The coronavirus pandemic will have an unexpected effect this year: Google’s advertising revenues in its first market, the United States, will drop for the first time in the history of the internet giant, which dominates the market with its engine. research and its YouTube video platform.
According to eMarketer's projections, the advertising revenue of the main Alphabet subsidiary across the Atlantic should fall by 5.3% this year, while the market as a whole should grow by 2%. It is the first time that Google has stalled since 2008, when eMarketer began measuring the online advertising market. The Mountain View firm should then resume the path of growth, rebounding strongly in 2021 (more than 20% expected) and 2022 (+ 11.8%).
In detail, Google’s advertising revenue is expected to be close to $ 39.6 billion, compared to the $ 41.8 billion earned last year. In 2018, these revenues had reached $ 36.5 billion. It’s not YouTube’s governance that will be impacted by the health crisis that is hitting the United States hard as revenues are expected to rise. Revenues from the sale of keywords on the Google search engine (“search”) will fall by 7.2%, according to data from eMarketer. Main explanation: the search activity is particularly exposed to the tourism and travel markets (Expedia, Booking ...), which are the most affected by the health crisis and have, as a result, sharply reduced their online investments .
Amazon, big winner
The main rivals of Google should however see their advertising revenues grow in 2020, and this despite the pandemic. On the American market, those of Facebook (Facebook, Instagram, Messenger, WhatsApp) are expected up 4.9%, to 31, 4 billion dollars. A brake all the same, since Facebook had seen its revenue grow by 26% in 2019.
For its part, Amazon should be the big winner among the big platforms, with advertising revenues that could jump by 23% in 2020, to $ 12.7 billion. The biggest growth of the e-commerce giant since it started to deploy in online advertising. Amazon and Facebook are respectively driven by the boom in e-commerce as a whole and by the rise of social networks.
As a result of these "movements" on the American advertising market, Google's market share should be 29.4% in 2020 (compared to 31.6% in 2019), while that of Facebook would be 23.4% (22.7% in 2019) and that of Amazon at 9.5% (7.8% in 2019). The oligopoly (62.3% of the market) remains in the hands of the same, but with narrow gaps.