Meta said on Wednesday that Apple’s changes would cost it $10 billion in revenue over the next year. The company has railed against Apple’s shifts and said they are bad for small businesses that rely on advertising on the social network to reach customers. But Apple is unlikely to reverse its privacy changes and Meta’s shareholders know it.
Google is stealing online advertising share.
Meta’s troubles have been its competitors’ good fortune.
On Wednesday, David Wehner, Meta’s chief financial officer, noted that as Apple’s changes have given advertisers less visibility into user behaviors, many have started shifting their ad budgets to other platforms. Namely Google.
In Google’s earnings call this week, the company reported record sales, particularly in its e-commerce search advertising. That was the very same category that tripped up Meta in the last three months of 2021.
Unlike Meta, Google is not heavily dependent on Apple for user data. Mr. Wehner said it was likely that Google had “far more third-party data for measurement and optimization purposes” than Meta’s ad platform.
Mr. Wehner also pointed to Google’s deal with Apple to be the default search engine for Apple’s Safari browser. That means Google’s search ads tend to appear in more places, taking in more data that can be useful for advertisers. That’s a huge problem for Meta in the long term, especially if more advertisers switch to Google search ads.
TikTok and Reels present a conundrum.
For more than a year, Mr. Zuckerberg has pointed to how formidable TikTok has been as a foe. The Chinese-backed app has grown to more than a billion users on the back of its highly shareable and strangely addictive short video posts. And it is fiercely competing with Meta’s Instagram for eyeballs and attention.
Meta has cloned TikTok with a video product feature called Instagram Reels. Mr. Zuckerberg said on Wednesday that Reels, which is prominently placed in people’s Instagram feeds, was currently the No. 1 driver of engagement across the app.
Article source: https://www.nytimes.com/2022/02/03/technology/facebook-meta-challenges.html
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