Facebook, MySpace grab big slice of display ads
FACEBOOK and MySpace are responsible for a large chunk of web ads, according to a new report.
The report by analytics firm comScore claims one of every five internet display ads in the US is viewed on a social networking website, according to a new report.
It illustrates the increasing competition between social media sites and established internet companies like Yahoo and Time Warner’s AOL which have long billed themselves as the top online destinations for brand advertisers.
This week’s comScore study said social media sites represented 21.1 per cent of US internet display ads in July, with MySpace and Facebook accounting for more than 80 per cent of those ads.
“Because the top social media sites can deliver high reach and frequency against target segments at a low cost, it appears that some advertisers are eager to use social networking sites as a new advertising delivery vehicle,” said Jeff Hackett, senior vice president of comScore.
According to comScore, AT&T, Experian Interactive and IAC/Interactive Corp’s Ask Network were the top three advertisers on social networking sites in July.
While social media sites have enjoyed a surge in popularity in recent years - Facebook is now the world’s fourth-most visited website - some observers have questioned whether the sites can be effectively monetised.
Because the content on social media sites is created by users, and could therefore prove racy or offensive, some have questioned the willingness of marketers to place their brands alongside that content.
“(Advertisers) are sensitive to some extent, but nowhere near to the extent you might think,” said Sanford Bernstein analyst Jeff Lindsay.
The price of placing ads on social networking sites is significantly less than on a web portal like Yahoo or AOL, Mr Lindsay said.
The vast amount of web pages available on social networks means that advertisers can purchase a massive volume of ad impressions at bargain prices.
The strategy may not be ideally suited to smaller marketers, or advertisers seeking a direct response from their ads, Mr Lindsay said.
“For big, national brands it works just fine, just like TV,” Mr Lindsay said.
“It’s a huge, huge volume game.”