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Facebook Should Leapfrog Microsoft in Advertising This Year

Google Dominates Online Advertising, But Facebook Is Moving On Up

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Facebook Should Leapfrog Microsoft in Advertising This Year
[ Business]

ZenithOptimedia has put out a new report looking at global ad expenditure, predicting that it will end this year at US$464 billion, which would be 3.5% higher than in 2010. The firm also predicts that this will accelerate to US$486 billion, and expects it to grow 5.2% in 2013 and 5.8% in 2014.

“Most of the growth in global ad expenditure is now coming from developing markets, which we
forecast to contribute 58% of new ad dollars between 2011 and 2014,” the firm says. “Asia Pacific, Central & Eastern Europe and Latin America are all expanding much faster than the developed world, driven by both their current economic performance and their future potential.”

“Over the next three years we expect Asia Pacific (excluding Japan) to grow by an average of 10.4% a year, Central & Eastern Europe to grow 9.6% a year and Latin America to grow by 7.3% a year,” the firm adds. “The exception is the Middle East & North Africa, where political turmoil has disrupted media production and distribution, and made advertisers wary of attracting negative attention. We forecast the Middle East & North Africa to grow at an average of 1.3% between 2011 and 2014. Overall we expect developing markets – which we here define as everywhere outside North America, Western Europe and Japan – to increase their share of the global ad market from 32.3% in 2011 to 35.9% in 2014.”

Here’s what the firm has by medium:

ads by type

And market share:

ads market share

As you can see, Google dominates by a pretty significant margin. “ Over this time Google has tightened its grip on global search (raising its share of searches from 72% in 2006 to 85% now) and established a lead in traditional display and online video with the help of the acquisition and development of companies like DoubleClick and YouTube,” the firm says.

What’s interesting is that while Microsoft, Yahoo and AOL have all been on the decline, Facebook’s share appears to be growing steadily, and could be well on its way to jumping Microsoft. “Since 2006 Facebook has established itself as a major supplier, increasing its market share from just 0.2% to 3.1% in 2010,” the report says. “Last year Facebook doubled its share and overtook AOL; at its current pace of growth it is likely to overtake Microsoft by the end of 2011.”

That will certainly be a good thing for investors to note as Facebook prepares for its IPO next year.

Facebook Should Leapfrog Microsoft in Advertising This Year
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