Forecast Finds Ad Spend On Facebook Exceeds Time Spent

A new forecast suggests that ad spending on Facebook is outpacing the share of attention it commands daily in digital media. U.S. adults will spend an average of 21 minutes a day on Facebook this year, accounting for a third of time spent on social networks, 6% on digital devices, and 2.8% on all media, according to the eMarketer forecast. 

But the 6% of digital time spent is less than the 10% of U.S. digital ad dollars flowing to Facebook, in contrast to other digital media categories where time spent outstrips the share ad spend. Excluding Facebook, for example, other social networks will garner 11.9% of digital time, but only 3.9% of corresponding ad revenue.

Further, eMarketer estimates video will account for 15.9% of digital time spent in 2014 compared to 11.7% of ad revenue, while online radio will claim 11.2% of digital time but only 4% share of digital advertising. In the latter case, the report partly attributes that discrepancy to the fact that online radio is often in the background,  so users may tune out the ads or just not hear them.

Pandora actually grabs a larger share of digital time spent than Facebook at 7.1%, but will draw only 1.4% of U.S. digital ad budgets. While digital video may be more engrossing than online radio, viewers can easily ignore or skip ads, and targeting remains a challenge for marketers in the emerging medium.

The report argues that users’ attention on Facebook, however, is likely to be closely focused on content, where native ads in the news feed aren’t as easily ignored. “In addition, Facebook has worked very hard to convince advertisers its audience, customer data and targeting capabilities are the best advertisers can buy, which has contributed to its' trending ahead of the market,” it states.

A separate JPMorgan research note released this week, citing comScore data, showed that Facebook’s share of total U.S. Internet minutes in August across both mobile and desktop increased to 17.5% from 16.3% in the past year. In terms of methodology, comScore relies on panel-based data, while eMarketer’s findings are based on an analysis of what it calls 500 data points from 70 different research sources.

The eMarketer document also pointed out that the 21 minutes spent per day on Facebook may seem low, but that the figure is averaged across the entire adult population, with only 52.8% of U.S. adults logging into or accessing Facebook at least once a month this year.

Overall, eMarketer expects that nearly half of major media time each day this year will be on digital devices, or 5 hours, 46 minutes, but only 30.5% of total major media ad spending will go toward digital channels. But as many industry experts have pointed out, media budgets aren’t allocated simply based on time spent within each channel. 

1 comment about " Forecast Finds Ad Spend On Facebook Exceeds Time Spent ".
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  1. Martin Rivers from CAQ, September 19, 2014 at 3:52 a.m.

    I am constantly amazed that companies allow employees to spend time on the internet during work hours. I work in a small company BFWG Grants and it frustrates me so much that my co workers think it is ok to spend time texting and checking Facebook during work hours.

    It almost seems like it is the right of the employee rather than a perk.

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