2 New Surveys Point to Facebook's Continued Growth

Facebook For Business is building upon its value proposition for marketers. Image source: Facebook

Facebook‘s (NASDAQ:FB) growth has been well-chronicled. On the back of strong advertising revenue, which now comprises 95% of Facebook’s revenue haul, the company has grown its top line 40% on a year-on-year basis through the first half of this fiscal year, pulling in nearly $7.6 billion in revenue versus $5.4 billion in last year’s corresponding period.

From an operational standpoint, perhaps the biggest development for Facebook over the last year or so has been the tremendous growth in its native video hosting platform. Earlier this year, the company boasted its service had surpassed 4 billion daily video views, up from 1 billion in September 2014, putting Alphabet‘s YouTube firmly in its sites for video-hosting supremacy.

Facebook’s video growth hasn’t always been smooth: The company has had a contentious relationship with content creators that fill YouTube, as Facebook seemingly lacks a defined revenue sharing policy and a firm policy to prevent “freebooting.” However, the news as it relates to advertisers is decidedly more optimistic.

Facebook’s real customers — advertisers — are seemingly not concerned
Facebook’s real customers, as in who actually pays the company, seem unconcerned with these issues. Interestingly enough, a new survey jointly published by analyst firm RBC Capital Markets and advertisement-related publisher Ad Age found Facebook tops YouTube among advertising professionals from a return-on-investment standpoint.

According to the survey, 11% felt Facebook’s video ads were significantly better than YouTube, while an additional 25% that felt ads on the platform performed somewhat better. On the other hand, only 6% and 15% felt YouTube ads performed significantly and somewhat better, respectively.

And that’s important as advertisers look to transition their ad spend from television (more on this later) to digital video ad spend. eMarketer predicts 2015’s digital video ad spend to increase to $7.8 billion, up 34% on a year-on-year basis. The company expects growth to slow to 12.1% in 2019, topping $14 billion in 2019. If Facebook is able to offer a better ROI — or simply a better perceived ROI — this could be a boon to shareholders.

It’s not just YouTube that should be worried about Facebook
However, YouTube may not be the one with the most to lose in eMarketer’s data. In the end, it may be television and the supporting monetization chain that get hurt in the upcoming years. Nielsen (via Ad Age) portends future struggles for networks with two highly coveted demographics.

Per the study, in a typical month, 14.2% of millennials can be reached with Facebook only, versus 12.2% who can be reached using TV only (TV is defined as the top 10 networks). For Hispanics, those numbers are 17.5% and 16.3%, respectively. Overall, a combination of TV and Facebook still is the best way to reach these two groups, but if a mutually exclusive marketing decision occurs, Facebook could further win ad spend.

On a demographic basis, Hispanics and millennials are two highly coveted groups, as they are expected to grow in both population and in spending power. In addition, both groups are younger than the median age of the U.S. population (one by definition) and are growing more rapidly than other demographics as well, according to Ad Age. If Facebook is a better outlet to reach these consumers, through video and other ad-based delivery, eMarketer’s estimates of digital ad growth could be low and Facebook’s top line could continue to grow at its rapid clip.

The next billion-dollar iSecret
The world’s biggest tech company forgot to show you something at its recent event, but a few Wall Street analysts and the Fool didn’t miss a beat: There’s a small company that’s powering their brand-new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early in-the-know investors! To be one of them, just click here.

Jamal Carnette owns shares of Apple. The Motley Fool owns shares of and recommends Alphabet (A and C shares), Apple, and Facebook. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

2 New Surveys Point to Facebook"s Continued Growth

Marketing surveys have got my number

Feeling a bit melancholy today, my good friends here in the Old Line State? Well, it’s not surprising, considering that Maryland ranks 24th on WalletHub’s 2015’s Most and Least Happy States in America. We fall right in middle, with Utah topping the list as the happiest state and neighbor West Virginia the unhappiest. And I thought it was just me.

Every week, I get a couple of these kinds of survey results in my email, often from WalletHub, a financial company that offers “the tools and information you need to make the best financial decisions and save money,” according to the company’s website. The messages are often buried in what I call the daily email dump I receive, which is on average about several hundred a day, everything from inner-office correspondence to notes from folks in the community to mostly what I would consider junk mail from marketing types whom I’ve never met. With this number of emails to read, no wonder they have me pegged as moody.

Marketing folks love to put us in categories. And we, as consumers, love to let them do it. Of the email surveys I receive, usually one or two a week comes from the good folks at WalletHub or some other survey-based group that wants to let me know of some obscure or even esoteric ranking of states or cities in this country.

WalletHub is usually the most consistent for this, at least in my email. In the last several weeks, I’ve found out that Maryland also ranks 18th on the list of the best state to have a baby and Baltimore ranks 76th on the list of recession recovered cities and 84th best city for pet lovers. All from a financial perspective and all measuring key metrics as they pertain to money. But they aren’t alone in letting us know where the region ranks.

Another group, Estately Blog, a house shopping website, dropped an email recently to point out that Maryland is the fifth friendliest state in the nation for redheads, a finding that understandably would make my ginger-haired daughter happy. The criteria here is based on the fewest number of sunny days for these fair-skinned folks, social media interest in redheads and the population’s preference in Gilligan’s Island’s Ginger over Mary Ann. Hard-hitting criteria obviously.

Facebook is big on this. If you’re on the social media site much at all, you’re asked to take part in surveys all the time.

Today, my page is asking me to weigh in on who won the Republican debate last week. For that, I’ll pass. Not because I don’t have an opinion but more because I don’t want that opinion used to help pigeon-hole me for some marketing or advertising campaign.

Truth of the matter is, you can’t help surrendering some details. Every time you go online now, the site tries to track you so that it can serve you up ads that are in step with your interests. But, as much as I hate to admit it, we are pretty easily stereotyped, at least in some broad sense. If there’s a sports-obsessed, classic-rock-loving, Chinese-food-eating, middle-aged-male category, some marketing type has got my number.

Honestly, though, I enjoy what the marketing world thinks of me. Quite often, it’s better than reality.

Paul Milton is the Times editor. Email him at pmilton@carrollcountytimes.com.

Copyright © 2015, Carroll County Times, a Baltimore Sun Media Group publication | Privacy Policy

Marketing surveys have got my number