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Advertising on Social Networks

Frank Gruber
Advertising on Social Networks Frank Gruber

Basic social networking has been around since the early days of the internet, in the form of instant messaging, message boards and forums. Yet, social networks began to take a new form with the creation of sites like Friendster and GeoCities, which allowed people to express themselves in text online. Recently a bright spotlight was placed on these interaction tools. The Web 2.0 movement has evolved social networking sites like MySpace, Facebook and TagWorld and positioned them as the front-runners in the field.

David Carlick, managing director of Vantage Point Venture Partners, kicked off yesterday's ad:tech social networking panel by saying, "What we think in marketing doesn't matter, but what people actually do does matter." He went on to briefly demonstrate how people connect on MySpace.com, and when he encountered some questionable and somewhat risqué photos, he challenged the audience by saying, "How can you advertise with user-generated content that may not be the most appealing to advertisers, especially since this stuff is more fun than television?"

Amy Gibby, president of eCRUSH.com, described how there has been a recent changing of the guard online with social networks-- from a "push" medium to a "pull" medium. She mentioned how eCrush.com is using people's "attention" to engage users with advertisers. She says, "Teens realize that they are going to have to participate in advertisements or pay for the eCrush.com premium services." So basically, users are trading their "attention" to ads in exchange for the use of preferred services. 

Shawn Gold, senior VP of marketing and content of MySpace.com, tried to answer the question, "Is social networking a fad or an enduring online behavior?" In doing so, Gold gave a brief explanation of the evolution from Social Networking 1.0 to 2.0. This included highlighting Friendster's poor technology, which resulted in a non-scalable service, lack of customizations for user self-expression and limited connectivity through popular culture or blogging. Gold did note that Friendster is still the most popular website in Guam, but explained that it may be due to their lack of broadband penetration.

Turning the focus to MySpace.com, Gold explained how they have been focusing on the user, offering individuality through self-expression, allowing users to connect with others through pop culture and, most importantly, evolving by creating new tools for the influencers to express themselves. For example, he pointed out that if Yahoo! were to create a new music channel, they would offer a place for people to go and listen and purchase mainstream music, while MySpace would attack the same initiative by offering musicians the tools to place their music online to express themselves. Gold went on to say that, "If social networks do not add a mobile extension, they will fail."

Ted McConnell, interactive innovation director at Procter & Gamble, tried to convey that social networks are a safe place to advertise. He offered some perspective on selecting the correct context and advertising channels in saying, "Intrusiveness in the wrong context channel creates a negative effect towards a brand." He went on to define the intimacy of a channel by saying, "I guess any medium you can have sex on is intimate." However, when McConnell was asked to give some success stories with specific P&G brands and initiatives, he was unable to comply, which might have left some advertisers and marketers in the crowd unconvinced on the safety of advertising in social networks.

In summary, online social networks are here to stay and will continue to gain traction and offer users more interactivity than other media. Advertisers are going to need to take some responsible risks in the new channel.

Frank Gruber currently is the Product Manager for Classified Ventures' Apartments.com, where he focuses on product development and strategy for the consumer website. .


to leave comments.

Commenter: Sharon Willemsen

2008, September 03

Hi Frank! I know this is pretty old article, but it is still very relevant. I work at konnects.com which is a social network for professionals. We provide the ability to geo-target any member with advertisements that would meet that person's needs based on their profile information. Social networks provide any advertiser the ability to target a very specific target and it is money well spent.