Social Networks Advertising reaching $2 Billion by 2010
By Colin Boyd • Feb 17th, 2008 • Category: Lead Story, NewsI recently read an article over at emarketer explaining that they expect advertising on social networks like MySpace, Bebo and Facebook to bring in more than $2 Billion in revenue by 2010. Don’t they get it yet!
Social networks by their very existence work by connecting people to people, groups to groups, interests to interests. Why would someone be interested in clicking on a banner when there focussed on finding out what there friends have been up to?
If the advertising platform on these networks becomes intrusive then the users of the networks will leave to find a new network that doesn’t interrupt. The new Facebook adwords based system won’t work because people aren’t in a search mode, that being the reason the adwords system works so well for Google.Google created based on how people interacted with there search interface. How many websites have copied adwords and failed? Quite a few I imagine.
The social networks have to find new ways to deliver advertising to the users on the networks without interrupting them.
I’ve had a think about this and the networks have to do something different form traditional online banners and contextual ads.
One method that hasn’t been tried yet is to use the very power of the network community.
- Buy product reviews
- Send products to users
- Pay for reviews
- Make it easy for them to tell friends
- Create people and groups
- Create product based people
- Fake CEO, Fake user of product
- Create product based people
This may be seen as being to meaner of two evils but it will allow a vast majority of network users to never see advertsing. Allowing the social networks to stay pure.
Does anyone else have idea’s on this?
Colin Boyd is Dedicated to staying at the forefront of SEO and Social Media Marketing
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Colin,
I completely agree that most of the large social networks will struggle to justify their valuations unless they are able to implement a new advertising model. Google recently admitted that adding its sponsored links to Youtube was a failure and Google have been disappointed with ad revenue from the MySpace deal. Many people believe that the value will come from social networks because you will have so much personal information and be able to provide your audience with highly targeted ads. However I think that there is a huge question mark over whether this will still appear intrusive for users that are on those platforms for ’social interaction’. Maybe if they can reach a level of ‘extreme personalisation’ this could work, for example targeting a group that are known video game players with a new release but importantly going down a level to target users that like that genre of game.
I believe that the solution to this problem may be a long way off and as we all know there will inevitably be new platforms into the market that time that will start to take market share from the current incumbents. The race is definitely on for the market leaders to understand how to interact with their millions of users to start to generate meaningful revenue.
Mark