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Is Facebook Ready To Take On Google Adsense?

Google Adsense is an internet advertising juggernaut.  Every fiscal quarter, Adsense generates billions of dollars in revenue for publishers, advertisers and of course Google.  This smart, auto-targeted pay per click advertising network not only revolutionized online advertising, but it revolutionized content publishing as well.

Adsense allowed content producers to efficiently monetize their websites without the trouble of seeking out advertisers, negotiating payment, and implementing a system to serve the ads.  Because of this, Google Adsense has dominated as the biggest internet advertising platform for the last 10 years.  However, it’s become clear in recent years that Facebook is in a position to take a run at Google’s ad network dominance.

Why Facebook Needs To Take On Adsense

At the moment, Facebook’s revenues are disappointing given its massive market evaluation.  Sure, ads on Facebook’s social network contributed significantly to 2011 revenues of 3.7 billion dollars, but Google Adsense generated 2.88 billion in just the 4th quarter of 2011.  Given that Facebook has nearly a billion users, significant revenue growth through new user acquisition simply isn’t realistic given the sheer number of existing users.  But if Facebook can grab a significant piece of the much broader display advertising market, Facebook will be able to massively grow its revenues over the next couple years.

Why Facebook Might Succeed

Facebook Like Button

Webmasters and bloggers are already used to putting up the Facebook like button on their webpages.  Not only does the Facebook like button offer a great way for webmasters and bloggers to gain visitors, but Facebook has been using the like button as a way to gather data on the web surfing habit of its users, as well as anyone who visits a website with a like button.  With nearly a billion users all being constantly tracked by any webpage with a Facebook like button, Facebook’s web data mining operation rivals Google’s.

Facebook Has The Data

The brilliance of Adsense was that it analyzed the content of a webpage as well as a user’s web surfing history to serve up targeted, relevant ads.  Before this, advertisers would simply buy ads by the thousands on various websites and networks, praying that they could generate enough sales to make up for the inefficiency of online display ads.  Adsense’s smart targeting technology changed the game, boosting both advertiser profits and publisher revenues.

When it comes to actual personal, demographic data, Facebook’s social networking data arguably gives them an edge up on Google.  The detailed data Facebook has from its social network, alongside the Facebook’s like button which tracks user surfing habits around the web, could be used to build a powerful new ad platform.   By combining the data it gathers from its social network as well as its tracking of its web surfing habits, Facebook has the data to create a content advertising platform that is just as targeted – or even moreso – than Google Adsense.

Why Facebook Could Fail

The biggest obstacle facing Facebook are its public relations battles with regards to privacy.  While Facebook may be the only other tech company with the massive demographic and targeting data to rival Google, their massive influence in the personal lives of its users has made it a target for privacy advocates around the world.

Will Facebook Try To Take On Google Adsense?

While Facebook has continually denied plans to launch an offsite ad network to rival Google Adsense, they’ve recently changed their privacy policy to permit serving targeted ads to users while they’re away from Facebook.com.  Facebook has also been displaying ads on Zynga.com, which many interpret as a test run for its eventual ad platform.

When you combine this with the sheer size of the ad network market, and Facebook’s positioning in terms of technology and data, it’s a simple matter of time before Facebook launches an attack on Google Adsense’s market dominance.  Will they succeed?  They certainly have all the tools, but only time will tell.

Author Bio:- Nat is SEO professional as well as a blogger and occasional freelance writer.  Nat can often be found blogging as well as testing and reviewing webhosts at Whoishostingthis.com.  You can find more of Nat’s work at their site.

{ 3 comments… add one }
  • Browse

    August 18, 2012, 10:54 pm

    I still having hard time to get a google adsense account. But I’m working on it. Facebook somehow bacomes a part of netizens day by day.

    Reply
  • Adil

    August 19, 2012, 10:37 pm

    Nicely elaborated and well analysed article. I hope that Facebook starts any competitive ads campaign in comparison to adsense, because Adsense is not going to approve my a/c in any case. 🙂 hahaha

    Reply
  • Chris

    August 20, 2012, 1:25 pm

    The problem is that facebook needs to first prove that it could work, doing this would be harder than it looks due to some inevitable initial antagonism.

    Reply

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