To Facebook's Chagrin, Time Spent Online Doesn't Equal Money -- Yet

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  1. CatfishRivers

    CatfishRivers Well-Known Member

    Apr 5, 2011
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    To Facebook's Chagrin, Time Spent Online Doesn't Equal Money -- Yet | Digital - Advertising Age (click for full article)

    Consumers Spend Days on Social Network, But Advertisers Still Spend Bulk of Dollars on Google

    By: Michael Learmonth Published: June 04, 2012

    It's the stat that filled a million PowerPoints, launched thousands of startups and dashed almost as many hopes: the hockey stick charting consumer growth of the internet -- and the presumed shift of ad dollars along with it.

    The $140 billion domestic ad dollars left in TV, print and other old media represent opportunity to digital players. But after 15 years of experience, it's clear that argument comes with one, huge caveat: Ad dollars do eventually follow users, but not on any particular timeframe and not necessarily proportionately.

    That could be a wakeup call for Facebook and its investors. Facebook commands 13% of time spent on the internet in the U.S., according to ComScore -- more than Google (including YouTube) at 11% or Yahoo at 7.9%. Yet its 2011 ad revenue was just $3.1 billion, in line with what Yahoo made from advertising in 2011, and a fraction of Google's $36 billion.

    What gives? Facebook's ad model is nascent, its utility to brand advertisers mostly still unproven, and no one really knows how to measure effectiveness on Facebook beyond valuing a "like," a share or a click-through. Yet that massive time-spent figure, not to mention the incredible trove of data both harvested by Facebook as well as handed over by users, means there's upside. The question is how much.
    Last edited: Jun 4, 2012

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