By Adam Levy
As advertisers look to deploy their budgets, Facebook is winning a larger share thanks to this trend.
A Super Bowl every day
Facebook COO Sheryl Sandberg once likened Facebook’s reach to the largest television event. “We have a Super Bowl on mobile every day,” she said.
And it’s true. Facebook has 1.23 billion daily active users — 1.14 billion on mobile and 180 million in the U.S. and Canada. The Super Bowl earlier this year attracted 111.3 million viewers in the U.S.
However, the average American watches less television today than they did a few years ago. View time across all age groups fell 11% in the six years ending last fall. The trend is more pronounced among younger people. People between 18 and 24 spent 35% less time watching traditional television during the second quarter last year compared to the second quarter of 2010, according to Nielsen.
While Facebook isn’t the only reason people are watching less TV, it presents a very good option for advertisers looking to replace that lost watch time.
Facebook is taking a huge share of digital advertising growth
Digital advertising is growing rapidly, but that doesn’t mean all of that ad spend will go to Facebook. Nonetheless, Facebook has done an excellent job winning those new ad dollars flowing from television ad budgets to digital.
Facebook is poised to continue capturing a lion’s share of digital ad spend growth in the future, too. Display advertising is the largest form of digital advertising today, and eMarketer expects that to remain the case in the future. Facebook holds a wide lead in display advertising, bringing in around $12 billion in the U.S. last year compared to less than $5 billion for Google.
Facebook is also working to attract more video content to its platform, which fits nicely with the trend of shifting ad budgets. Facebook is reportedly funding new content productions for its platform in the hopes of seeding an entire ecosystem similar to YouTube. YouTube has proven extremely lucrative for Google, and Facebook wants in on the billions of digital video adverting revenue it generates every year.
Not only are ad budgets shifting from television to digital, Facebook is one of the few companies that’s been able to attract those ad dollars thanks to its audience size, engagement, and ad targeting capabilities. As the trend continues through the end of the decade, that makes Facebook an awesome buy.