Advertising in Social Networks

October 13, 2008 – 9:18 am by Jon Parks

As I’ve noted previously, I’m a big fan of the blog Marketing Pilgrim and I consider it a “must read” at the start of each day. A post on that site today notes that MySpace is moving into public beta of its “MyAds” application to allow advertisers to target users of the social network using the biographical data provided by the users at the time of registration.

Earlier this year, I wrote about social networking and the online advertising. At the time, Facebook was early in its use of display ads (this was following the Beacon debacle) and MySpace was struggling with only making $6 to $7 per user, per year. Now, both major social networking environments have ventured into the display advertising arena and seem to be doing a good job with it. In fact, I’ve noticed more and more targeted ads through my own Facebook account, and some, but not all, of them are pretty good.

So, does this mean that the social networks are on the verge of really turning a strong profit through their business models? The jury is still out on that one, but this is a good step in the right direction. Monetizing the web is a challenging thing to do through display advertising. However, wherever the crowds are, advertisers will soon follow. The trick for social media sites is what will happen to the crowd when the advertisers show up? Will they revolt and leave the network? Will they develop a new threshold for “tolerating” ads? Or, will they actually engage with the ads that they find interesting/helpful? Only time will tell.

One last thing– you can find me in the social networks by friending me on Facebook or via the following: