Facebook aims to be a small business advertising juggernaut

More than 50 million small businesses have active Facebook pages, giving the company a unique opening to sell those firms ad products
Written by Stephanie Condon, Senior Writer

Facebook released a stellar earnings report on Wednesday, thanks to its robust ad revenue growth: The social media giant now boasts more than 3 million active advertisers, and ad revenue in the first quarter grew 57 percent.

"We remain focused on driving our clients' businesses, moving their products off shelves, both in stores and online," COO Sheryl Sandberg said on Wednesday's earnings call.

While Facebook clearly offers an attractive platform for advertisers, it's not the only option there -- the company is competing for advertising dollars with other Internet giants like Google, as well as firms like Pinterest and Twitter.

Where Facebook has a "core competitive advantage," Sandberg said Wednesday, is with small and medium-sized businesses (SMBs).

It's "prohibitively expensive" for many small businesses to reach people digitally, she said, claiming that 35 percent of small businesses in the U.S. don't have any web presence at all. While small business owners may not have the capabilities to set up their own mobile app, just about anyone can set up a Facebook page. In fact, more than 50 million small businesses do have Facebook pages that are active on a monthly basis, giving Facebook the easy opportunity to sell them ad products.

From there, the social media company can offer a variety of targeting tools and ad formats that allow businesses of any size to connect with consumers.

Sandberg gave the example of Sparkle in Pink, a Utah retail business that was able to increase sales by 9 percent a month with ad products like a slideshow ad that included a "shop now" button. "That shows how you can use our ad products to go all the way from awareness, measuring through to a sale and show how important our ads can be to commerce on our platform," Sandberg said.


The company continues to roll out ad products that are easily utilized by SMBs. This quarter, Facebook launched canvas ads, fast-loading immersive mobile ads that are easy to build. Facebook is also focused on building measurement tools into its ad products.

"We continue to be very bullish on this channel because we have such a broad base of usage," Sandberg said, "because that usage is so active, and because we're very focused on investing and simplifying our products so that all SMBs can use them."

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