New Research Compares Facebook Advertising to Google Display Network: Who Comes Out on Top?

BOSTON, MA – May 15, 2012 – With Facebook’s initial public offering (IPO) just around the corner, many are wondering if the company can live up to its enormous valuation of approximately $100 billion. Accordingly, WordStream Inc., a provider of search engine marketing software and services, has released new research comparing the value of Facebook advertising to Google’s Display Network – the portion of Google’s advertising business that allows advertisers to place display ads on Google sites such as YouTube, Gmail, and Blogger and over 2 million other websites, including popular news sites, blogs and other niche sites across the internet, rather than alongside search results.

This research is compiled in a new infographic that evaluates Facebook’s display advertising business versus the Google Display Network on criteria including advertising reach, ad performance, revenues and growth, ad formats, and targeting options. Click here to view the full Facebook versus Google advertising infographic.

Results of the study include:

  • Facebook and Google both have huge potential reach, with Facebook boasting 845 million monthly active users and Google owning the world’s largest online display advertising network.
  • The average click-through rate (CTR) of an ad on the Google Display Network is 0.4% – almost 10 times as high as the typical Facebook ad. Average CTR on Facebook is under 0.05%, about half the industry average for online banner ads. At the same time, costs per thousand impressions on Facebook are climbing.
  • The Google Display Network offers twice as many ad formats as Facebook, including in-video ads, mobile-game ads, support for industry-standard image ads, and more.
  • Facebook does not yet support mobile advertising and has more limited targeting options than Google.

The comparison suggests that Google currently offers advertisers more value in terms of both options and results for advertisers, and that Facebook has a lot of catching up to do to provide advertisers with the best possible advertising solutions.

“So far, Facebook’s advertising platform hasn’t kept pace with the explosive growth of its social network, and it remains to be seen if CEO Mark Zuckerberg even wants to focus on advertising as a source of revenue. In his 2,500+ word letter to shareholders this month, he mentioned advertising just once,” said Larry Kim, Founder and CTO of WordStream.

About WordStream

WordStream Inc. provides search marketing software and PPC services that help marketers get better results from their PPC and SEO efforts. WordStream’s easy-to-use software facilitates more effective paid search campaigns by providing a customized workflow, the 20-Minute PPC Work Week, to help advertisers increase relevance and Quality Scores in Google AdWords, follow proven best practices, and get expert-level results in a fraction of the time. Whether you’re new to search marketing or are experienced at PPC management, WordStream’s keyword tools and AdWords management software can help grow your business and drive better results. For more information, please visit us at http://www.wordstream.com