Twitter Sales Double That of Facebook for US Mobile Advertising

Recently eMarketerer reported that Twitter's 2012 mobile ad revenue was nearly double that of Facebook — $123M vs $73M. This may surprise you at first, as it did us, but there are several reasons for this reality:

• Facebook just only rolled out mobile ads for the first time this year. In fact, Facebook opened its mobile-only ad unit and product in June. Before that, Facebook's only mobile product was Sponsored Stories, which was released in January 2011.
• Twitter's main display ad product — Promoted Tweets — is akin to search advertising. Promoted Tweets targeted to search terms appear at the top of the results page, like a search on Google. Facebook, on the other hand, relies on demographic and behavioral targeting, and less direct way to discern the interests of the Internet user.
• Mobile ad revenue is a very small number of Facebook's total revenue, which is projected to earn $5B in 2012. Compare this to Twitter's mobile vs. desktop revenue, which generates more advertising revenue from its mobile platform than from its website on many days in the last quarter of 2012, according to Twitter CEO Dick Costolo.

Currently, Google is projected to take home the lion's share of mobile ad dollars, raking in 55% of the estimated $2.6B on the table. This is mostly due to the fact that Google controls 95% of the largest format for mobile ads — search. Pandora is a distance second for mobile ad dollars at 8.7%. Within 2 years, however, it is estimated that the space will nearly triple in size to $6.6B, with Facebook in second at $629M.

The take home message to advertisers is as follows:

• You can't beat the performance of search display advertising on mobile devices. If you have some coin and want to experiment with mobile advertising, you will probably want to spend it here first.
• Of display ads, Rich-media is the highest grossing ad type. As the mobile device displays increase in size, such as the iPhone 5's increase to 4", the more likely this will remain true.
• Bet on Facebook for mobile display advertising. Facebook CEO Zuckerberg recently stated that they are "double down" on mobile. When $5B in revenue and 1B in world-wide users, most of whom visit with a mobile device, says something like that, maybe we should listen?