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Online display advertising broadly consists of banner ads, image ads, and video ads.
Facebook advertising enables advertisers to place text and image ads within Facebook’s social media platform. Facebook ads are a type of online ads that let advertisers target their audiences by variables like age, location, birthday, hobbies, etc. Learn how to advertise on Facebook here!
The Google Display Network is the world’s largest display advertising network for placing banner ads on Google web properties (such as YouTube, Blogger, Gmail, etc.) as well as a network of over 2 million other web sites (eg: USA Today, NY Times, etc.). The Google Display Network was formerly known as the Google Content Network.
Google Display Ads are advertisements placed on Google web properties (YouTube, Gmail, etc.) and Google partner sites. Google search ads are text ads that appear in Google search results, alongside organic search results.
There are a number of unique advantages in using Google Display Ads. While Google search ads are great for reaching potential customers with a clear intent who are further along in the buying cycle, they are plain text, making it difficult to stand out. Google Display Ads allow for advertisers to create more appealing ads, increase brand awareness, and extend their reach to new potential customers they may not normally interact with.
Google notes that:
CTR is generally lower on the Display Network than on the Search Network because people behave differently on Display Network pages than they do on search sites. Users on Display Network pages are browsing through information, not searching with keywords.
Despite having lower CTR than Google Search ads, Google Display Ads’ CTRs still outperform Facebook ads’, and have solid conversion rates.
Google Display Network allows for remarketing, which drives conversions and increase brand awareness. Google Display Network ads also give advertisers a wide array of targeting and ad format options, in addition to helping advertisers reach new customers and extend their reach.
Creating a Facebook Business Page is a free feature Facebook offers, enabling businesses to interact and engage with customers on a more personal level. Facebook users can visit a businesses’ Facebook page and “like” them, participate in contests, write on their wall, etc. Facebook advertising lets advertisers extend their influence to Facebook users who may not yet be fans or have previously interacted with the brand.
While business have noted that engaging in Facebook advertising often raises the number of likes a business’s Facebook page receives, it rarely results in conversions.
General Motors recently announced they would pull their $10 million dollars worth of Facebook advertising because advertising on Facebook was not delivering the ad performance they hoped for. GM realized that people simply aren’t looking to purchase cars when they are on Facebook.
Facebook advertisers have a few different ways to manage their Facebook advertising budget. Businesses advertising on Facebook can decide if they would rather pay on a cost-per-click (CPC) or cost-per-impression (CPM) basis. They can also set a daily budget with a maximum amount they are willing to pay each day, with the ad shutting off once your daily budget it reached.
Advertising on the Google Display Network, advertisers can pay on a CPC and CPM basis, but can also pay on a CPV (cost-per-view) and CPA (cost-per-acquisition) basis. Google advertisers can also set daily budgets that can be adjusted when necessary.
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The Google Display Network extends a business’s advertising reach to potential customers that might not normally seek them out with Google search. With Google Display, advertisers can place their Google ads on other websites that are relevant to what you are selling.
Google Display is the world’s largest display advertising network, comprised of Google properties like YouTube, Blogger, Gmail, and 2 million other partner websites. Because of this, the Google Display Network reaches 90% of internet users, bringing in 180 billion ad impressions each month.
One of Facebook’s big advertising disadvantages is that there isn’t much room for extending advertising reach, since Facebook ads only exist in the Facebook platform. However, Facebook is the world’s largest social network, comprising over 845 million monthly active users. This enables Facebook to reach 51% of the internet and generate 1 trillion pageviews a month.
Facebook’s Q1 2012 Revenues totaled $1.06 billion, while Google’s Q1 2012 Revenues for the Display Network (excluding their core Google Search business) totaled $2.9 billion. Facebook revenues dropped 6.5% and Facebook Profits dropped 32% from Q4 2011 to Q1 2012. Google Display Network Revenues increased by 1% and Google Display Network Earnings increased by 0.7% from Q4 2011 to Q1 2012.
While Facebook advertisers have more page views, their CTRs are low and have a less of a reach across the internet as a whole since their ads only exist on Facebook. Ads on the Google Display Network have higher CTRs and a broader reach.
In the USA, the typical CTR for a display ad is just 0.01% – that means that the ad gets clicked on 1 time for every 1000 impressions. This applies to the average banner ad on any site in the USA.
While Facebook itself doesn’t publish its average Click-Through-Rate, independent research from Webtrends reviewed more than 11,000 Facebook campaigns and determined that the average CTR for Facebook ads in 2010 was .051%.
The average CTR on the Google Display Network is .4% –almost 10 times as high as a Facebook ad.
The average CTR on the Google Search depends on your ad position but can be as high as 30%. An average CTR on Google Search ads is around 2-3%, almost 10x more than The Google Display Network, and almost 100x higher than a Facebook ad.
