Facebook to Pass Google in Marketers’ Hearts?
Facebook could soon be more important to marketers than Google, if Wall Street analysts are right. The soothsayers are already noticing Facebook pulling digital advertising market share away from Google and lesser competitors, Twitter and LinkedIn. What’s on the horizon, though, will really update Facebook’s status in marketers’ minds.
CNNMoney reports on Thursday that market analysts are bullish on Facebook’s stock because of its clout with marketers.
In “Why Facebook Could One Day Be Worth $1 Trillion,” Paul R. La Monica says Facebook’s ad growth and expected scaling up of its new marketing tools will help bring in a predicted 32 percent yearly rise in profits. That will make the social media giant’s expansion “twice the expected earnings growth rate for Google and nearly triple Apple's estimated growth rate.”
The article cites a report from Pivotal Research analyst Brian Wieser.
"We estimate the company will capture 47 percent of global digital advertising growth and 43 percent of all advertising growth outside of China this year,” Wieser writes. “And this is before several future engines of growth have begun to scale."
Along with its core network, Wieser expects to see revenue increases come from Instagram, Messenger, WhatsApp and virtual reality company Oculus.
La Monica editorializes: “Facebook is just crushing it on mobile. The company now has 1.51 billion monthly active users logging in on their phones and other mobile devices, up 21 percent from a year ago. And Facebook now gets 82 percent of its total ad revenue from mobile.”
In its Q1 earnings call on Wednesday, Facebook details a couple of other tools marketers may help the company scale up:
Facebook Chairman and CEO Mark Zuckerberg
“Part of our playbook for building out these ecosystems to scale is we start with the person-to-person use case. Right, so whether that's in messaging, people messaging their friends or groups, News Feed before that, it was people posting updates and seeing what was going on with their friends and the people that they care about. And then the next step is to create organic activity around public entities. Right, so whether that's businesses, public figures, like athletes and celebrities and types of folks that people want to interact with on these different platforms, we did that on Facebook and News Feed or Pages, and we're working on a number of different ways to do that in Messenger.
One of those is bots. [Emphasis added] One of the good things about bots that we've seen is that it can … decrease the amount of time that you have to wait before you get a reply back from interacting with a message. So what we've seen, we've done some research on this. A lot of people every day in Facebook today are already messaging pages and businesses directly. And the businesses respond. But what we've actually also found is that, through some of our AI research, we can look at the responses that businesses give to common questions and can confidently provide the right reply a lot of the time.
And when we can do that, then that decreases the latency and predictably people want to do more of that activity. … We can build artificial intelligence that can learn from people how to automate a lot of that and make that experience a lot faster for people who want to interact with businesses and public figures. And of course then after you start building out that segment of businesses and public figures and the platform, then on top of that you have just a good amount of intent in these platforms to build a good business on top of that, that kind of stage …"
Facebook COO Sheryl Sandberg
"Audience Network is important to us because we're making a strategic investment in ad tech, helping advertisers and publishers grow both on and off Facebook. We think we're uniquely placed to bring people-based marketing to scale and solve the measurement problem, and the Audience Network is a place we're really focused because we feel like we're delivering value for advertisers and publishers so we're investing behind the growth we've seen.
We've seen a growth of native ads, 83 percent of the overall inventory on the platform is native, and over 50 percent of our publishers are only using native ads.
We have some great examples of Audience Network really improving people's results. Our recent one is EBay Viva Nuncios, which is an online real estate destination working in Latin America and Mexico. When they were using a combination of Facebook, Instagram and the Audience Network, they saw 57 percent lower cost for install with placement optimization and 59 percent more volume vs. running on Facebook alone, which led to 6 percent incremental revenue. So compared to November a year before, the number of their app installs increased by 115 percent.
What we're seeing is [with] the results we're able to deliver on Facebook and Instagram, a lot of our marketing partners want more and our ability to do that is why we're investing in the Audience Network."
What do you think, marketers?
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