Posted September 21, 2011 3:05 pm by with 1 comment

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According to eMarketer, 2011 will be a banner year for Facebook with ad revenues rising 104% to 3.8 billion. And though this seems like an excellent achievement, it’s actually lower than the 4.05 they originally predicted at the start of the year.

Debra Aho Williamson, eMarketer principal analyst would like to note that, “This slight revision downward for 2011 should not be taken as a sign that Facebook’s overall business is losing momentum.”

Because by 2013, they’re expecting Facebook to pull in 7.0 billion. I imagine no one over there is weeping over the balance sheet.

This ad portion only represents part of Facebook’s income. When you add in Facebook credits and other sources, the 2011 number climbs to double what it was last year.

What’s interesting is that more people are putting their ads on Facebook, when the results of those ads still aren’t clear.

Says Williamson,

“Even though Facebook has spent several years wooing marketers, many of them still believe the ads aren’t effective at driving clicks and other actions. Facebook must either work to improve its clickthrough rate or show advertisers that advertising on the site is effective even without a click or other action.”

That last sentence is a big one. I believe that Facebook is a great place to promote branding. Facebook pages have proven to be effective ways of engaging an audience and there’s probably some spill over to ads even if people don’t click. But finding a way to prove effectiveness without having clicks to count is a problem we’re encountering more and more.

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So if we’re not sure about the effectiveness of Facebook ads, why are ad revenues rising? I have to believe it’s another case of “doing it because everyone else is doing it.” And you know what your mom always said about that.

  • There’s no clear way of measuring just how effective FB ads are, but that doesn’t mean that they’re not effective entirely. That’s why it’s not necessarily true that it’s a bandwagon thing. If these brands aren’t getting anything out of it, it’s highly unlikely they’ll keep throwing money on FB ads.