Although the battle between Google and Facebook may not be as heated as the Press often makes out, when it comes to market share the two companies are competing for the same thing: ad dollars and eyeballs.
Google, the king of search, often uses its search might to prove the value of its brand and draw attention away from anything which might question its might. Facebook does the same thing with the undeniable might of 800 million users in its membership and, according to Comscore research, the stickiest website on the planet with visitors spending the lion's share of their time there.
Each company, in turn, paints the other in less than flattering light and, obviously, see themselves as the only natural focus of the online population's time. While casual web surfers can afford to be partisan in their choice of social network and company behind whose services they can throw their weight, internet marketers owe it to themselves to have a less partisan approach and a better grasp of the bigger picture.
The real question for those who spend time and effort marketing online, or advising those who do is not who is 'better' Facebook or Google+ or which company is really bigger but which one is performing best. Performance, as any actuary will tell you, is guided by facts, which are guided by numbers, which are in turn governed by mathematics. There is very little room there for warm and fuzzy feelings, which is why it then becomes the best basis for second guessing which company to use most and which one to advise your clients to pay most attention to.
In the numbers game Google appears to be well ahead: The company just announced that in the third quarter of 2011 Google came its closest to the $10 billion mark, profits were up by a whopping 26% (the second quarter in a row where they beat expectations), hiring continued with an extra 2,585 employees added to the company's workforce and, in a year when Google pulls out all stops in marketing and launches a social network, costs were below what was expected suggesting that the company is managing its accelerated growth so tightly that it also controls costs.
Google's other products also continued to grow with Android OS present in over 100 million devices worldwide, Google Plus had over 40 million users and Google Chrome, Google's own browser, had over 200 million users. These numbers are important because they show that while Google was focusing on growing and expanding its core search business it also put a lot of weight behind all its other initiatives. Combined with the fact that costs did not rise it provides a picture of a company firmly focused on its goals and with a clear grasp of where it's going.
Facebook, of course, is not yet a public company so its numbers are harder to come by and even harder to verify accurately. We do know that during the first quarter of 2011 they missed their earnings target by $500 million dollars (not huge in itself but considering that this is the largest social network on the planet it is significant), they have since, lost 6 million users in the US (June 2011 figures) and its proposed IPO, scheduled for some time next year, labours under the shadow of the Goldman-Sachs fiasco where shares were offered and then withdrawn.
In 2009 Facebook reported a $200 million profit on revenue of $777 million. The following year it reportedly made $2 billion in revenue and a cool $400 million profit (a percentage slowdown by about 5% from 2009 but a still respectable 20% profit margin). Provided that gains can be maintained the 2011 numbers should deliver $5 billion worth of revenue and about $1 billion worth of profits. But here's the catch, Facebook is growing and changing rapidly and when you get the combination of growth and change you usually tend to lose focus and lose control of costs (Microsoft can verify that with BING costing it $3 dollars for each $1 it brings in).
Loss of focus often leads to loss of product vision (it happened to Google with Google Wave) and here Facebook has had a year and a half of fails: Facebook Gifts was discontinued in 2010, Facebook Lite (available for mobile) lasted just eight months, Facebook Deals (designed to capitalize on Groupon's success) was cancelled after just four months, FBML (Facebook's mark-up language aimed at businesses) has been discontinued after businesses invested heavily in creating professional business pages, Facebook Places (a direct competitor to Google Places) was killed, Facebook Messages (and Facebook's attempt to produce a 'Gmail Killer') fizzed and is in limbo land and Facebook Lists and Facebook Groups is not growing.
The picture revealed here is important because when it comes to spending time, effort and money the smart internet marketer needs to put money where it will count the most. Right now, the smart money is with Google.
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