Facebook Advertising Increases 19-Fold This Year

Brand advertising is skyrocketing on Facebook, up 104 percent in the second quarter of 2011 compared with the first quarter, and up a staggering 1,900 percent versus the year-ago quarter, according to the Global Facebook Advertising Report from TBG Digital.

Brand advertising is skyrocketing on Facebook, up 104 percent in the second quarter of 2011 compared with the first quarter, and up a staggering 1,900 percent versus the year-ago quarter, according to TBG Digital.

Retail, in particular, has seen dramatic growth on the social network, as TBG found that the sector accounted for 36 percent of impressions during the second quarter, after being virtually nonexistent on the site as recently as the third quarter of 2010.

Business-to-business advertising also saw strong expansion, but nowhere near the level of retail.

Other findings from the report — which was mined from data from 167 clients in 21 countries, generating a total of 200 billion impressions:

  • Advertisers saw a 435 percent improvement in campaign conversion rates when targeting their existing Facebook fans.
  • The cost-per-thousand impressions (CPM) rose by 45 percent from the second quarter of 2010 through the same period in 2011, and the cost-per-click went up 74 percent, when using the social approach.
  • The use of sponsored stories on Facebook dropped advertisers’ cost per acquisition by 32 percent.

TBG Chief Executive Officer Simon Mansell said:

TBG works with 100 of the top 500 advertisers on Facebook, and this report contains data from a total of 167 clients. I spend a lot of my time talking to these customers and hear more and more of them telling me they are reallocating budget from offline media to Facebook. I think the numbers in this report back up the anecdotal evidence of my conversations with TBG’s customers: Facebook is the transformational platform that is making advertisers move brand budgets from the traditional areas of TV and press to online.

The takeaway: Ignore Facebook as an advertising option at your own risk, as while it may be facing stiff competition from Google, it doesn’t appear to be going away anytime soon.

Readers, have advertising and marketing campaigns on Facebook influenced any of your purchasing decisions?