Facebook will 'overtake Yahoo!' in display ad revenues 

Thursday, March 03 2011 by Catherine Ferguson

For the first time ever, Facebook will have the largest share of US display ad revenues, according to the latest research by eMarketer.

The social network has registered an 80.9 per cent growth in display ad revenues over the last year, raising its revenues to $2.19 billion (£1.35 billion) this year, meaning that Facebook is now receiving 21.6 per cent of all US display ad dollars spent.

This desire to have Facebook helping with website promotion means that Yahoo! has since been marginalised, despite eMarketer estimates of the search company earning 16 per cent more with display revenues.

Google display spending share will lie at 12.6 per cent this year, it was added, while the struggling AOL will fall from 5.3 per cent of display ad revenues in 2010 to just 4.4 per cent in 2011.

David Hallerman, principal analyst at eMarketer, said: "Not only will Facebook's display revenues surpass Yahoo!'s this year, Google's revenues will exceed Yahoo!'s next year. What that leapfrogging trend confirms is the strong demand among brand marketers for online display ad placements."

He added: "Even as some observers expect Google's search revenues to fall due to competition from Bing, the reported revenue reality shows that after a relatively slow Q1 2010, net US ad revenues at Google grew by 27 per cent or more each of the following three quarters."

Bing will therefore find it difficult to prevent Google from making impressive search gains, as it will lead to a cyclical effect where search will help its display business and vice versa. This, Mr Hallerman argued, reflects the desire for managed emarketing campaigns to link two ad formats through a single provider.

However, while it is no secret that Facebook is now a big player in the online ad market, eMarketer also revealed in another recent study that in the overall online ad market, Google and Yahoo! remain the front-runners.

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