Mobile advertising is dominated by two giants, Facebook and Google. In fact, 85% of mobile advertising spend goes to those two channels, and they both now identify mobile as a primary area of importance for future growth. Facebook’s mobile revenue is projected to grow by more than 50% year over year, with Google’s growing at a healthy 20%.
How did Facebook and Google come to dominate the top of the mobile ad food chain? For starters, each boasts a network of more than a billion daily users. This enables both companies to offer high-quality targeting at a massive scale that most other channels can’t replicate.
Facebook predicted early on that highly targeted app installs would be popular with advertisers. It guessed correctly, and now Facebook’s mobile ad practice fuels more than 80% of its $5.2 billion annual advertising revenue stream. Meanwhile, Google has long been the dominant player in search advertising, which makes up the bulk of the $19 billion it earns in advertising revenue. Mobile is playing an increasingly important role as more than half of Google searches are now done on mobile, which some analysts estimate account for more than half of Google’s ad revenue.
Despite such dominance, marketers run the risk of relying too much on these two networks to deliver the marketing results they need. Advertisers can’t accurately see into the walled gardens that these giants create, and that lack of transparency can create problems for non-diversified ad campaigns—such as finding out that metrics are being artificially inflated.
Using Facebook or Google isn’t a bad plan: Whether they’re running broad campaigns or precise targeting, most advertisers on mobile will find Facebook and Google to be effective. But marketers who also seek the help of other players in the market will be more successful in the fight for mobile customers.