Is Facebook the Ideal Platform for International Ads In its latest report, Marin Software showed that while 85 percent of Facebook users live outside the U.S. Mexico and Canada, only 52 percent of advertising is directed towards international consumers. North America receives almost 48 percent of ad expenditure, while Europe follows with 35 percent. Other markets receive much smaller ad targeting and expenditure in proportion to their population of Facebook users. For example, the Asian and Pacific markets comprise 28 percent of Facebook users, but only 0.71 percent of ads are targeting those consumers.
This has led many industry experts to suggest that advertisers seeking to vastly improve their brand visibility in emerging markets like Africa, Asia and Eastern Europe can take advantage of limited competition on Facebook. Because of Facebook’s considerable market penetration in these regions, but little or no ad spend, a small investment can produce outsized returns.
The Marin report goes on to suggest that advertisers eager to enter these rapidly developing markets should take some important steps prior to entry:
- Examine local and international laws
- Evaluate international sales potential and fulfillment capabilities
- Investigate regional demand and anticipate growth requirements
- Utilize local preferences to inform culturally oriented marketing messages
- Customize promotional strategies to each region
- Ensure that language differences are well understood
This overlooked aspect of Facebook’s reach has yet to dawn on many advertisers, but this could be rapidly changing. In part, this new concern about foreign markets is originating with Facebook itself. The recent purchase of the messaging service WhatsApp for $16 billion by Facebook is a signal to the business community that Facebook is keenly interested in raising its presence in foreign markets. Whatsapp has immense popularity in Brazil, Indonesia, India and South Africa, and is seen as a platform to springboard users in those regions to join the Facebook community.
This investment by Facebook suggests that it anticipate rapid growth abroad, which in turn should increase marketing competition on this social platform in the near future. Advertisers who wish to take advantage of Facebook’s limited marketing activity should recognize that competition could ramp up rapidly and plan accordingly.
Facebook has made considerable gains in the number of international users and the amount of digital ad spend in the international marketplace in recent years. In 2011, Facebook accounted for only 3.65 percent of global ad revenues, but by 2013 this number had grown to 5.41 percent; this translates into $3.15 billion ad revenue in 2011 to $6.36 billion ad revenue in 2013. In 2008, Facebook could only claim 34 million international users; by 2010 this number had increased to 400 million. Today, almost 86 percent of Facebook users hail from countries other than the United States.
It is also important to recognize Facebook’s growing presence on mobile devices. Not only is Facebook the most popular app on smartphones, but its popularity among mobile device around the world is exploding. Of the 669 million daily active users in 2013, almost 469 million engaged with Facebook via a mobile device.