Start Up Blog

Google overtaken by Facebook? Not really.

Posted in entrepreneurship by Steve Sammartino on March 17, 2010

It’s all over the news that Facebook has overtaken Google in terms of traffic in the USA.

But make no mistake, Google has not been overtaken by Facebook. Facebook is a long way off Google as far as commercial success is concerned. The importance difference, which isn’t about to change anytime soon is this:

People do business with Google.

People socialize on Facebook.

And just like any party, they tend to fizzle out. This seemingly small difference has a dramatic impact on their futures. My analogy is that of a fun park versus CBD. Facebook is being touted as the final platform, the social network to beat all social networks. And yes, it still has some laughable valuations ($100 billion) .

The reality is that numbers can be very deceiving, and when looked at arbitrarily like this, and I’m still certain the value of each Facebook visitor is marginal compared to that of Google. The question I asked myself is this: Could I live without Facebook? Yes. Could I live without Google? No. I’m not about to predict the future, but I want to leave startup blog readers with a reminder that statistics only have value when they are placed in context.

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13 Responses

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  1. Sam Sabey said, on March 17, 2010 at 3:17 pm

    Nice summary Steve.

    I don’t use facebook much, but I google a lot.

    I believe the success of FB reflects in part the huge number of people turning to the interwebs for entertainment, particuarly those stuck in cubicles, for whom there are many many in the world.

    Sam.
    @samotage

  2. Canned Content said, on March 17, 2010 at 3:28 pm

    This is actually a really good point, I think everyone just got so caught up in the stats to care about context.

    It’s nice to pull away and be reminded it’s more relevant to be #1 in your category…

    Andrea
    @CannedContent

  3. Steve Hopkins said, on March 17, 2010 at 3:47 pm

    Good post Steve – but I just wanted to argue the opposite point for a minute :)

    I haven’t heard the news, but tend to agree that the actual stats don’t matter too much. I even agree that Facebook and Google come from very different contexts. But I don’t think this means that facebook might not be more valuable than google. Let’s be careful to look at the whole data set, rather then extrapolate from one data point (or own point of view).

    I agree, that I couldn’t live without Google but I could totally survive without Facebook. But that might not necessarily be the case for kids or teenagers, who perhaps require Facebook to connect and remain relevant to their friends.

    All I’m saying, is that (like you say) context IS important. And it’s equally important to consider the context we view the stats in, as well.

    Great post :)

    • Sam Sabey said, on March 17, 2010 at 3:51 pm

      it is possible that the value of the data collected about people by FB may in the future have significant value. However it’s the G that’s actually got a model to market, today.

  4. Michael Specht said, on March 17, 2010 at 3:50 pm

    At the request of Steve let my pose some questions, thoughts etc.

    The Hitwise numbers are for the 2 main TLD’s facebook.com & google.com, they do not seem to include all properties, so let’s ask what about youtube, the 2nd or 3rd largest search engine. Even if they did would they account for embedded content such as YouTube videos that are a Google property?

    Also Hitwise talks visits, absolute unique visitors, pageviews, time on site what?

    These are all very important to know. Google uses lots of AJAX so not as many page views as they could have. Also if my son and his friends are anything to go by we need to look broader than just Google & Facebook. They have dumped MSN for chat, it is now all Facebook, they are dumping traditional flash games, Facebook, they are moving to Facebook to consume videos such as content from YouTube.

    Oh I also agree with your post Steve it is all about context :-).

  5. leon said, on March 18, 2010 at 8:27 am

    “Could I live without Google? No,” I’m not sure I ever read something so incredibly depressing.

    Now I don’t think that google or facebook, or even a computer are essential to anyone’s lives, and I’m sure you are not saying you need google in the way that you need oxygen, or food, but concerning none the less, as I believe you have swallowed the marketing hype behind google (and apple but that’s another rant) without question.

