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Facebook and Google: Market Share in Ad Revenues

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Mar. 27 2018, Updated 7:32 a.m. ET

Facebook and Google could see declining market share

Alphabet’s (GOOGL) Google and Facebook (FB) have been dominating the digital ad space in the last several years. While the Internet giants continue to earn a significant portion of US ad dollars, a report by research firm eMarketer suggests that other companies are beginning to reduce their dominance.

According to eMarketer’s estimates, Google’s market share in the US digital ad space could decline to 37.2% in 2018 from 38.6% in 2017. Facebook’s market share is estimated to shrink from 19.9% in 2017 to 19.6% this year.

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Amazon and Snapchat are likely to eat up some of the duo’s market share

Amazon (AMZN) and Snap Inc.’s (SNAP) Snapchat, on the other hand, are likely to see a higher share of US ad dollars. eMarketer is projecting Amazon’s share to increase from 2.0% in 2017 to 2.7% this year, while Snapchat’s share is expected to increase from 0.6% to 1.0%.

As the graph above shows, both Amazon and Snapchat are likely to see a higher market share over the next few years. That said, the ad revenues of these companies are a fraction of what Facebook and Google earn.

The research firm suggested that Instagram will now drive Facebook’s total ad revenues, as the platform is seeing robust growth in its user base, while that of Facebook is stagnating.

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