subject: The Google Goliath [print this page] The once impenetrable Internet colossus, Google, has been making some serious missteps in its ongoing battle with social media titan Facebook. Google and Facebook dominate online advertising, but with differing modelsthe former paid search, and the latter display advertising. Though Google is clearly the dominant player, with 65% of the U.S. search market, Facebook poses a real challenge in maintaining that dominance. Thats because of the webs increasing focus on social media. Google has made multiple attempts to launch social networks to steal market share from Facebook, to no avail and Facebook is getting stronger. With Facebooks launch of the timeline for brands, it will offer businesses new and powerful opportunities for reaching consumers.
Display advertising, in the old days, meant the schlocky and annoying banner ads of Yahoo. Facebook revolutionized the model by figuring out a way to monetize social networks, through the analysis of user information to target specific demographics with display ads. As a result of this shift in strategy, these ads have gotten more and more sophisticated, an example of which can be found in the Newsbullet display ad format of online marketer Adblade.com. Ever since, display advertising has emerged as a real threat to the online advertising market share of paid search.
Launched in December of 2004, Orkut was Googles first attempt at a social media brand, in response to the growing popularity of then dominant Myspace and fledging Facebook. Based on social networking pioneer Friendster, Myspace was launched in August of 2003, Facebook in February of 2004. Considered the top dog of social media until 2008, Myspace users loved its focus on music and bands, and the page customization ability of its user profile. But Myspace failed to innovate and fix major issues with speed and spam. Facebook took advantage of those vulnerabilities with a clean interface design that enabled users to browse much more quickly and easily. Orkut only ever gained real traction in Brazil, where it now operates under Google Brazil.
Googles next attempt at social media, Buzz, was an integration of the functions of Facebook and Twitter. The service launched in February of 2009 and was discontinued in December of 2011, due to major issues with privacy and a shift in focus to Google+. Its public disclosure of users Gmail contacts and sensitive interaction information garnered a great deal of public outrage and the scrutiny of the Federal Trade Commission, which thereafter mandated privacy audits of Google for the next twenty years.
Rolled out in June of last year, Google+ has over 90 million users, according to CEO Larry Page. In a new report by comScore, Google+ users spent just 3.3 minutes on the site compared to Facebooks 7.5 hours in January. Length of engagement onsite and number of users are clear advantages to Facebook, which now has 850 million users. The social networks walling off of massive amounts of content from the Google search engine poses a serious problem for Google in its indexing ability.
December reports from Enders Analysis suggest that Google+ will remain a bit player in the social media landscape. The next step for Facebook is to enter paid search, which is more a matter of when than if. Facebook would have major advantages in the market if it could apply its demographic targeting to a search engine. Google recognizes this and is throwing massive sums of money at the Google+ network. If it fails, this could be a veritable online David and Goliath story.
