It is becoming extremely difficult for advertisers to decide which platform to use for airing campaigns as competition between Google Inc (NASDAQ:GOOGL) and Facebook Inc (NASDAQ:FB) in terms of what they offer continues to be stiff. CNBC’s, Ari Levy, believes the two tech giants have created a duopoly in the market with a 49% market share on digital ads and a 52% market share on mobile ads.
Advertising and creating brand awareness on Facebook Inc (NASDAQ:FB) and Google continues to thrive thanks to rich data about consumers that can be used for targeted advertising at the disposal marketers. The massive potential audience that marketers stand to attract also continues to be another attractive feature with the two platforms.
“[..] Those two companies have all these information about you and they are tracking you everywhere you go on the web and the device. That’s incredibly powerful data for marketers, and frankly nobody else has got that. So everyone is trying with very valuable web properties to get web marketers to their side and to give them the kind of data and the kind of reach that they want,” said Mr. Levy.
The inflated advertising prices on Facebook and Google Inc (NASDAQ:GOOGL) could, however, work to their disadvantage as small businesses opt to shift focus to other cheap options of the likes of Twitter Inc. (NYSE:TWTR) able guarantee the same value. However, Levy expects large corporate brands to continue using Google and Facebook Inc (NASDAQ:FB) based on the massive audience offered by the two advertising juggernauts.
The small players may continue to carve out niche markets in the advertising business as Facebook and Google Inc (NASDAQ:GOOGL) shift focus to clients willing to pay top dollar to have their campaigns hosted on the platforms. However, Pivotal Research analyst, Brian Wieser, believes most of these small players will always hit a wall as effective marketing tools something that usually scares a lot of advertisers. Giving Facebook Inc (NASDAQ:FB) and Google an advantage in the business.
The advantage that Facebook Inc (NASDAQ:FB) and Google continue to enjoy in the business makes them worthy investments in terms of their lucrative advertising business compared to Twitter, which may not guarantee sustained growth.
“Twitter has a wonderful business, they have a different offering, it is totally different medium when you compare to what Google and Facebook can do. The problem comes if you think that Twitter can do exactly what Facebook Inc (NASDAQ:FB) and Google does, and your expectation is that they can sustain growth, that’s totally unrealistic,” said Mr. Wieser
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