Facebook Ad Expansion Slows, Advertiser Backlash Cited

Facebook’s turbocharged ad expansion has begun to slow, cooling to a 16% rate of growth in the third quarter -- down about half the rate of the beginning of the year -- according to estimates released today by Standard Media Index.

The data, which is drawn from a pool of the industry’s largest agency holding companies is based on actual media-spending, and shows that after beginning the year with a first-quarter expansion of 35%, Facebook is now barely keeping pace with overall digital ad marketplace growth.

The data does not include spending from local advertisers or small and medium-sized businesses -- just national advertisers represented by the big agency holding companies.

Facebook’s third-quarter advertising growth compares with the digital ad industry’s overall expansion of 14%, according to SMI.

Year-to-date, SMI estimates that Facebook ad spending is up 25%, but if the fourth quarter mirrors the slowdown, it would confirm that the falloff is at least partly due to some backlash surrounding the social networks' ignoble publicity earlier in the year -- especially its lax policies and seeming disregard for protecting its users’ data.

“Major brands are concerned with recent events there and are focusing on brand-safe environments,” SMI CEO James Fennessy stated as part of the release of the data.

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