Google and Facebook may have a massive lead over Twitter in terms of number of advertisers, but this isn’t actually such bad news for Twitter, BI Intelligence finds.
- Twitter had just 60,000 advertisers as of November 2014, compared to the 4 million and 2 million on Google and Facebook, respectively, according to Macquarie Securities.
This may seem like an insurmountable disadvantage, but it’s actually illustrative of Twitter’s focus on brand marketers. Twitter has grown its ad business by focusing on big spending brand advertisers instead of on small- and medium-sized businesses (SMBs), Macquarie notes. Facebook, on the other hand, has primarily been able to boost its advertiser count by attracting a large number of SMBs.
As a result, Twitter squeezes out far more revenue per advertiser than Facebook or Google:
- Twitter’s average revenue per advertiser was just shy of $US21,000 in 2014, compared to about $US16,000 and $US7,000 on Google and Facebook, respectively, according to Macquarie.
BI Intelligence believes that these strategies will converge going forward. During its analyst day last November, Twitter laid out its plan to increase its ad load to be on par with Facebook. This will require that Twitter increase its advertiser count significantly. Twitter has already taken steps toward this goal by rolling out ad units that are more appealing to small advertisers, such as mobile-app install ads.