Last month I discussed how Facebook (FB) shares were on a downward slope after it announced its new “Graph Search” feature. Mainly because investors didn’t see a way to monetize it.
The biggest issue is that advertisers don’t know that people want the product they’re writing about on Facebook.
Max Wolff, Senior Research Analyst, Greencrest Capital, says that’s what makes Google (GOOG) so successful on this front: “Search is huge for delivery ads. The reason Google is, in terms of revenue, much more successful… is we know there is intent. So when later on today you go and you look up Prada (PRDSY) handbags, I know that you are probably in the market for a Prada handbag.”
Indeed, making money on mobile advertising will make or break Facebook this year.
As Louis Basenese asked last month, “Will Facebook shine in 2013? Not if it doesn’t figure out how to massively monetize its user base via mobile advertising. And that’s a big ‘if.’”