Facebook Thinks It’s Better for Advertisers Than TV
Facebook (NASDAQ:FB) is trying to convince advertisers that it’s a better place to target large groups of people with ads than television, hoping to grab some of the huge amounts of cash advertisers typically spend on making TV commercials.
Per a company blog post, Facebook is citing its advertising efforts with both AARP and the American Legacy Foundation as evidence for its success at reaching large groups. AARP has used Facebook to target users older than 45 with information about the organization and attempting to show users that AARP isn’t just for retired people. The American Legacy Foundation is using the site to reach teens with its “Truth” anti-smoking campaign.
Facebook’s 1 billion users rivals the number of people watching TV. Data from eMarketer seen by Reuters show that television still gets the biggest chunk of money advertisers spend, with TV making $66 billion in 2013 alone. Facebook made about $7 billion in ad revenue last year and has been highly successful at monetizing its mobile platform. In the fourth quarter of 2013 alone, Facebook’s ad revenue jumped 76 percent year-over-year to $2.34 billion.
“For an advertiser, in Facebook’s view their users are more engaged than when they are watching TV,” said Debra Aho Williamson, principal analyst at research firm eMarketer, to Reuters. “It’s not just sitting on the couch and watching something go by.”
Data from Nielsen Online has found that both those advertising campaigns have been successful at reaching their desired audiences. The report found that 14 percent of Americans between the ages of 45 and 64 saw the AARP campaign. Even more impressively, about half of Americans between the ages of 13 and 19 saw at least one ad for the Truth campaign in their Facebook News Feed. Representatives from both campaigns told Reuters that Facebook is a key part of their advertising efforts but that it’s also important to target people on a wide variety of platforms.
While Facebook may want it to seem like users pay closer attention when engaging with social media than they do while watching TV, other data have found that not to be the case. Research from TiVo seen by eMarketer found that when multitasking with multiple screens, people pay closest attention to the television. While it’s common for people to engage with smartphones, laptops, and tablets while watching TV, their focus is for the most part on whatever they’re watching. Facebook is a key aspect of many advertising campaigns, but television can’t be completely written off just yet.
Despite recent concerns that Facebook is losing its teen user base, the performance of the Truth campaign on the site seems to show that teens can still be reached on the platform. While some analysts have worried about a small drop in young users, others say that Facebook has built itself into a utility for users of all ages, making it more valuable than just a “cool” site for young people.
The recent $19 billion purchase of WhatsApp, which has been cited as one of the popular messaging apps drawing young people away from the “less cool” Facebook, could give the social media giant another platform to appeal to young users. Facebook CEO Mark Zuckerberg said the company will focus on allowing WhatsApp to achieve its full growth potential before monetizing the service, but if Facebook’s belief that the app is on track to reach 1 billion users comes true, the site will have another, possibly cooler way to continue its successful efforts at targeted advertising.
More from Wall St. Cheat Sheet:
- Why It Doesn’t Matter That Facebook’s Users Are Getting Older
- Why Is Facebook Spending Billions for WhatsApp?
- Facebook Hits a Grand Slam With 4Q Earnings
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