Vesta Digital Blog

How Facebook Advertising is Boosting Revenue

Posted on: August 4, 2010

With over 500 million users, Facebook continues to monopolize the social media industry. The social media network is raking in billions as advertisers and businesses alike invest more in social media marketing via Facebook.

According to a Bloomberg article discussing Facebook Advertisers and spending increases, Facebook’s biggest advertisers have boosted spending by at least 10-fold in the past year. Facebook has reportedly maintained advertising prices even as the site’s potential continues to grow.

Sheryl Sandberg, Facebook Chief Operating Officer said in an interview:

“Two years ago, the big brands were experimenting with us…they started buying with us a year ago. Now, they’re going big.”

Facebook sales have increased from $700 million to $800 million last year, according to the article.

Facebook Growth

Chief Executive Officer of Facebook, Mark Zuckerberg, as announced that the social media site may delay an initial public offering until 2010 to allow the site to grow and stabilize.

Vaughan Smith, director of corporate development for the site, told Bloomberg reporter Brian Womack:

“As we get bigger and our platform gets more stable, I fully expect that we will be doing more significant acquisitions…this is working for us, and it’s working for the people that we’re acquiring.”

Facebook, with more than 1,400 employees, is continuing to acquire both small and large companies that use virtual currencies and mobile social media. Facebook has made five acquisitions so far this year, according to the article.

Display Ads

The article also reported that a significant portion of Facebook’s ad increase is stemmed from display ads, or the ad boxes that appear on the sidebars of Facebook pages, as opposed to search-related ads.

According to EMarketer inc., display advertising is expected to increase 13% to $8.56 billion in the US this year. Social Media Platforms are a great way to expand on the increase in the industry that is to come.

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