    What I’m concerned about is how you have been sucked into the google vortex. I remember having a conversation with you a couple of weeks ago where you banged on, at length, about Yellow Pages and how they are completely useless and businesses hated them, and how they were once relevant but are no longer. Well explain to me how Google (through it’s primary business, search) is not just the yellow pages of the new century, or you know the Melbourne BIG, or Sands and McDougall, or any other now defunct directory listing. Perhaps we shouldn’t place google on such a pedestal.

    As for facebook, I agree that the valuations are wrong, having said that I don’t understand how facebook can’t make huge amounts of money, they have the traffic numbers, but they seem be scared to run the site as a commercial entity., why would they don’t run the levels of banners, over the page executions and advertising as news.com, or theage.com.au, rather they serve up trashy weigh loss, dating ads.

    Facebook could be a powerful advertising medium, because it has a number of unique attributes that google doesn’t have, the social nature of it, and thus the relaxed frame of mind of the audience, plus the ability for people to have conversations should appeal to any marketing manager and more importantly PR manager. Unfortunately for facebook the best campaigns on the site don’t seem to use paid media, but are really more PR activities.

    It also worth remembering that google is a business/transactional tool, and facebook as a social tool, they are completely different media, the way that Cleo is a different magazine to BRW, there is absolutely no reason to compare the two just because their delivery method is the same.

    • Steve Sammartino said, on March 18, 2010 at 5:38 pm

      Firstly, the live without – was in the context of websites with value….

      Your point about different media forums and the examples you give are valid. My deep question is this. Is Advertising the only way on line media can make money? So far it seems the answer is yes – which to me is a bit disappointing.

      Steve.

  6. Michelle Matthews said, on March 18, 2010 at 5:40 pm

    There are more substitutes for Google than there are for Facebook. You’ve invested & personalised FB. http://bing.com

    Michelle (@secretshq via twitter)

    • Ross Hill said, on March 18, 2010 at 5:42 pm

      Well said MM that was my thought too. i’d say twitter is my most important app.

      Ross Hill (@rosshill via twitter)

  7. Pieter Peach said, on March 18, 2010 at 5:52 pm

    Nice break down.

    Pieter Peach (@ppeach via twitter)

  8. Xavier Shay said, on March 18, 2010 at 6:02 pm

    Facebook advertising is far more effective (and more expensive to buy…) than google – they have so much more information available to them to target the ads.

    In addition, games like Farmville and Mafiawars are *huge* cash cows (Farmville has more users than twitter, prob mafiawars too) Even though they’re operated by third parties, it gives FB a *lot* of leaverage.

    Google can show you ads while you are looking for things*, not once you get there. FB shows you ads all the time, people go there ‘just to be there’ rather than just looking for something, plus they have extremely valuable marketing data about you.

    Maybe they haven’t “won” yet (are they even really competing?), but my money is on FB**

    * Excluding youtube, which they only just bought.
    ** Not literally though – I hate the company ethically

  9. Nicholas said, on March 18, 2010 at 11:02 pm

    As a by the by, the facebook advertising platform is coming along in leaps and bounds, some really nice reporting, conversion tracking beta and a raft of other stats for us marketing data nerds out there.

    As Xavier mentioned, it’s a completely different kind of targeting, and the audience is there for completely different reasons than they are when they’re about Googling for something. No doubt, that if I block the toilet and i desperately need a plumber, i go Googling. However Facebook allows you to turn your business and brand into a form of virtual street art for all to see and identify with.

    In terms of whether there are ways to create value without advertising, the Facebook platform allows a different form of advertising where as a brand you allow your evangelists and customers the opportunity to interact with you publicly, in front of their friends, family and colleagues.

    Wouldn’t it be cool if Rentoid talked with the Facebook marketplace, so that when i put something up for rent, it automatically leverages my social network by radvertising it to my friends news feeds?

  10. Sam Sabey said, on March 19, 2010 at 8:27 am

    This came to my email this morning, I think it outlies value well

    http://bit.ly/axhWIU

    Sam.
    @samotage


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