Advertisers Love Social Networking, Apparently, So Where's The Money?

from the invisibility dept

There's a flurry of activity around social-networking sites as they try to figure out how to make some money, and it's matched by advertisers that don't want to miss out on the next big thing. But they're casting a cautious eye over the sites, with much of that concern put down to worries that their ads will be displayed alongside objectionable user-created content, or that they'll get caught up in the blame game surrounding the sites' supposed dangers to children. Some sites like MySpace are trying to figure out way to offer advertisers a "safer" experience, but it's worth wondering if their reticence isn't solely based on fears about the content, but rather also if the ad space is actually worthwhile. Despite their huge amounts of traffic, the ad rates social-networking sites charge are reported to be very low, perhaps an indication of the results they deliver. If they delivered high clickthroughs and conversion rates, would advertisers be so concerned? So as the bubble-esque hype surrounding these sites carries on, it remains murky just how they'll turn their massive traffic into massive revenues.
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  1. identicon
    RenderingSanity, 12 Jul 2006 @ 10:16am

    Seriously picture life without myspace for a second. Imagine the chaos it would cause as no one would be able to talk to their friends, meet new people, plan dates with "that special someone" or get laid.

    link to this | view in thread ]

  2. identicon
    YourMomIsOnMySpace, 12 Jul 2006 @ 10:37am

    The same morons that brought you the dot.bomb based off of ad revenues that didn't exist--are now bringing you this newest waste of time and bandwidth.

    The only thing that may generate revenue for networking sites is offering a non-popup and advertising version that doesn't take 15 minutes to load with a broadband connection (and also doesn't remind you that there are retards getting degrees in marketing but learning absolutely nothing).

    link to this | view in thread ]

  3. identicon
    G, 12 Jul 2006 @ 10:53am

    You're correct, all the traffic on those networking sites doesn't equal effective advertising. We would rather spend money on the low traiffic but highly effective CNET or Yahoo Shopping then on MySpace.

    link to this | view in thread ]

  4. identicon
    kantankerus, 12 Jul 2006 @ 11:51am

    advertisers dont want

    a] intelligent consumers
    b] people with a life

    link to this | view in thread ]

  5. identicon
    Anonymous Coward, 12 Jul 2006 @ 12:05pm

    The problem with ads on sites like myspace is they're all for dating services or those stupid games that try to get you into a referral program for a free ipod. I'd by 100% more interested to click on a google ads link (which personalizes itself to keywords on the page) than a half naked woman.

    link to this | view in thread ]

  6. identicon
    anonymous coward, 12 Jul 2006 @ 12:55pm

    as the publisher of "the dummies guide to pedophilia" i find MySpace a perfect advertising vehicle!

    link to this | view in thread ]

  7. identicon
    I, for one, 12 Jul 2006 @ 2:52pm

    Re: advertisers dont want

    kantankerus writes

    "advertisers dont want

    a] intelligent consumers
    b] people with a life"

    That's quite spot on in fact. There's a fundamental clash of psychological values going on in this marriage, the kind of minds who engage in social networking are exactly the kind of people advertisers should avoid. Unfortunately they just see any crowd of people gathered in a group and they get an instant hard-on.

    Social networking is a p2p model, by definition. The fact that people happen to congregate on a server like MySpace or whatever is entirely accidental to the phenomena, they could just as easily move somewhere else next week.

    What keeps them coming back to use that particular server? Well the fact that it is "My Space" - and not , say, Pepsi Colas space?

    That's the nub of it really. Advertising is anathema in this mindset.

    link to this | view in thread ]

  8. identicon
    WirelessGuy, 12 Jul 2006 @ 3:40pm

    The scary thing for me

    Is that for my job I hear day after day how social networking is the next big thing in wireless. I sit in presentation after more on how people want to have others know where they are so that they can quickly get together with their social life friends....

    How did we ever manage to live prior to these places???? Was our old methods of calling people, having friends you could actually get together with instead of only virtually? Do we really want life via a plasma screen over reality? I for one hate my computer, my cell phone and if I could i would get a job planting trees in the Amazon....oh for the advent of child support suppresion....

    link to this | view in thread ]

  9. identicon
    jason, 13 Jul 2006 @ 1:36am

    Social networking - new sites?

    What would you say are the top social networking oriented sites? And how are they making money? Maybe it's time for a new approach?

    link to this | view in thread ]

  10. identicon
    Nicholas Carlson, 20 Jul 2006 @ 6:47am

    Social Networks + Social Search = $

    Ok, so this is totally tooting my own horn, but check out the article I wrote on this subject over at InternetNews.com

    http://www.internetnews.com/ec-news/article.php/3620211

    I think Mansfield has an interesting point.

    link to this | view in thread ]


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