Beware Of Headlines About Facebook's Dominance Of Display Ads

Maybe you saw the news: that, per eMarketer, Facebook is about to pass another milestone. The research firm said it will surpass Yahoo in display ads by the end of the year, with a 17.7% share of the overall market, a huge jump from the 12.2% share it had last year.

On the one hand, this news is a long time coming. When you consider that Yahoo has been in a downward spiral at least since it was temporarily engaged to Steve Ballmer, it seems surprising that it's taken this long for Facebook to pass it by in this most bottom-line-oriented of online advertising categories. 

On the other hand, I get a little bit queasy in seeing Yahoo and Facebook compared in the commodity-driven world of display advertising. My reaction, instead of being, "You go, Facebook!" is closer to dissatisfaction. If all people in social media -- or on Wall Street -- do is focus on how Facebook stacks up in display ads, then they are missing the point about what Facebook is. 

Sure, eMarketer is predicting Facebook will rake in more than $2.2 billion in display ads this year, for an increase of more than 80%, and sure, Facebook offers some targeting capabilities that a mere portal doesn't. Still, when marketers are figuring out how to reach people on Facebook, or trying to decide where their online budget should be spent, will they remember these headlines about Facebook-as-display-ad king and figure that's all there is to it? I sure hope not.

Facebook may be a nifty place to, as the Facebook Ads home page says, "Choose your audience by location, age and interests," but lots of places do that. It's also about interconnectedness. Theoretically, anyway. But too many advertisers seem to be treating Facebook as just another platform that serves up pixels. In other words, if I see that display ad that says, "Racheal [sic] Ray Loses 32 lbs." one more time I'll plotz. And click on it? Never! 

Facebook is not Yahoo, or for that matter, Google, the other member of online display advertising's Big Three. It has unique capabilities in allowing advertisers to capitalize on word-of-mouth and in letting advertisers actually hold a dialogue with their customers, rather than just throwing ads at them. That's something most mere display ads don't do. But because of advertisers' display ad mentality, how often do you actually click on a display ad on Facebook? About as often (which is to say, not very much) as you click on display ads on sites that aren't inherently social? That's because advertisers aren't really leveraging Facebook, they are only buying ads on it, albeit billions of dollars worth.  

No wonder Facebook has set up Facebook Studio, to let advertisers and Facebook demonstrate what marketing on Facebook can mean. For an advertiser, being on Facebook should be about much more than Rachael Ray.

Tags: social media
Recommend (3)
1 comment about "Beware Of Headlines About Facebook's Dominance Of Display Ads".
  1. Dan Bonert from Yahoo , June 24, 2011 at 10:29 a.m.

    So full disclosure, yahoo employee. Before you say Yahoo is in a downward spiral please check your facts.

    1. Yahoo is the #1 site in the US, reaching an all-time record of 189 million unique users in May. That’s more than Google for seven straight months and more than Facebook has ever reached!

    2. Yahoo! is home to ten #1 properties in the US - including the Yahoo! News Network, Yahoo! Sports, omg!, and Yahoo! Finance. Yahoo! has twice as many #1 properties as the next closest competitor.

    3. The Yahoo! Home Page is the most-visited page on the US Internet, with 34 million daily visitors, more than the MSN and AOL home pages, combined.

    4. Each month more than one-in-ten online Americans (24 million) watch a Yahoo! original video program, such as Daily Ticker or Daytime in No Time – that’s more people than watch shows on Hulu.com.

    5. More than 6 million Yahoo! Finance users check 281 million stock quotes each month – that’s more page views just for stock quotes than all of WSJ.com, Bloomberg, CNN Money, Google Finance, MSN Money, or AOL Money & Finance.

    I have more