Social network ad spending is set to reach over $US25 billion this year and is only set to increase, according to new research.
Market reserach company eMarketer says this is largely down to the increased focus on this area by social networking giant Facebook, which accounts for more than 60% of total ad spending.
In positive news for our egos, this means that we’re becoming more valuable for Facebook, with each user estimated to be worth about $US12.76 in ad revenue for the site worldwide.
Facebook will reach over $US16 billion in ad revenue this year according to eMarketer, up more than 40% from last year.
Facebook’s ad revenue expected to rise by more than 37% by 2017.
Instagram is also playing a large part in the increase, with the photo-sharing platform now accounting for 5% of the total revenue.
As Re/Code reports, user value can be increased by Facebook in two ways: increasing the amount of ads appearing on news feeds, or upping the price of these ads, and it appears both of these methods will be employed going into the future.
While Facebook seems to have found an effective way to monetise its extensive user base, eMarketer says rival Twitter’s ad revenue is slowing down slightly.
“Twitter has improved its ad targeting capabilities, and it still has a lock on real-time conversation,” eMarketer principal analyst Debra Williamson says.
“However, advertisers want to reach a mass audience and that’s harder to do on Twitter than Facebook.”
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Denham Sadler is a former editor of StartupSmart. He was previously a journalist at the publication and has worked as a freelancer for the Guardian, the Saturday Paper and the ABC. In his spare time he likes puns and jaffles.
