Google Inc. (NASDAQ:GOOG) has been in a dogfight with Facebook Inc. (NASDAQ:FB) in the world of online advertising, which has been highly competitive. And while neither company even has 20 percent of the market share – which continues to grow annually – a recent study says that Google may become the leader in online advertising by the end of 2012.
Market research firm eMarketer said in its report this week that Google Inc. (NASDAQ:GOOG) should own 15.4 percent of the total online advertising market, which would be enough to top Facebook Inc. (NASDAQ:FB) for the top spot. In 2008, Google owned a little more than 12 percent of the digital display ad marketplace. The report predicted that Google would increase its market share to 18 percent by end of 2013. Facebook Inc. (NASDAQ:FB), by comparison, should have 14.4 percent of market share at the end of 2012 and will grow over the next three years, though not as quickly as Google.
Yahoo! Inc. (NASDAQ:YHOO), by the way, which at one time was the leader in online display advertising, has fallen to third with about 9.3 percent of the market by the end of the year – a number attributable to dropping audience on its Web sites.
The biggest reasons cited in the report for Google Inc. (NASDAQ:GOOG) increasing its lead in digital advertising are its YouTube audience and its success in mobile advertising – which has been a well-known bugaboo for Facebook Inc. (NASDAQ:FB).
“The overall forecast for display has been slightly reduced from the previous forecast to reflect the mix of lower prices for display advertising on ad networks combined with the reluctance of some major brands to make extra-large investments in digital display advertising,” the eMarketer report stated.
Google Inc. (NASDAQ:GOOG) has had quite a reach in advertising online, and it has shown to grow steadily over the last few years. If the report is remotely accurate, investors in Google stock – like hedge-fund manager Chase Coleman of Tiger Global Management LLC, for example – will likely see good numbers as Google market share grows alongside the growth of the advertising space on the Internet.