Facebook Facing Off with Google in Online Advertising
Since the inception of online advertising, Google has comfortably held the number one position in terms of effectiveness and total advertising dollars in the digital ad marketplace. Never content to play second fiddle, Facebook has recently announced a full-frontal assault on Google with its recent acquisition and re-launch of Atlas, an advertising platform developed by Microsoft that has been dismantled and rebuilt as a viable competitor to AdWords.
Google and Facebook hold first and second place, respectively, in the $140 billion digital ad market. However, the gap between one and two is vast, with Google holding three times the market share of Facebook.
In the last two years, however, Facebook has been closing that gap thanks to its capture of the mobile ad segment. Each platform makes the bulk of its revenue selling inventory on its own properties, though Google has made a significant impact with its publisher ad networks. The launch of the new-and-improved Atlas will position Facebook to close in on Google’s stronghold, allowing advertisers to access Facebook users outside of the social network’s main site.
Why Should Google Be Concerned
In order to elbow its way closer to Google, Facebook will use the terabytes of data that it has collected from its 1.3 billion users, information that those users have shared willingly and freely with the social network over the years. Ads will be specifically tailored for each user based upon demographics and interests.
Calling this approach “people-based marketing,” Erik Johnson, the head of Atlas stated in a recent release that Atlas will help marketers “reach real people across devices, platforms and publishers. By doing this, marketers can easily solve the cross-device problem through targeting, serving and measuring across devices.”
Additionally, Atlas will be able to connect online campaigns and offline sales, allowing marketers to accurately measure the ROI and the effectiveness of ad campaigns on revenue.
The key to Atlas’s proposed success is three-fold.
First, hyper-targeting based upon relevancy cues will allow advertisers to market only to those consumers likely to make a purchase, unlike Google AdWords which displays ad copy based upon tracking cookies and keyword relevancy.
Second, Atlas will be able to maintain consistency across mobile platforms. Traditional ad networks and remarketing efforts rely on cookies, which don’t work on mobile devices and are ineffective when it comes to accurate targeting and measurement.
Third, Atlas promises to deliver the Holy Grail of digital marketing – connecting online advertising to offline purchasing.
Complex Data, Simple Processes
Facebook plans on serving Atlas to marketers on an easy-to-use platform. Currently, Google advertisers must seek out professionals who are highly skilled and often certified in managing and measuring the effectiveness of Google AdWords. Atlas, on the other hand, will give marketers the ability to target specific users with a straightforward process. Advertisers will have a clear concept of precisely where their ads will appear, and they will have access to supporting data surrounding expectations for success.
With a Google AdWords campaign, marketers aim for the most clicks, and then they must analyze user behavior after the fact in order to make assumptions about the relevancy and effectiveness of those ads. This often amounts to expensive trial-and-error style campaign development. Atlas, however, promises to answer this point of pain by delivering deep analysis and insight into impressions, clicks, conversions, and anticipated behaviors before a campaign launches, letting marketers know whether or not their dollars will be well-spent in the space.
Going Beyond User Demographics
Currently, traditional online advertising relies on basic demographic information to guide placement. Facebook has been sitting on a veritable gold mine of information on its users that goes far beyond age, location, gender, and search history. That data, combined with Facebook’s ability to track user behaviors without the use of cookies, is what will drive the success of Atlas. Facebook will take a user’s demographic information and behavioral profile and allow advertisers to target only those customers who are likely to convert, not just those customers who have an interest in a specific product.
Marketers will also be able to target users who are already in the sales funnel. This means they can display specific ads and offers to prospective customers at specific intervals in the sales process. If a customer is not ready to buy, marketers can target ads that will move them to the next phase of the sales cycle, rather than bombarding that customer with buying messages that are ill-timed or irrelevant.
Offline Purchases: The Holy Grail of Online Marketing
The biggest downfall of online advertising platforms has been the inability to connect digital ads with offline purchases. There has never been a reliable method in place for tracking exactly how online advertising impacts in-store buying behavior. To date, brands have had to rely on complex formulas and algorithms that amount to little more than highly-educated guesswork.
Atlas is promising to deliver this elusive Holy Grail to advertisers. Because it does not rely on cookies, Atlas will have the ability to pair a customer’s mobile identity with their desktop identity. Brands will be able to provide Atlas with a list of email addresses of customers who have purchased their products within a specified amount of time.
Atlas will then cross-reference the list with Facebook users who have seen that brand’s ad within a specified amount of time. From there, Atlas will calculate the percentage of users who saw the digital ad and made an in-store purchase.
The Inevitable Privacy Concerns
Since Atlas will not operate on cookies, many marketers’ next logical question is, “How does it track user behavior?” The answer? Facebook IDs. Tracking users based on this criteria is what allows Atlas to follow users across any device that is connected to that individual’s Facebook ID.
While this is great news for advertisers, it raises the inevitable user privacy question. Cookies, though limited, allow users to browse the web anonymously. Facebook IDs do not. The simple answer for those concerned about privacy is to not use Facebook. However, the social network has become so ingrained in the daily lives of so many people, that Atlas is unlikely to have a significant impact on Facebook user behavior.
Atlas has suggested that the data gathered by Facebook will, in fact, remain anonymous. However, given the amount of access they are promising advertisers, it may leave many users wondering if Facebook operates under a unique understanding of the word “anonymous.” It remains to be seen just how well Atlas will be able to protect users’ privacy.
The Proof Will be in the Pudding
Atlas is promising to be the next big thing in digital advertising. While it is positioned to be a formidable competitor to Google, its success will depend upon its ability to deliver on those promises to brands, and whether or not marketers, who are already suffering from platform management fatigue, are quick to jump on the Atlas bandwagon.
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