Why? It may be Facebook’s relatively slim offerings in terms of ad formats and targeting options, which are the key for driving ad relevancy and CTR. Another possible explanation is intent – people may be less responsive to banner ads within a social network than when using other types of websites.
Most conversions come from advertising with PPC on Google Search, but an average of 20% of conversions obtained by Google advertisers come from the Google Display Network.
The average Google Display CPC is $0.75. note that CPC’s vary wildly based on targeting options and advertiser competition
Facebook’s average CPC is $0.80, although Facebook’s CPCs can vary dramatically depending on targeting options and competition levels.
Facebook advertising prides itself on the unique targeting options possible because of Facebook’s collection of personal data. Facebook’s user data enables advertisers to target ads based on users’ education, workplace, and likes, among others. Facebook also allows for demographic targeting and location targeting.
Like Facebook, Google’s Ad Targeting options include demographic targeting and location targeting. In addition, the Google Display Network enables advertisers to implement remarketing, interest and topic targeting, and keyword contextual targeting.
Facebook doesn’t offer mobile advertising (a huge hole, especially with mobile use growing so fast), retargeting (or remarketing), advertising on partner sites, or keyword-based contextual targeting options for display ads. Google offers all of these.
On Facebook, a monthly active user is defined as a user who has visited the website in the last 30 days.
Google AdWords remarketing, conducted through the Google Display Network, allows advertisers to show ads to users who have already visited their site while browsing around the web. Remarketing, also known as ad retargeting, can extend brand awareness, bring in customers that might otherwise be lost, and can dramatically increase your ROI.
Google notes that Yankee Candle used remarketing on the Google Display Network to re-engage shoppers, increase conversion rates by 600% and cut cost-per-conversion in half. While this case study was provided by Google, it’s been shown that many businesses find success with remarketing.
Keyword contextual targeting allows advertisers to use keywords to find relevant web pages for your ads across the Google Display Network.
Topic and interest targeting lets advertisers target their ads to users from pre-defined interest categories inferred from user browser history.
Demographic targeting enables advertisers to target ads based on a user’s specific age or estimated age range.
Location targeting is used to target ads based on user’s geographic location.
Facebook offers only two ad formations: the standard Facebook ad (text plus an image), and a relatively new format, sponsored stories.
Google offers a wide range of ad formats for advertisers on the Display Network. Google’s display network ad format options include text ads, image ads, flash-based image ads, in-video ads, ads for mobile web and mobile games. The mobile ad formats are still a work in progress, as advertisers disagree on whether a tablet should be considered a desktop or mobile device, but Google has currently voiced their belief, through the launch of enhanced campaigns, that mobile shouldn’t be defined by device, but by time and location. Time will tell whether Google’s mobile ad strategy will work.
Google Display Image Ads come in a variety of sizes:
While Facebook has basic reporting tools to review impressions and clicks, Google Analytics is vastly superior and more in-depth.
Facebook exists primarily as a social media platform, so the user experience is absolutely paramount. Mark Zuckerberg doesn’t want the advertisement to impede on the user experience, so ads are kept minimal and unobtrusive.
While users go to Facebook to chat with friends and have fun, users go to Google web properties and partner sites for a wide variety of reasons, possible to conduct research for upcoming purchases. This makes it appropriate and reasonable to have ads play a larger and more prominent role across Google properties and partner sites.
Facebook’s wealth of user data is immensely valuable, and while it does allow advertisers to target niche groups that might normally bring in better Click-Through-Rates (CTRs), targeting doesn’t change the fact that Facebook is primarily used for social, fun activities. Very users go to Facebook for purchasing decisions, and so ads go largely ignored.
Facebook has an impressive global reach, giving it the potential to be as much of an advertising powerhouseh as Google. But the real question is, does Mr. Zuckerberg even want Facebook to be an advertising-based company? Zuckerberg has been quoted as saying:
Facebook was not originally created to be a company. It was built to accomplish a social mission – to make the world more open and connected … Simply put: we don’t build services to make money; we make money to build better services.
While filling your site with advertisements isn’t the “cool” thing to do these days, Zuckerberg can’t ignore that 85% of his revenue is driven from internet advertising. Advertising is his business model, implementing better advertising on Facebook will ultimately determine how much Facebook as a company is worth.
Facebook advertising does have the potential to compete with Google advertising, but it all depends on how Mr. Zuckerberg chooses to handle advertising on the biggest social media platform in the world.
It’s difficult to say—updating Facebook advertising is essential if Zuckerberg wants Facebook to create revenues that will impress and please sharehoulders.
In the great Facebook vs. Google competition, it is essential that Facebook offers a larger variety of ad formats to match the Google Display Network’s many options.
You can learn more about Facebook ads in our Facebook’s business ads guide. Or, find out how your current Facebook Ads are doing using our free Facebook Grader Tool.
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