Written in the front: At the time of writing this article, the author did not have a strong concept of the size of the US online advertising market. It can be said to be a small one, and then my heart is humming. How large can this market be, 30 billion? 40 billion? The results were shocking when they saw the numbers. The conclusion is: The online advertising market in the United States has a scale of 60 billion yuan, which is equivalent to Apple's 3 years of global sales!
According to Bloomberg, the market size of online advertising in the United States reached 59.6 billion in 2015, a 20% increase over 14 years. And most of this increase comes from the mobile phone. McKinsey predicts that the global digital marketing market will reach 231.4 billion in 2019, a compound growth rate of 12.7%. The two biggest companies on this battlefield are FB and Google (market share: Google 50%, FB 14%) .
| Attention: Phone Screens> Computer Screens
What must be emphasized here is the biggest difference between mobile-side advertising and computer-based advertising. This is also the biggest advantage of Facebook - the mobile phone is more focused! The main manifestation of the large space for mobile advertising is attention, simply saying that mobile phones with small-capacity and small advertisements are more easily seen.
FB's data is sufficient to illustrate this point - Facebook advertising growth all come from the mobile phone, the computer is a negative growth! ! ( Because of the low market share of FB15, FB is likely to exceed 30% of the online advertising market in the United States next year, so growth must be sustained. )
| Although the business model is different, but the goals are similar, among them the Facebook is slightly superior
The biggest reason for the different business models of Google and Facebook is that they have different channels and forms for customer diversion, which is determined by their different attributes in life. There are two main forms of Google's advertiser-driven diversion -- Google Simple Page Ads and YouTube Video Ads; and FB is attracted by its 1.13 billion DAUs and over 50 minutes per person (FB and Instagram). Advertisers.
Both of Google's and FB's methods of diversion are good for general business efficiency and effectiveness, but FB has proved in the past year that its advertising frequency can be increased and the value of Mobile Terminal's advertisements is more valuable. This is true for Google. A very obvious threat! The most important indicator here is that if Google’s advertising revenue growth cannot outperform the industry, it can clearly indicate that Google’s online advertising business is impacted .
When it comes to the purpose of advertisers, it must be to allow customers to purchase. Both FB and Google can accomplish their tasks efficiently, but FB has one more feature than Google - "stimulate potential purchasers" . In the context of Google’s construction, consumers have a more obvious purpose. They choose through search. That is, when the buyer has already purchased, the scene built by YouTube can only rely on the user’s portrait. The video/content tag viewed by the user to push the advertisement to the user is also less accurate.
| Facebook advertising how to "guide" users consume
Generally, European and American advertisers have their own member database. The information contained is usually a phone number or an email address. This happens to be the Unique ID of each user on Facebook. With this database, advertisers can choose to push only to people on the list or they can choose to follow the user’s image on the FB in the database to outline the target customer’s image and then push ads for the image. This model of FB can stimulate potential consumers to generate purchasing behavior, and secondly, it can also increase customer loyalty.
In addition, according to the Economic Times caliber, the cost of brand advertising on FB is much lower than the cost of advertising on the TV side: In 2015, the prime time for TV stations was about 50 US dollars per 1,000 people, but FB ads only cost 5 US dollars.
| Google has a coping strategy?
At present, Google's coping strategy is relatively simple. It is through the alliance with other Internet players to weaken the momentum of FB. After Google and Twitter formed an alliance last year, Twitter's content can now be found on Google. This action was intended to slightly increase the relationship between Google and socially strong scenes, but the effect is very general; Google also cooperated with Yahoo, allowing Google to Yahoo search results provide ads. But it seems that these are mostly computer-based extensions, and Google seems to be a bit incapable on the mobile phone side, so developing the next profit point becomes extremely important.
Last year, Google’s core revenue was 75 billion, and 2015 Q4 was 21.3 billion. This year, Q1 and Q2 revenues were only 20.1 billion and 21.3 billion. Assuming similar conditions in the second half and the first half of the year, Google’s core revenue for the year is 830. With the level of 100 million yuan, the growth rate will be 11%. This is similar to the forecasted growth rate of the industry. However, the growth rate of the industry will eventually outperform. Therefore, Google’s online advertising market is likely to see its competitiveness weakened from the data within the next year. This is because it will be affected by the high growth rate of FB’s mobile advertising business. At present, the momentum of Google's advertising business has not yet declined. It can only be said that FB is still only grabbing others' share so far.
For Google, at this stage, it is absolutely necessary to seek new growth points for future performance (such as the aforementioned cloud service platform for artificial intelligence and the driverless car he is currently working on) . Fortunately, time is still abundant. Because the online advertising industry is still growing faster. As a leader, Google can at least stabilize earnings in this interval (before 2020) and wait for the arrival of new profit growth points.
Written so much, the author's inspiration for the two giants of the Internet warfare has four points:
The core of the advertisement is the attention of the user. The mobile terminal is absolutely superior to the PC due to its small screen, and attention is scarce resources. Therefore, the competition for the mobile terminal advertisement is always a warfare.
Face book can be personalized push because of the advantages of data and advertisers, and Google can hardly do this, making Facebook a higher level than Google can guide users to spend;
Facebook faces rising high-speed threats to Google, Google's response strategy must use its leader (50% market share), develop new profit growth points to reduce the threat;
WeChat may have a similar impact on Baidu in the future, but it is certainly not now. Wechat's social network based on strong relationships does not support large-scale advertising. Tencent needs to solve the problem of how to combine advertising with strong and effective interaction. As for Baidu's attempt to increase its own mobile Internet scene through O2O, it will also be effective, but it is still far away from users, and it is expected that Baidu and WeChat will compete for advertisers in this battle.
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