Facebook may be The Next Big Thing, but it isn’t going to be the biggest anytime soon. When it comes to online advertising revenue, Google is still the biggest game in town, and it’s growing every year.
Back in 2009, according to a chart from eMarketer, Google’s share of the online advertising market was 34.9 percent, miles ahead of Yahoo! (16.1 percent) and Facebook (2.4 percent). For 2012, Facebook is projected to nab 8.8 percent of the online ad market, up from a projected 7.7 percent this year. That won’t be enough to come anywhere near Google, though. The search giant is projected to own close to half the space (47.6 percent), following growth to 43.5 percent this year.
What’s interesting is the stuff I’m seeing and hearing anecdotally (WARNING: strictly opinion from here). Google’s ads tend to be expensive, but you get what you pay for. From what I’ve seen with Facebook’s ads (in very limited markets), they are nice and cheap, but you wind up with few original impressions and a tendency to swamp people who probably aren’t going to pull the trigger. With this sort of dynamic, Google will be comfortable for a while.
So, what can Facebook do about it? The social media platform needs to find a way to tie its ads to action. Google has the advantage of serving up ads to people who are looking for something (i.e., they’re searching). Facebook is serving up ads in the context of a user profile, which doesn’t mean they’ll see an ad and take action. More impressions will be necessary as a result.