A little over a week ago Zynga’s stock price dropped below $5 for the first time. Now we are seeing Facebook ads and sponsored content popping up on Zynga.com, marking the first time these ads have appeared outside of the Facebook ecosystem.
So what you say? The move to utilize an existing partnership with the popular gaming company, Zynga, probably has many people thinking “Who cares if I see some ads for tractors while I’m trying to Farm my Ville?”
Don't be fooled. It goes much deeper than that.
For starters, this is the first time Facebook Ads have been on another site, which likely means the start of a big advertisement push and expanding reach across the Web while answering critics' questions about Facebook's ability to generate actual revenue. This could mean a new round of challenges to Google and their online advertising business.
An interesting infographic from Wordstream compares the two companies and examines their reach, revenue and performance.
A few interesting numbers to consider:
- According to ComScore Data Mine: Google reached a billion unique visitors worldwide in May, while Facebook saw 713.6 million.
- Facebook generated $1.86 billion in ad revenue last year and sis expected to top $4 billion this year. Google reported $29.3 billion in overall revenues last year.
- eMarketer estimates that Google had 38.5% of the online advertising market last year, compared to 4.6% for Facebook. The research firm also estimates that Facebook's share will grow to 7% this year compared with 40.8% for Google.
Bottom line: Google is clearly the leader today in online advertising. Their ad creation tool is based on the keywords and match type that you select. As experts in knowing what users are searching, location and browsing history, Google takes advantage of this information by showing the most relevant ads to a user’s search query. But is your search query more important than who you are?
Facebook Ads focus in on the user. They have an endless supply of information from their users. Facebook’s ad creation tool asks for personal details about their users making it easy for marketers to target them through advertisements.
Of course, information like this may seem private and in-depth, but most of us have already forked over most of these details to them. For example, if I want to visit the Huffington Post website through their Facebook application just to read an article titled “Snooki’s Baby Bump,” I will have to give up valuable parts of my identity such such as my profile info, description, birthday, interests, likes…and my soul just for reading something about “Snooki.”
As marketers, it’s our job to figure out a strategy to create relevant ads for our clients and their products and services whether it’s using an advertising platform based on user intent or one based on user information.
Of course, ads are only going to generate money if they are relevant. And that is where Google thrives. It's how we search for anything online, so its only logical Google's definition of relevance matters.
However, on the flip side of things, ads are only relevant if they generate money. Confused?
Let's put it this way, if marketers find Facebook ads more effective, they will not hesitate to use that over Google Adwords. Most businesses will try anything new and are not married to a particular method or strategy if they can find a better way to increase revenue and conversions while reducing costs.
A different approach to online advertising could be on the horizon with Facebook leading the way, if it can generate more ROI for businesses. If Facebook used this latest move with Zynga as a stepping stone into launching an off-site advertising network, would they be able to overcome Google’s hold in online advertising? For now, Google Adwords will maintain their dominance in the online advertising world but this could be the start of something big as Facebook extends its reach.
What do you think? If you have any questions, please comment below or find us on Twitter @BFMweb