
Facebook Takes 31.2% of the U.S. Ad Display Market  - amnigos
http://mashable.com/2011/05/04/facebook-ad-display-market/
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beagle3
Prediction is hard. Especially when talking about the future.

FB might dethrone Google, of course. But the 30% number does not imply that.
Ads in google are pretty damn effective for _everyone_ who is using them,
whereas (from what I've heard of people in the industry), the only ones who
are happy with FB ads are "lifestyle" advertisers who can't actually measure
their impact.

If you look at Real Time Bidding, there are ~100Billion impressions per day,
of which 80% are worth $0.0000 or less, and then it starts rising with most
commanding about 300-400 microdollars per impression, with a few publishers
commanding 30000-40000 per impression.

If FB owns all of the 80% and most of the 15% that are 400 microdollars, and
google owns the 5% of 40000 microdollars, Google is not in danger (yet; they
shouldn't rest on their laurels, of course).

The info I have, skewed a little by the RTB industry (but which is
increasingly becoming _the_ online ad industry), is that for now the case is
as described in the previous paragraph.

~~~
orijing
_Ads in google are pretty damn effective for everyone who is using them_

Possible, but don't forget Google has nearly a decade on Facebook in that
arena. With that amount of time, most of those advertisers who found it to be
ineffective would have stopped using the service, so it is a selection-bias
issue.

In comparison, Facebook's relatively new. With enough time, Facebook ads will
become comparatively effective for everyone on them, as people learn how to
use them better, as Facebook adds more ads features, and as those with the
wrong business or advertising model pull back and try something new.

Edit: What is it with Hacker News being so antagonistic when someone defends
Facebook against an unjust assault? If Facebook were Google and Google were
Facebook, I would have said the same thing: Time allows advertisers to adjust
their advertising strategies and platforms such that, in equilibrium, _you
wouldn't be using the platform that is ineffective_ and hence those who still
use a platform are probably finding it effective.

This is not a matter of Facebook fanboyism, but one of selection in market
equilibria. It's like asking a buyer of some particular brand of tofus whether
they like the tofu. Well, they wouldn't buy it from that brand if they didn't,
so hearing a majority of "yes" doesn't say so much.

~~~
il
The time frame doesn't matter too much, there is a fundamental difference
between intent based advertising and interruption advertising.

CPMs for social networks will always be lower because there are so many more
pageviews per user, and the user isn't searching for anything or in a buying
mood.

~~~
orijing
But effectiveness isn't about the number of clicks you get, but ultimately the
value you derive from the impression (and the probability of a click).

If advertisers get 30% less out of Facebook ads but it costs 30% less, then
the effectiveness is comparable.

~~~
il
It's comparable for the advertiser, but it's not good for Facebook. Their
inability to get higher CPMs for their traffic is a big problem for them.

~~~
orijing
OK, I see what you mean. I was speaking from the perspective of the
advertiser.

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hnsmurf
I'd be more interested in seeing the breakdown by revenue. In my experience FB
ad CPMs are way lower than Google's. Even if they had equal impressions Google
would still be profiting something like 10x more probably.

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veyron
Stupid Question [stupid because I should know this]: If facebook shows 4
advertisements on a page, is that counted as 4 impressions in the
"impressions" metric? Has there been any effort to normalize the effect of
showing ads [I don't think I've ever seen a google page or search with 3, let
alone 4 ads]? Theoretically, a person could load a page with a ton of ads and
artificially boost the impression measure ...

~~~
idoh
Yes, each ad would show as getting an impression, even though there was one
page view.

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listic
What is that "display advertising impressions" that Google is new to?

~~~
brandnewlow
Banner and rich media ads sold on a CPM basis rather than a CPC basis.

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programminggeek
For all the talk about one beating the other search and display ads are
completely different channels and Google has never been particularly strong in
display ads.

Google makes so much money by dominating the search advertising market that
they pretty much dominated the entire time that they can try and get a
foothold in other mediums like display, social, radio, tv, newspaper, and so
on.

The problem is that Google isn't nearly as good at those things because they
don't have their own product to put it on. Without that they don't intimately
understand the needs of buyers and they stop investing in those things before
they are fully baked.

Of course facebook is dominating display advertising because they put pictures
next to their ads. Google doesn't do this for product quality reasons. That
makes sense.

In the end both are going to make gobs of money and dominate their respective
markets.

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jacques_chester
Key question: are these new ads or ads taken from Google?

Otherwise put: are Facebook taking a larger slice of Google's pie, or have
they grown the pie overall?

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MenaMena123
Seriously, Facebook users could careless about those ads, with Google your
searching for an exact thing and those ads maybe helpful. When on Facebook no
one is buying they are about friends.

Its like an Ad in a hotmail email, the user is emailing someone not directly
looking for anything, search is key.

Facebook listen! ok? You need a Facebook Search, then you got that advertising
game! :)

~~~
mrspandex
I have to say, Facebook ads have been spookily relevant to my interests and I
click them almost regularly. When I'm on Facebook, I'm just looking to waste
time anyway, so an interesting ad might get a click. Google search ads are
usually for sites I already knew about and visited.

~~~
rprospero
I've had the exact opposite experience. In the past month, I've received
Facebook ads for diet pills (I'm skinny), office temp work (I have a job),
tequila (I don't drink), DVRs (I don't have cable), and real estate (in a city
I don't live in).

Granted, a couple of those may be unfair. Facebook doesn't know my weight
(though they do have my photo) and they probably wouldn't be able to data mine
out that I don't drink. On the other hand, why are they trying to sell me a
temp job when they know that I'm currently employed? Basic data mining should
tell them that most of my social group doesn't have cable, so why are they
trying to sell me a DVR? Plus, Facebook knows that I'm recently single and
they couldn't think of anything to do with that? Or was that the tequila?

This is why I'm always surprised by the hubbub around facebook advertising. I
actually get better targeted ads from the local newspaper. I guess Facebook's
future just depends on which one of us is the anomaly.

~~~
phlux
> _"Granted, a couple of those may be unfair. Facebook doesn't know my weight
> (though they do have my photo) and they probably wouldn't be able to data
> mine out that I don't drink. "_

You have just identified the next big thing in marketing: Parsing facebook
pictures for ACTIVITY and PHYSICALITY of the people in the photos, then
directing ads towards them based on the relevant info garnered from their
photos.

If you have a bunch of pics of you RUNNING, SWIMMING, HIKING, SKIING,
SNOWBOARDING etc... you can target that user base to sports ad companies.

Fat people get diet pills and other offers...

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xnerdr
I still say it's pretty much over for Google. <http://nerdr.com/facebook-eats-
googles-lunch-by-2012/>

They're being out played on their primary revenue stream and facebook isn't
even breaking a sweat.

~~~
bad_user
That link is one of the worst articles with shitty predictions I ever read.

Big companies have a lot of resources available to get back on track -- Apple,
Intel, Microsoft and even IBM are still around and kicking.

Even if Facebook wins and Google loses, I'm just curious -- what's in it for
you?

