Facebook vs. Twitter, Who Has Edge in Mobile Ad Wars?
CNBC Media and Entertainment Reporter
A duo of reports out Thursday said Facebook's ads are working, but mobile still has a ways to go.
A survey from Capstone Investments, finds Facebook ads are generating improving return on investment for advertisers "that could lead to increased spend on the platform."
The firm's survey of several large advertisers about campaigns on the site in July and August found that sponsored story ads "significantly outperformed other inventory," with a 1.2 percent click through rate. (Read More: Facebook's Challenge - Getting Users to Click on Ads.)
The question for Facebook is of course how its mobile ad business is going: Capstone finds that the click through rate was three to four times that of regular Internet ads run during the campaigns. The bad news — less than 10 percent of the campaigns investment was allocated to mobile, which means Facebook still has a ways to go in terms of delivering more mobile ads. (Read More: Inside Social Media's Black Market.)
The fact that Facebook has been slow to ramp its mobile ads — just introducing them this spring — is one reason Twitter will surpass Facebook in terms of mobile ad revenue in 2012. A new forecast from eMarketer finds Twitter will earn $129.7 million in mobile ad revenue, while Facebook will bring in just over half that amount, at $72.7 million in the US. But what's most remarkable about these numbers is how much smaller both of them are than Google , with $1.42 billion in mobile ad revenues, and even Pandora , with $226 million. Google's massive advantage comes from its ad network, the fact that it delivers mobile ads across many sites. (Read More: Pandora Well Positioned for Mobile Growth - CEO.)
eMarketer does see Facebook's mobile revenue surpassing Twitter's next year, projecting that the social network will generate nearly $400 million in mobile ads next year, surpassing Twitter. And in 2014 eMarketer says Facebook will become the second largest mobile ad provider, after only Google, with nearly $630 million in mobile ad revenue.
We'll see if Facebook moves into Google's territory and launches an ad network to grow even faster. (Read More: 'Tremendous Opportunity' in Facebook - Bob Peck.)
-By CNBC's Julia Boorstin
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