Meta about to overtake Google
Facebook-parent company on the verge of surpassing the search engine in online advertising
For the past twenty years, Google has dominated the online advertising market after displacing Yahoo. But that supremacy could come to an end as early as this year: the search giant is on the verge of being overtaken by Meta, according to forecasts from research firm eMarketer. Based on its projections, the parent company of Facebook, Instagram, and WhatsApp could generate $243.5 billion in ad revenue, compared with $239.5 billion for its main rival. A marginal gap for now, but one expected to widen in 2027.
It is important to note that eMarketer’s estimates are based on net revenue. Roughly $80 billion is deducted from Google’s figures, notably excluding traffic acquisition costs (TAC). These expenses correspond to the sums the Mountain View group pays to partner sites that display ads sold via its platform. They also include a range of commercial agreements, such as payments to remain the default search engine on Apple’s Safari browser. By contrast, no such deductions are applied to Meta’s advertising revenue.
Two successive disruptions
Back in 2006, the handover between Yahoo and Google marked a major shift in a market then largely structured around traditional banner ads. By introducing sponsored links tied to user queries, the search giant imposed a model based on user intent, dramatically improving ad effectiveness. The goal was no longer to maximize audience reach, but to drive qualified traffic to websites. Campaigns were billed per click rather than per impression.
The potential transition in favor of Meta reflects the culmination of two successive disruptions. The first came in the early 2010s with the rise of social networks—a shift Google never fully managed to capitalize on, despite multiple attempts, including Google+. The second, more recent shift stems from the explosion in consumption of vertical video on social platforms, first driven by Snapchat’s ephemeral content and then by TikTok’s endless stream of short clips. Meta has been quick to integrate both trends across its apps.
The success of Reels
These shifts are reflected in the revenue growth trajectories of the two giants, which together are expected to capture more than 53% of the global market. Google’s growth remains relatively stable at around 12%. Meta’s, however, has sharply rebounded following a modest, but historic, decline in 2022. Its revenue is expected to grow by 24% this year, after 22% last year — a pace comparable to TikTok, despite starting from a much larger base. “This is unprecedented for a company of this size,” eMarketer notes.
The strong rebound of the company led by Mark Zuckerberg is largely driven by the success of Reels, Meta’s TikTok-inspired short video format. In October, Reels surpassed $50 billion in annualized revenue, becoming more lucrative than YouTube. Behind the scenes, the company is also benefiting from improvements to its advertising platform, particularly in campaign optimization tools and AI-generated creative. “Advertisers are seeing better returns on investment, which is attracting more ad budgets,” eMarketer adds.