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Facebook Has Advertising Problems? You Don’t Say!

Gokul Rajaram, the man who operates Facebook’s crucial ad-based revenue stream, happens to be unusually forthcoming when discussing the challenges facing the company as its team tries to make enough money to satisfy all those sweaty investors.

In a telling recent interview with AdExchanger, he outlined the seven biggest challenges that social media’s top dog must address.

In summary:

  • Facebook owns a whole lot of invaluable data from hundreds of millions of users—but the company’s not sure what to do with it. Do they plan to use it? “Not at this time.” Hmm.
  • Despite the much-touted value of “free” Facebook pages, most marketers have to buy sponsored posts in order to reach any kind of significant audience because every user’s news feed is so crowded.
  • The company’s mobile app leaves a bit to be desired—for personal users and businesses. The company’s refusal to use banner ads continues to frustrate marketers who want their messages to be completely unavoidable, and this fact is compounded by tiny graphics.
  • Facebook Offers? Anyone? Bueller?
  • The company is changing too quickly for its own good: Facebook’s biggest ad partners, known as “preferred marketing developers”, struggle to keep up with all the new products.
  • Video drives a hell of a lot more revenue than text and visuals alone (sorry, copywriters). Is Facebook moving to integrate video ads into its existing model? Nope. (More than a little surprising, right?)

We certainly appreciate Rajaram’s honesty, but these points are slightly disconcerting, and they’d be even more so if we currently owned Facebook stock. What do these challenges mean for the future of the company? How can they put a more positive spin on their all-important advertising efforts, especially when they’ve had such a challenging quarter from a PR perspective?

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