Social Media Projected To Lead Global Ad Spend In 2021

To drive brand recall and favorability, Twitter is also experimenting with branded likes, which should be widely available later this year, according to the company’s Virtual Analyst Day on Feb. 25.

For Facebook, Apple’s IDFA Hurdle Not as Bad as Feared

The consensus estimate for Facebook in Q1 is $23.6 billion in revenue, up 33% YoY.

Facebook struck a cautious tone in its Q4 report. CFO Outlook Commentary warned that the company continues to face significant uncertainty. The business benefitted from two trends that played out during the pandemic: a shift towards online commerce and a shift in consumer demand towards products and away from services, according to the CFO Outlook Commentary.

These trends provided a tailwind to Facebook’s advertising business in the second half of 2020, due to the company’s strength in products and low exposure to services such as travel. A reversal in 2021 of one of both of these trends could be a headwind to advertising growth, according to the commentary.

In January, retail sales were up 5.3%, with every major category of spending seeing gains. In February, retail sales dropped by a seasonally adjusted 3.0% and rebounded 9.8% in March.

Retail sales are expected to continue growing strongly in April and May, according to Kiplinger’s, which said all sales categories are benefitting from the surge and have surpassed pre-pandemic levels, except for restaurants and department stores.

In 2021, sectors that restricted advertising the most due to the pandemic are set for the biggest recovery, with ad spend in travel and transport forecast to grow by nearly 30%, according to the report by Dentsu.

 [BK1]Great idea putting Facebook at the end. Most people will read this for SNAP and PINS

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Like other winners of the Covid economy, Facebook will face tougher comps in the second half of 2021. However, the company expects total revenue to remain stable or modestly accelerate in the first and second quarters.

“We continue to invest to improve our exposure and travel—sorry, in service areas like travel,” said Facebook CEO Dave Wehner. “But our expectation would be in 2021, we’ll continue to have a similar skew towards products as we’ve had in the past.”

Executives anticipated high opt out rates due to privacy changes from Apple, which attacks Facebook’s core advertising business on iOS. If all personalized ads went away, small businesses would see a 60% cut in website sales, according to the report. 

However, the opt-in rate for the default Apple pop-up was 73%, according to a report by Adikteev, an app reengagement platform, which conducted an experiment with thousands of random users in 10 countries from July 22 to August 5.

For Facebook’s ad auctions, pricing depends on impressions. Impression growth slowed in to 25% in Q4 from 35% in Q3. Executives expect that trend to continue into Q1 2021.

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