Facebook Inc. is getting support from two big-name advertisers after tough questions over the effectiveness of its ads.
On Tuesday, Ford Motor Co. and Coca-Cola Co. separately said they found value in Facebook advertising and Ford plans to expand its use of the social network in advertising. The remarks amounted to major-player endorsements for Facebook's advertising business in the wake of the social network's disappointing initial public offering last month.
Ford's global sales and marketing vice president, Jim Farley, said the auto maker is deepening its use of social media, particularly on Facebook, to improve its image among potential buyers. ...
Facebook Looks to Bolster Payments BusinessFont size: A | A | A 4:48 PM ET 6/19/12 | Dow Jones By John Letzing
Facebook Inc. (FB) is seeking to strengthen the nonadvertising side of its business by enabling users around the world to make payments on the social site in local currency and letting application developers charge on a subscription basis.
Facebook, of Menlo Park, Calif., said on a company website Tuesday that enabling payments in local currency should make it easier for developers who might otherwise be penalized by a system pegged to the U.S. dollar reach international users.
In addition, starting next month developers will be able to start charging users on a subscription basis, enabling them to establish a "recurring revenue stream and offer updated content or premium experiences for a monthly fee," Facebook said.
Subscriptions would also provide recurring revenue for Facebook, which takes a 30% cut of payments made to developers of games and applications used on the site.
The moves announced Tuesday are designed to strengthen a relatively small, but important element of Facebook's business, which is still dominated by online advertising.
In the first quarter of this year, Facebook saw revenue from Payments and other fees rise 98% to $186 million, while advertising revenue rose 37% to $872 million.
The company's financial prospects have been under intense scrutiny since it went public last month, initially priced at $38 a share. Facebook shares are now trading at nearly $32 a share.
Facebook has disclosed that last year, 15 million users bought virtual goods on the site using its Payments service.
Write to John Letzing at email@example.com