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It’s an ad duoply battle. Facebook is starting to test search ads in its search bar and Marketplace, directly competing with Google’s AdWords. Facebook first tried Sponsored Results back in 2012 but eventually shut down the product. Now it’s going to let a small set of automotive, retail, and ecommerce industry advertisers show users in the US and Canada. Facebook may expand search ads to more countries based on the test’s performance.
The reintroduction of search ads could open an important new revenue stream at a time when Facebook’s revenue growth is quickly decelerating as it runs out of News Feed ad space, the Stories format advertisers are still adapting to gains popularity, and users shift their time to other apps. In Q3 2018, revenue grew 33 percent year-over-year, but that’s far slower than the 49 percent YOY gain it had a year ago, and the 59 percent from Q3 2016. Opening up new ad inventory for search could reinvigorate the revenue growth rate that, combined with Facebook’s privacy...
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