Key insights from Facebook Q2’17 earning report for digital marketers
Facebook reported its Q2’17 earnings yesterday, and it beat analysts estimates in all areas. With $9.32 billion in revenues and EPS of $1.32, it came way ahead of analysts forecasts at $1.13 EPS. Facebook’s acquired platform, Instagram is also performing exceptionally and is expected to bring in ~$4 billion in revenue in 2017. The impact of these numbers was so much that the Facebook’s stock attained its all time high of $175. Here is the snapshot of how Facebook stock has been surging in last 5 years.
What is the most important takeaway from Facebook’s report for digital marketers?
But how are these numbers important for digital markers? And what does this has to do with CPG and retail companies? Well these numbers have a lot of importance, and the devil is in the details. Closely looking at the financial metrics released by Facebook, one metric that stands out is its surging user base. Facebook claimed to have attained over 2 billion unique users (monthly). More importantly, 1.32 billion users are active on daily basis. Below graph depicts the trend of increasing user base for Facebook which has recently became slightly parabolic.
What are the implications for digital marketers?
This large user base makes Facebook a very important advertising platform for every digital marketer who use Facebook as their promotional channel. Any campaign launched on Facebook is expected to reach to multitude of consumers in a matter of minutes and at a cost which is fractions of fraction of cost of traditional channels. Facebook ad costs are estimated to be $0.16 per click for average CPG company. Facebook also allows marketers to target their ad towards segmented audience. Being able to segment audience by their region, gender and other demographics, marketers can reach to a very specific population at a nominal cost. Assuming that 50,000 users view and click on the ad during the campaign period, the total cost of campaign comes to be $8,000. Compare this to average cost of $112,000 for a 30 seconds ad slot in a prime time broadcast TV.
Such numbers highlight the shift in CPG marketer’s focus from traditional to digital channels, and Facebook earnings reiterates this trend loudly!