Facebook Set to Chip Away Further at Google’s Dominance in the 2017 Digital Ad Market

Digital ad spending in the US is predicted to surge 16 percent this year to a record-breaking $83 billion, according to a report by The Wall Street Journal. In a noteworthy yet unsurprising development, tech giants Google and Facebook are poised to emerge as the primary beneficiaries of this growth. Both platforms are set to monopolize even larger portions of the dynamic digital advertising landscape.

In 2016, Facebook commanded an impressive 12 percent of the total digital ad space, whereas its closest competitor, Google, controlled a notable 31 percent of the sector. This year, however, analysts anticipate a shift in the balance of power.

According to projections, Facebook is set to be the biggest gainer in the digital ads arena. A massive 32 percent boost in ad revenue is expected this year, which will enable Facebook to make further inroads into Google’s traditional dominance in the U.S. and indeed, globally. If these projections materialize, Google’s share of the market will diminish to 40.7 percent, while Facebook’s share will rise to an imposing 19.7 percent.

Key to Facebook’s growth is the robust performance of its auxiliary services, notably Instagram. The report indicates that this popular image-sharing platform is projected to contribute 20% of Facebook’s U.S. mobile revenue this year, marking an increase from 15% in the previous year.

In an exciting development, Facebook-owned messaging service WhatsApp is also contributing to the company’s mounting digital ad revenues, with the announcement of a new feature that allows businesses to message customers directly.

While Facebook and Google thrive, Twitter is set to lose ground, with a predicted 4.7 percent fall in their digital ad revenue this year. Contrastingly, Snapchat might witness an astounding 158% boost in ad revenue to $770 million in the U.S., and is forecasted to reach a revenue of $2.2 billion by 2019.

Digital ad revenue made up a whopping 84 percent of Facebook’s total revenue last year, a fact that supports some arguments that Facebook and Google are evolving into media companies. Yet this perspective largely overlooks the core tech services offered by these two internet behemoths.

Armed with a diverse array of highly successful platforms such as Messenger, Instagram, and WhatsApp, which boast a combined user base of nearly 2.5 billion, Facebook possesses the necessary tools to continue chipping away at Google’s share in the U.S. digital ad market. Facebook’s rising clout in the market underlines its continuous evolution as a leading player in this increasingly competitive arena.