Prediction: Facebook Will Surpass Google In Advertising Revenues
June 05, 2011 at 11:24 AM EDT
Not too long ago—the common perception was that Facebook advertising did not work. Why would a user notice an advertisement with a small image discretely tucked away in the right-hand column? In fact, most users were building up their " banner blindness ," and ignoring the right-hand column altogether. However, much regarding Facebook ads has changed since then. Changes in profile design encouraged users to provide more complete information and advertisers became educated in the value of hyper-targeting. Facebook’s ad serving algorithm improved dramatically and the launch of the Ads API allowed for an additional layer of intelligence to be built on top of that. Gradually, right-hand column marketplace ads became more effective for all types of advertisers—while Facebook concurrently grew its sales team to push out premium ads to brands and agencies. With all this progress, eMarketer estimated Facebook’s ad revenues at almost $2 Billion in 2010 and over $4 Billion in 2011. Despite all this success, Facebook’s revenues are still far behind the search giant , and claiming that they will surpass Google is a bold statement. However, there is a very clear path for this to happen and it is simply a question of when.