Following news that Twitter will begin
ramping up advertising efforts
, Facebook (NASDAQ:
) now has another website fighting to surpass the largest social
network in display advertisements. Google (NASDAQ:
) is poised to rake in about 15.4 percent of display ad profits in
2012 alone, beating Facebook by just one percent.
The New York Times
, ads that incorporate images or video have become quite popular in
the last year alone with the market growing 21.5 percent throughout
2012. While eMarketer had previously determined that Facebook would
remain in the lead with its many display ads, this is no longer
likely to be the case as the research firm lowered its forecast on
Mark Zuckerberg's unstable company this week.
As Piper Jaffray noted Thursday morning, Facebook's main product
is simple display ads shown on the side of its platform. With
Google closing in on a very important part of the company's profit,
Facebook is beginning to come up with other innovative ways to
attract businesses and consumers through advertising and the
utilization of its infamous newsfeed.
"[Facebook] has recently introduced an ad exchange and Sponsored
Stories, both of which appear to be performing well," Piper Jaffray
stated. "We believe there are two additional opportunities for
Facebook that appear to be relatively simple ways for them to
further monetize existing page traffic and extend the graph:
monetization of search and a more traditional ad network."
Facebook's advertising business will continue to rapidly evolve,
and the declining stock can be thankful for that. On Wednesday, the
social network saw its shares leap up almost 6.5 percent on news
that Facebook is
testing a service
to place ads on other mobile applications beyond its own. Closing
at $23.29 yesterday, shares were trading at their highest price in
As Facebook revels in its recent good fortune, the company still
must sleep with one eye open.
"Google has been pouring resources into its display ad business
and courting Madison Avenue," The New York Times reported. "Display
ad spending growth will outpace search ad spending growth for the
first time this year [according to eMarketer]."
Additionally, analysts at Morgan Stanley believe that Google
Chrome and Android guard the core advertising businesses - a job
that the company does not take lightly.
Although the advertising race will certainly be a close one to
call, both Google and Facebook are set to champion the market with
a combined estimated percentage of 29.8 percent. As other large
companies like Yahoo (NASDAQ:
) and Microsoft (NASDAQ:
) trail behind with 9.3 percent and 4.5 percent respectively, the
display ad accomplishments of Google and Facebook are something to
Facebook is down about 1.25 percent in Thursday's pre-market
session at $23. Google sits around $724 on Thursday morning, down
about .48 percent in pre-market trading.
(c) 2012 Benzinga.com. Benzinga does not provide investment advice.
All rights reserved.