Advertising through Facebook
The advertising market is crucial to the success of many different companies, with many relying on it to provide a foundation for their businesses. Most recently, big marketing brands have been avoiding the advertising platform offered by Youtube as their ads have been appearing alongside extremist videos. Other big advertising companies such as Google and Facebook are powerful advertising engines that can spread information to a broad audience. However, a recent article on the advertising market offered some interesting insight into the advertising power offered by Facebook. Despite some of the controversies surrounding Facebook’s measurement errors and advertisements, much of the negativity has not affected Facebook’s business in the market. As discussed in the article, Facebook offers a unique opportunity for companies to reach out to such a wide audience and target specific consumers. More specifically, Facebook has around 2 billion users with the ability to target and persuade consumers through hypertargeting. This has continued to fuel Facebook’s advertising business, as companies have no alternative for the efficiency and effectiveness of Facebook’s marketing.
With the discussion of some of Facebook’s measurement errors, the article offers insight into how advertisements actually pay for these ads. These methods closely match those discussed in lecture, with advertisers paying under a price per click system. In the case of Facebook, this also also extends to a price per view system since some advertisements are played as a video. The issue that arises is in Facebook’s error in counting views, as they inadvertently count views when videos were playing in the background. Thus, many companies have been overcharged for their ad spaces. However, the interesting point here is that this does not deter companies from coming to Facebook to purchase ad spaces. This suggests that many big name companies have a high value per click for Facebook ad slots and also that Facebook has a large command over the advertising industry. Many brands have likely reduced their value per click for a Youtube slot as many do not want to be associated with the inappropriate content that may be shown in certain videos. The topics discussed in class about the advertisement market directly correlate to the ongoing issues with advertising companies.
http://www.businessinsider.com/why-the-advertising-industry-believes-that-facebook-is-invincible-2017-11