Facebook To Target Mobile Ads Based On App Usage

Facebook (NASDAQ:FB) is reportedly working on a new type of mobile ad unit which would target users based on their mobile app usage patterns. Many popular mobile apps use Facebook Connect to quickly attract users and improve engagement by using Facebook’s inherent social integration. Facebook Connect enables users to quickly use any app without the need for signing up for each separately. ^[1]

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With the new mobile ad unit, Facebook plans to target ads at users based on their app usage data using Facebook Connect. This could be a potentially lucrative revenue stream as Facebook could serve up ads for apps and drive downloads by using data for each user and suggesting apps and other products based on a user’s interest, as indicated by the kind of apps and games they use.

With the mobile app economy set to further explode in coming years, Facebook could be looking at a potential gold mine. This could be one of the many ways in which Facebook can monetize its rapidly expanding mobile user base, which has been a concern that led to a drop in its stock price following the IPO. It would also tie in nicely with the recently launched Facebook App Center.

We currently have a $33 Trefis price estimate for Facebook, which stands just above its market price.

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1. Facebook to Target Ads Based on App Usage, WSJ [↩]