And the answer is simple… advertising.According to a report by Zenith Optimedia, Google now controls 44 percent of all online ad revenue worldwide. Its nearest competitor is Yahoo with a mere 8.3 percent. It is estimated that 2011 will see $464 billion in online ad expenditure with a further 4.7% growth predicted for 2012. Google over a 5 year period has seen its share of global internet ad expenditure increase from 34.9% up to 44.1%, in the same time Facebook has gone from 0.2% up to 3.1%.
So why would Google worry about Facebook’s share of ad revenue? According to the Huffington Post, Facebook’s US ad revenue is set to overtake Google’s in 2011. The shift has been centred around data. Facebook are able to offer companies far greater personalisation and targeting than Google can because Google does not know its users.
Google’s social platform allows users to enter and share data which identifies their likes and interests. The true value of the Google+ platform can be seen on Google itself.
The new Google tool bar is just one of the signs that Google is following you as you surf through their offerings. Each interaction, video you watch, story shared is stored alongside your profile and gives Google a greater idea about its user base and you. Just like Facebook.
For example: As a keen United supporter, I like and share content via Google+ to my Circles as well as liking their pages. With that information Google can target Manchester United adverts around clothing, betting, tickets and more direct to me anywhere Google AdSense is used. This will increase the costs to advertisers, but they won’t worry because this is their target audience. Its not just an ad, its now personalised to my interests thanks to Google+.
The Game Changer
The future of this war over data is never going to be won because the battle ground is so vast that there is enough for everyone to have a piece. However, the next big platform for advertising is about to explode onto the advertising scene.
Although YouTube has been around for years and is not new to users, the offering is in transition. It is now offering movie rentals as well as making inroads into original content and shows. In a recent study 71% of all American adults currently use a video serving site such as Vivo or the Google owned YouTube (compared to 61% who use social media). This means that Google already have the brand leader in a market which is bigger than the social media space. Why is it such a game changer?
Google can now offer advertisers the same keyword targeting that Facebook can, but this time on a platform which is even bigger. Advertisers have always wished that they could do targeted advertising during TV shows. With YouTube offering a viable contender to the TV market and the ability to target verified leads like Facebook, the offering is just getting started.
No wonder Mark Zuckerberg is desperate to expand his offering into digital!