Monday, November 06, 2006

Social Networking set to be next AD space.

eMarketer has a report out that mntions AD SPENDING ON SOCIAL NETWORK sites is set to top $1.8 billion by 2010, but the network operators need to accommodate the advertisers requirements. The advertisers need to measure the performance of the ADs and sites like MySpace need to develop tools to fulfill these needs.

eMarketer predicted that ad spending on social networking sites this year will be $350 million--an upward revised from the previous estimate of $280 million. Next year, the amount going to social networking sites will reach $865 million, with MySpace.com capturing 60% of spending, according to the report.

At the same time, eMarketer cautioned that social networking sites must develop metrics for their unique marketing offerings--including sponsored groups, or users that add brands as "friends" or "interests." Like you may have a coke friend or you ill have to join Coke group.

"If social networking sites are to capture more than experimental ad dollars, adequate measures of return on investment need to be in place," the report stated. "So far, these are still a work in progress."

As a percentage of total online ad spending, eMarketer expects ad spending for social networking sites to account for 2.2% of the $15.9 billion estimated total online ad spending this year; by next year, such sites will account for 4.7% of the predicted $18.3 billion in online ad spending. By 2010, the report estimates that social networking site spending will account for 8.5% of the projected $25.5 billion in online ad spending.

No comments: