Facebook has a great user engagement model but has lacked to monetize the same despite several big attempts in the past. Facebook’s new design includes a new look for News Feed that can be organized based on friends, photos, music, following, games and groups. One of Facebook’s biggest long-term drivers is to increase ad pricing through new ad formats.
The new look has a different left side bar, and more space in the center, allowing larger photos, like on Instagram. Users can select to view feeds on,
All Friends – a feed that shows the users everything their friends are sharing;
Photos – a feed with photos from friends and Pages that the users liked; From the Advertiser’s viewpoint, Facebook’s new design has larger photos, suggesting that ad sizes also could increase. Also, when advertisers buy feed ads that feature a photo, those photos will likely be larger as well. Major brands that are used to buying larger home-page takeover ads should like the redesign, and I think it should yield higher CPCs.
Music – a feed with posts about the music that the users listen to.
Following – a feed with the latest news from the Pages the users liked and the people that the users followed.
At this point it is difficult to estimate on the quantity of ads served (users may be better able to avoid ads), a better news feed user experience will likely increase engagement and increase overall monetization opportunities for Facebook.
Except Google, none have been able to monetize on the Internet meaningfully demonstrating solid QoQ Growth and striking a win-win equation for Publishers and Advertisers. Hopefully, facebook will see some traction with better news feed as user experience will likely increase engagement and increase overall monetization opportunities as larger news feed ads could yield higher click through rates and higher ad pricing with demand from newly introduced formats.