Facebook, Inc. (FB) and Alphabet Inc. (GOOG) subsidiary Google will consolidate their hold on digital advertising this year, according to the latest report from research firm eMarketer. The firm estimates that Facebook and Google will together account for 60.4% market share of total digital ads coming online.
The two companies have staked out their turf in the digital ads landscape. While Google accounts for a majority of spending related to search ads, Facebook is king of display ads. On an overall basis, the market for digital ads in the United States is expected to grow by 16% this year. (See also: Google and Facebook Run 57% of All Digital Advertising Worldwide.)
Even "explosive growth" at recently public rival Snap Inc. (SNAP) will do little to challenge Facebook and Google's domination of the digital advertising market. However, Snap's popular messaging platform Snapchat is expected to see its ad share jump by 158% to $770 million this year. The company has rolled out several initiatives to attract advertisers. For example, it has created 30 installments of "Our Stories," a series of short films for the platform, in time for NCAA Basketball's March Madness. However, Facebook, which recently debuted a format similar to Snapchat’s Live Stories format, may steal its thunder. (See also: Can Snapchat Threaten Facebook's Ad Business?)
Monica Peart, forecasting analyst at eMarketer, writes that video is a major contributor to advertiser enthusiasm for Facebook's platform. "Facebook's users are increasingly captivated by videos on the platform – not just on Facebook but on Instagram as well," she writes. Still, eMarketer expects Snapchat's share of the advertising pie to grow in the future. The firm estimates that Snapchat will attract as much $2.2 billion worth of advertising revenue by the end of 2019. For context, the Venice, California-based firm reported $300 million in advertising revenue last year. (See also: Facebook Launches TV-Style Ads in Facebook Live.)