In lieu of the recent news about the Facebook smear campaign against Google, it seems that Google may be poised to remain the top dog in online ad spend this year. Last week, the story regarding Facebook hiring PR firm Burson Marsteller to spread lies about Google’s new “Social Circle” went viral. The war over the social graph, a data set of information about the social networks users are connected to, is in full force.
However, Google isn’t even flinching. According to Fortune, Google’s Eric Schmidt insisted that Microsoft, not Facebook, was the true competitor to Google. He said, “Facebook users tend to use Google Search. Facebook’s ads business does not displace our advertising. I’m somewhat perplexed by the obsession because I don’t think the facts support it. Things are going great for Google.”

The facts may support that businesses prefer to use Facebook and Google simultaneously; however, the percentage in which they invest their marketing budgets may be a point of competition. It is obvious that Facebook sees Google as competitor in gathering customer data. Google’s mission is to organize the world‘s information and make it universally accessible and useful, and Facebook is plotting something of the same. Ultimately giving marketers invaluable tools to segment and understand populations of people.

Ad Revenue

In terms of online spend, Google is still at the top of the charts, according to eMarketer: Google’s online ad revenue will jump from 38.9% to 43.5% of total online ad spend in 2011. Facebook held 4.7% of total online ad spend in 2010 and are growing relatively faster than Google. They are expected to take 7.7% of online ad spend in 2011.
Small businesses still haven’t come to terms with Facebook ads quite yet. Opinions on Facebook ads label them as a branding tool. The question of whether Facebook-ers are in a buying behavior is still looming, and just because a Facebook user has an interest in “basketball” doesn’t necessarily mean that they would even be interested in buying basketball apparel. So for now, Facebook ads are a somewhat harder sell than specific keyword search terms.
So as marketers where do you see your online ad spend shifting? Are you more heavily investing search or social? Both seem like a viable ad platforms for the future, but are they complements or rivals?
Image Credit: inkity

About the author: Matt Krautstrunk is an expert writer on everything from social media marketing to time and attendance systems based in San Diego, California. He writes for Resource Nation, an online resource that provides time card software advice on purchasing and outsourcing decisions for small business owners and entrepreneurs.