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Should Google be worried about Facebook's revamped Atlas platform?

05-November-2014
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Should Google be worried about Facebook's revamped Atlas platform?

Facebook is approaching the field of ad technology with a long-term plan and the recent launch of the Atlas advertising platform is an indication of the social media giant’s strategic approach. Facebook had acquired ad tech platform Atlas from Microsoft back in 2013. After undergoing extensive revamp, the platform was relaunched in September.

What Atlas does is it allows Facebook advertisers to target users across digital properties and devices. It also provides a non-cookie based option for advertisers by using log-in data available through Facebook. "Cookies don't work on mobile, are becoming less accurate in demographic targeting, and can't easily or accurately measure the customer purchase funnel across browsers and devices or into the offline world," Erik Johnson, head of Atlas at Facebook, wrote in a blog post. "People-based marketing solves these problems."

So why is the launch of Atlas significant?

For years, Google has been the undisputed leader when it comes to digital advertising. eMarketer’s July 2014 report shows that Google currently accounts for 31.45% of total digital advertising revenue globally, a staggering 24% more than second placed Facebook’s 7.79%. Among the two main pillars of Google’s digital empire is the Google Display Network (GDN), a massive collection of websites, including Google properties that run AdWords. The second is DoubleClick, Google’s ad tech platform, responsible for ad serving. Unlike Atlas, DoubleClick runs on cookie data.

Before Atlas, Facebook had experimented a bit with ad networks which culminated with the launch of the Facebook Exchange (FBX). However, FBX is not a true ad exchange since it allows advertisers to display ads on Facebook properties, at least not yet. Neither does it connect to multiple networks like other ad exchanges. With Atlas, the lack of a genuine ad serving platform has been met. Also, with the identification system, Facebook removes at least some of the hurdles with cookie-based systems. It is worthwhile remembering here that Google could have used Google+ as an in-house alternative to cookies if not for the failure of Google+ to take off.

The accuracy of Facebook’s social data has made it a darling of advertisers and agencies alike. With Atlas, these social insights are now available to target users as they move through the internet and not just Facebook’s “Walled Garden”.

“We have been talking about multi-device, cross-channel targeting for a while now and I am delighted that Atlas will be able to deliver on the same. We know the existing limitations of cookie-based tracking and with the huge volume of self opted demographics and persistent logins along with user behavior is something that only a marketer can dream of. Only time will tell how good its scalability and RoI are, but at the onset, it looks like an answer to our prayers,” said Gautam  Mehra, Social Media Head at iProspect Communicate 2.

Does Google need to be worried?
Though the launch of Atlas is an important move for Facebook not everyone seems to feel Google needs to worry.  Preetham Venkky, Head (Digital Strategy & Business) at KRDS Asia said, “This is definitely the right move by Facebook, but not necessarily a complete threat to Double Click.” One reason for this is that some analysts feel that Facebook might be exaggerating the importance of a non-cookie based system. The fact that Facebook has not released more information about its “people-based” system doesn’t help matters.

In the recent analyst call to announce Facebook’s Q3, 2014 results, Facebook COO Sheryl Sandberg waxed eloquent about Facebook’s plans for ad tech. Though Facebook is expected to increases expenses next year by nearly 55-75%, with most of the money going into developing existing products and ad tech, the returns from these might take some time to show. Mark Zuckerberg, himself, admitted that these were more long-term investments.

Facebook has never hidden its ambition to take away digital ad shares from Google. On the mobile front, it has made remarkable progress, quickly closing the gap between the two. The recent acquisitions and investments in ad tech also prove that it has the will to follow up on its ambitions.

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