Will Meta's growth finally stall?

Social media adspend overtook search spending at the start of the year, but problems are mounting for the biggest recipient of those social ad dollars, of which the economic downturn is just the latest.

Context

Meta already faced challenges in dealing with the effects of Apple’s privacy update last year, while a string of negative media stories led to an advertiser boycott of Facebook in 2020. Despite all that its advertising business has continued to grow – until now. Analysts are expecting Meta to report zero growth in Q2, a novel position for a business that has experienced almost non-stop growth since it began monetising via advertising back in 2007.

With CEO Mark Zuckerberg seemingly focused on the metaverse, a new ad leadership team will need to restore growth by rebuilding Facebook’s ad infrastructure while also addressing reputational issues and an ageing user base.

Takeaways

• Research firm Omdia forecasts that Meta will post 16% growth for all of 2022, down from 37% growth in 2021(reported in Business Insider).
• It also forecasts that Meta’s share of global net online advertising revenue will decline for the first time in 2022.
• Marketing attribution platform Rockerbox reports that Meta's share of clients’ spending was 29.9% in Q1 compared to 38.6% a year earlier.

Meta says 

“We believe our platforms offer businesses the best ways to connect with people, so we’re focused on successfully executing on our long-term plans.”

Sourced from Business Insider, WARC