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Has social media lost its luster?

Has social media lost its luster? Michael Estrin

Social media, with its growing army of devotees and shockingly low clickthrough rates, has long been a riddle for media buyers. Sites like MySpace and Facebook should be a natural fit for any buyer looking to achieve reach and frequency. In turn, that opportunity should result in an influx of major brand advertisers. But so far, brands have been reluctant to use social networks, at least when it comes to buying banner ads.

"Banners have long been the province of major brand advertisers, but we see that a lot of media buyers are carving out social networks right from the get-go," says Mark Kahn, CEO of Traffiq, an ad exchange that matches buyers with sellers.

According to Kahn, 25 percent of media buyers nix social networks before the first piece of their campaign is put in place. Another 25 percent of media buyers turn to social networks only when they realize their budgets may not be enough to achieve the reach they had hoped for.

That thinking may help explain two stories this week that tackled the issue of poorly performing ads on social networks.

In a non-scientific poll,  in an effort to develop vertical social networks around travelers.

Unlike their horizontal counterparts, vertical networks aren't likely to be so cruel to banners, according to Kahn, who suggests that brand advertisers may need to approach those networks as they would traditional publishers.

"[Vertical social networks] give you the right audience at the right time for the right advertiser," Kahn explains.

If Kahn is right and we are in the second inning for social networks, the middle innings are likely to be characterized by the rise of the verticals. That could be music to the ears of media buyers who have already become accustomed to the delivery of a narrow message to a highly targeted audience.

Michael Estrin is associate editor at iMediaConnection.

Michael Estrin is freelance writer. He contributes regularly to iMedia, Bankrate.com, and California Lawyer Magazine. But you can also find his byline across the Web (and sometimes in print) at Digiday, Fast...

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