Plus Pages

Wednesday, January 4, 2023

Google and Meta’s Ad Dominance Fades


For the first time in nearly a decade, the two largest players in online advertising are no longer raking in the majority of U.S. digital-ad dollars, a decline that industry insiders expect to continue in years to continue, reports The Wall Street Journal.

WSJ Graphic
Alphabet Inc.Google and Facebook parent Meta META Platforms Inc. accounted for a combined 48.4% of U.S. digital-ad spending in 2022, according to estimates from research firm Insider Intelligence Inc. Their combined U.S. market share hadn’t been under 50% since 2014, said Insider Intelligence, which expects that number to drop to 44.9% this year. 

The ad businesses of Google and Meta are still growing, but Insider’s data suggest the pace is slower than the rest of the U.S. digital-advertising market. Insider forecasting analyst Zachary Goldner said the erosion of their combined market share was the result of brands having access to more advertising formats.

“All marketers want more options,” Mr. Goldner said. 

Google and Meta each faced headwinds in 2022, as people spent less time online than in the early days of the pandemic; marketers concerned about a possible economic downturn reined in ad spending; Amazon AMZN 2.17%increase; green up pointing triangle.com Inc. and ByteDance Ltd.’s TikTok continued their emergence as a force in digital advertising; and more streaming services started to embrace advertising.

Meta and other social-media companies including Snap Inc. also suffered from Apple Inc.’s 2021 decision to require apps on its devices to ask users if they wanted to be tracked. The majority of iPhone users opted not to be, hitting the heart of Meta’s business: its ability to target ads at users with precision and prove to marketers that the ads generate sales.

No comments:

Post a Comment