Facebook currently operates on an ad-supported business model. The main challenge to this has been proving a successful conversion rate from online adverts to meaningful sales for marketing investors. As a means to begin addressing the issue of allowing for a more targeted advertising approach and so higher sales conversions, Facebook has introduced Custom Audiences and more recently Graph Search.
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Facebook currently operates on an ad-supported business model which has proved moderately successful, with the company deriving 82% of its revenue from online advertising.
The Facebook mobile application is soaring in popularity with growing monthly active users, however with a significantly lower level of display advertising available on mobile devices this generates less advertising revenue per page than desktop devices.
Your key questions answered
Is the ad-supported business model a viable strategy for future growth for Facebook
How will the introduction of Graph Search influence Facebook's revenue stream