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Facebook reaches advertising milestone as small businesses swell

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SAN FRANCISCO — Facebook now has 4 million advertisers, adding to the ranks of small businesses that are trying to reach customers on the giant social network.

“We are really excited to do the announcement that we have four million advertisers. I think the story is basically about the movement to mobile,” Facebook’s chief operating officer Sheryl Sandberg told USA TODAY.

Facebook has identified small businesses as one of its biggest opportunities. Mobile has accelerated adoption among small businesses, especially overseas. More than 70% of Facebook advertisers are overseas and the fastest-growing region is South East Asia, the company said.

“We know that consumers have moved to mobile. Mobile phones have the fastest adoption of consumer communications technology the world has ever seen and people are spending more time on their phones, more engagement on their phones, doing more things on their phones, and the phones can do more. They can do video, they can do 360 photos. The phones are this very immersive creative canvas,” Sandberg said. “Businesses are really understanding that they need to be where people are which is on their mobile phone.”

Facebook advertisers range from household names to mom-and-pop operations but the growth is coming from small businesses. Facebook is aggressively promoting itself to small businesses, providing them with free pages and services to manage their digital presence in hopes of turning them into paid advertisers.

The sharp increase in the number of advertisers — up 33% in seven months — is an impressive milestone that escalates competition with Google, which has traditionally drawn big dollars from small businesses in the lucrative search advertising market.

“Facebook’s growth to 4 million advertisers is an enormous accomplishment, especially coming so quickly on the heels of its 3 million advertiser milestone only six months ago, in March 2016,” said eMarketer analyst Debra Aho Williamson. “Facebook is an indispensable advertising tool for many advertisers.”

Facebook is aggressively growing the number of paid advertisers around the globe. In March, it announced 3 million advertisers, up 50% from 2 million in February 2015. Facebook said it reached 1 million advertisers in June 2013.

More than 90% of Facebook’s users are on mobile devices, where Facebook makes most of its advertising revenue. Advertising on mobile devices accounted for 84% of Facebook’s $6.2 billion in advertising sales in the second quarter. Revenue from mobile ads rose 80% in that quarter.

Four out of 10 Facebook advertisers have created a Facebook ad on mobile and two in 10 have created video ads, the company said.

Facebook executives Sandberg and Dan Levy declined to comment on Facebook’s acknowledgment last week it overstated a key metric — the average time users spend watching videos. The revelation angered advertisers.

Facebook said Monday it should have come clean earlier. “We should have just said in public that we found this error a month ago and made the correction, and not just called our clients and agencies,” Facebook’s advertising boss Carolyn Everson said on stage at Advertising Week in New York.

Follow USA TODAY senior technology writer Jessica Guynn @jguynn

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