One of the biggest factors impacting revenue growth for Facebook (NASDAQ:FB) in 2019 is how it manages the transition to Stories from the News Feed in Facebook and the Instagram feed. Users have already shifted some of the time they spend in feeds to Stories, and Facebook has seen the number of users on its stories skyrocket in a short time, surpassing 1 billion total users in October.

CFO Dave Wehner was asked whether Stories advertising could eventually reach parity with feed advertising at the Morgan Stanley Technology, Media & Telecom Conference. He dove into several puts and takes that will impact Facebook's overall ads business in the near term. Here's what investors should be paying attention to in Facebook's Stories ads opportunity in 2019.

A man on a surfboard posting a video to his Story.

Image source: Facebook.

Stories are driving impression growth

Wehner previously noted that News Feed and Instagram feed are practically saturated with ads. Most of the company's ad impression growth in 2019 will come from Stories ads.

Since Stories ads are still a relatively nascent product, the growth in ad supply in Stories ought to provide advertisers with greater opportunities to reach customers cost-effectively. At the same, Facebook is working to improve its ad products, making them more effective.

One area of focus Wehner called out is direct response advertising in Stories. Direct response ads call for a viewer to perform an action -- visit a website, download an app, etc. They're a staple in Facebook's feed-based ads, and they can drive a lot of smaller advertisers to the format. Driving more advertisers to Stories ads is key to filling the increased supply Facebook expects to create this year.

While Stories engagement is cutting into time spent in feeds, it's not completely replacing it. As such, investors should expect to see the total number of ad impressions on Facebook's properties climb significantly in 2019. Last quarter, ad impressions climbed 34% across Facebook apps. That's the highest rate since 2016, and it ought to remain elevated through the year as Stories ad supply increases.

Feed ad prices will increase

Relatively low-priced Stories ads will put pressure on Facebook's average ad price, but it's important to remember the bulk of revenue and ad demand still comes from feed ads. As a result, the company should see the average ad price for feed ads increase over the next year in light of growing demand and potentially declining supply as some engagement shifts to Stories.

That should help mitigate the impact of Stories ads on overall average ad prices, so investors should see the number remain relatively stable, down only slightly.

Measuring the progress

Stories ads are a very different beast than feed ads. That's why Wehner has stressed it will take years, not months, to realize the full potential of the product. So, if Stories ads are going to reach parity with feed ads, it won't be in 2019.

People consume Stories much more rapidly than feeds. A user might look at an image or video for less than second before flicking through to the next item. That means each Stories ad might be worth less than a feed ad, even when fully priced, because they don't receive as much attention.

At the same time, the rapid consumption of Stories content means there's more advertising opportunities per minute than in the feed, so Facebook could make up the difference with volume. To do that, it needs to attract advertisers to the product to fill the supply of ads.

Check out the latest Facebook earnings call transcript.

Facebook currently has 2 million active Stories advertisers. In order to get to parity with feed ads, it will need to get as many, if not more, advertisers as feeds currently have (about 7 million).

Management appears willing to disclose milestones around Stories advertisers, and it's possibly the most important number for investors to watch to judge the long-term growth opportunity for Facebook's Stories revenue. In the meantime, expect average ad prices to decline and ad impressions to climb, obfuscating the real progress Facebook is making.