed badly on the revenues side is due to the country’s infrastructure. Although India has been an actively growing smartphone market in Asia, it is still dominated by feature phones, a market where Facebook’s targeted advanced advertising products fail to work.

However this is history, today overseas markets bring in more advertising revenue than the United States for Facebook Inc, amounting to 51 percent of global ad sales in the first quarter, with growth in Asia the fastest in the world at 57 percent, company executives told Reuters.

Total advertising revenue for the quarter increased 46 percent to $3.3 billion, the vast majority of Facebook’s $3.5 billion in quarterly revenue. Fifty-one percent of total ad revenue would be about $1.7 billion for international markets. International advertising revenue rose 36 percent from a year earlier, Facebook said.

Mobile advertising represents more than 70 percent of Facebook’s total ad revenue, and mobile is particularly strong and attractive to advertisers in emerging markets, Carolyn Everson, vice president, global marketing solutions at Facebook said.

The Asia Pacific region is ahead of developed countries and a focus for Facebook. Over the years, to overcome the problems of emerging markets, Facebook has introduced quite a few products that have sparked interest among advertisers.

Listed below are three such innovative products introduced by Facebook to tap the Asia Pacific region.

1. Facebook Lite

Earlier last week Facebook announced the launch of Facebook Lite, a new stripped down version of Facebook for Android that uses less data and works well across all network conditions.

Facebook Lite – an app less than 1MB includes core experiences like News Feed, status updates, photos, notifications and more. To begin with Facebook Lite has rolled out in Asia, and over the coming weeks it will be available in parts of Latin America, Africa and Europe.

Facebook has been chasing consumers in developing markets now for years and recently it was reported that Facebook Lite will give advertisers greater access to consumers in developing regions across Asia, especially in India and Indonesia.

A Facebook spokesperson confirmed to ClickZ that users would be able to see some ads on Facebook Lite. “But right now we’re focused on creating the best user experience, and will continue to improve the experience based on feedback we gather from people using Facebook Lite,” she said.

2. Missed call ads

Emerging markets are till date dominated by feature or basic phones and Facebook ads fail on such devices. To meet this challenge, Facebook last year introduced an ad product built around the missed call feature. “When a person sees an ad on Facebook they can place a “missed call” by clicking the ad from their mobile device. In the return call, the person receives valuable content, such as music, cricket scores or celebrity messages, alongside a brand message from the advertiser — all without using airtime or data,” said Facebook.

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Last year Facebook  tested the product with Gillete India to drive measurable awareness of its new Vector 3 razor among its target group in India. The campaign reached a target audience of more than 60%.

Prior to that Facebook executed a similar campaign for Garnier Men India in collaboration with ZipDial. With the objective to drive sales for Garnier Men India, Facebook created a click to missed call ad campaign for Garnier Men, in partnership with ZipDial, during IPL 7.

Clearly Facebook wants to monetize its feature phone user base. The journey started from last year when Facebook provided advertisers with the ability to place and target ads on feature phones. Since then, Facebook has improved ad delivery by optimizing for low-bandwidth connections and offered enhanced features that give brands more storytelling options.

Facebook is now planning to expand the ad feature to other emerging markets where roughly 7 out of every 10 people in countries like India, Brazil, Indonesia, Mexico, South Africa and Nigeria, use far simpler devices like feature phones to access the Internet.

3. Creative Accelerator Program

Earlier this year, Nestle Everyday for its Theater in a Cup campaign wanted to reach out to people in both metros and rural areas in India. Facebook worked with the brand and its agencies, Publicis Delhi and Media Alliance, to develop creative based on people’s bandwidth strengths and device types.

With Facebook’s ability to bandwidth targeting, people accessing Facebook with lower bandwidths on feature phones and low-end smartphones received still images from Nestle Everyday, and people with stronger bandwidth connections and more sophisticated devices received videos in News Feed.

Facebook Creative Accelerator Program

Facebook now informs that the campaign increased brand awareness by 9% and purchase intent by 5%. Facebook credits this to its Creative Accelerator program – a program designed to help brands unlock the power of personal storytelling in high-growth countries or emerging countries like India. Through the program, the Facebook Creative Shop has been working with seven clients and their agency partners in India, Indonesia, South Africa, Kenya and Turkey to bring brands’ stories to life.

Not just Nestle, Lifebouy used photos and videos showing its soap’s effectiveness on germs to talk to moms in Indonesia about how washing hands helps keep families healthy. After the campaign, 9.4% more moms in the area associated the brand with the statement “protects effectively from germs.”

Finding success with these initial campaigns, Facebook is now looking to scale the Creative Accelerator Program globally.

Bandwidth targeting that gives advertisers the ability to send ads based on the quality of a user’s network connection, moderating type of ad to whether a user is on a 2G, 3G or 4G / faster connection isn’t new technology for Facebook. With its latest launch of Creative Accelerator Facebook, it is not only sharing the knowledge to target developing markets but also creating campaigns, building creatives for the wide array of devices and mobile connections.

In short it has now built a business model around its  deep understanding about the emerging markets of Asia.