Last week’s blog was about Google’s 20th birthday. Having worked there, it was a very significant and emotional blog for me to write just as the company is now very important to the world. A few days later, the question, “How old is Facebook these days?” popped into my head. As it happens, Facebook is 14 years old. This was not idle speculation.
Facebook has made some pretty huge headlines this year. It made the cover of the Economist with the headline ‘Epic fail”. Zuckerberg - himself only 14 years older than Google - appeared before congress to testify about data breaches in the presidential election. On the 26th of July, Facebook entered the record books - not for the first time I imagine - after posting the largest one-day loss in market value by any company in U.S. stock market history after releasing a disastrous quarterly report. That incredible day, Facebook’s market capitalization plummeted by $119bn to $510bn as its stock price fell by by 19 percent. But that is not why I was wondering how old Facebook is.
Day to day news is sensational and fades quickly from memory. The most successful investors in the world - Warren Buffett and Charlie Munger - have done so spectacularly well at Berkshire Hathaway because of their very rare ability to keep their heads while everyone else is losing theirs. I can hear them being asked about the Facebook dip in July and both chiming, “Total non-event for us.” They play the long game and follow trends not headlines. I imagine Zuckerberg does exactly the same thing.
When TMI started in 2008, I don’t remember a single client or colleague asking about Facebook that year. Facebook Ads was unveiled on November 6th 2007 but it was a number of years before I even considered referring to this platform in a pitch. But the trend line of Facebook’s influence in digital marketing is a very fascinating one and considerably more sensational than all of this year’s news put together. Just consider this little set of facts. In 2010, Facebook Ads accounted for 2.9% of global advertising revenue at $1.9bn. In 2017, Facebook Ads accounted for 19.7% of global advertising revenue which translates into $39.9bn. That’s 2,000% revenue growth in 7 years.
So maybe it takes a bit of a knock this year and maybe the growth levels out in 2025. There is no getting away from the fact that Facebook and Google account for 57,6% of global digital advertising. And Facebook is now a big part of TMI’s service offering. Our Facebook team - well it is really our Facebook and Instagram team - is a central part of the business. The tools have become vastly more sophisticated and the integration of machine learning bidding and targeting is impressive. Just to put this into perspective, the next contender - Microsoft - has 3,8% market share followed by Yahoo at 3.1% and Twitter at 1.9%. Happy 14th Facebook. It has been a very wild ride for you too.