Advertising on social networks

There was a good article in the New York Times on Saturday: Advertisers Face Hurdles on Social Networking Sites.  It charts the problems social media sites are having in making advertising work for their clients and therefore converting traffic their own traffic into cash.

The following paragraph sums it up well:

When major brands place banner advertisements on the side of a member’s home page, they pay inexpensive prices, but the ads receive little attention. Seth Goldstein, co-founder of SocialMedia Networks, an online advertising company, wrote on his Facebook blog that a banner ad “is universally disregarded as irrelevant if it’s not ignored entirely.”

For me it is increasingly obvious that unless the adverts hold some kind of interest for consumers then they aren’t going to work well.  As the NYT article notes that can take the form of good old fashioned promotions, but for me the more interesting approach is to get the community excited about (and discussing) some aspect of the brand or it’s products.  Further, brands who build profiles on social networks are unlikely to succeed unless they find ways to genuinely engage with their potential customers – see this NYT write up on Cartier and Myspace.

Which really means that the advertising becomes content.

I have long been sceptical about the notion that advertising can be content, but I have been changing my mind in recent weeks.  My reasons for scepticism are that it is really hard to turn brand messages into interesting content, but the new news is that people are starting to make it work, and, as shown in the NYT articles I linked to above, the seemingly easier alternatives are proving ineffective.

  • Nic, there is a fascinating study out by ComScore that shows banner ads are more effective than credited, I wrote a short note on my blog about it here.

    http://broadstuff.com/archives/1445-Theres-life-in-Display-Ads-yet.html

    (I still agree with SocNet ads though – large inventory + low attention means not ideal place)

  • Nic, there is a fascinating study out by ComScore that shows banner ads are more effective than credited, I wrote a short note on my blog about it here.

    http://broadstuff.com/archives/1445-Theres-life-in-Display-Ads-yet.html

    (I still agree with SocNet ads though – large inventory + low attention means not ideal place)

  • Hi Nic,

    I know you’re getting at something slightly different but advertising is content on: search engines (eg Overture/Google AdWords/AdSense), shopping engines, travel engines, classifieds engines etc. Offline it used to be the content of Loot for example. The ‘advertising as content’ model has been around for decades just as you noted that the freemium model has been around for decades in shopping malls etc.

  • Hi Nic,

    I know you’re getting at something slightly different but advertising is content on: search engines (eg Overture/Google AdWords/AdSense), shopping engines, travel engines, classifieds engines etc. Offline it used to be the content of Loot for example. The ‘advertising as content’ model has been around for decades just as you noted that the freemium model has been around for decades in shopping malls etc.

  • nic

    James – I totally agree. In fact one of the thoughts behind the post is that Google has as its mantra that advertising should be content.

  • nic

    James – I totally agree. In fact one of the thoughts behind the post is that Google has as its mantra that advertising should be content.

  • I'm not sure google see's it that way nic
    it depends on cases, this one in particular MAYBE … but thats not a rule or something

  • MatthewWarneford

    A solution to the problem is to consider how advertisers can bring something useful to the community. I engage with search advertising because its relevant to what I'm looking for, but consider why we use social networks or virtual worlds: when I want to connect with friends I use Facebook, to catch up with my sister I use IM, and if I’m bored and want to meet new people I go into a virtual world. While its possible to use the data collected about me to target adverts I'm just more interested in connecting with friends, talking to my sister, or meeting new people; those activities are really powerful and for any advert to meaningfully draw my attention so hard! So what I'm trying to say is – it has to be an incredible product that will distract me from the purpose of visit to the social network.

    We struggled with this same problem when we created the DubitChat.com virtual world way back in 2000. We experimented with lots of different options, from banners and homepage take overs, through to rooms, and whole new features. In those campaigns with measurable conversions (registering on the advertisers site, entering a competition, etc) banners often drove more traffic but with fewer cumulative conversations – the quality of the traffic was lower.

    The most popular campaigns were those that added something the sites users actually wanted, often it could be as simple as a new room but for one campaign aiming to expose young people to careers in construction we used it as an opportunity to develop a series of user content creation tools for the kids to 'build' their own environments.

    The challenges we faced we're two fold:
    – Selling: explaining virtual worlds to ad buyers in a post doc com era.
    – Scaling: creating constantly new and engaging advertising 'content'.

    Once we explained and convinced an advertiser to 'create' content for our world we had great results – we won awards for some campaigns! But its the scaling problem is actually more interesting. There are only so many 'features' that can be brought to you by coke (when I mention features I mean things like instant messaging, room builders, etc), only so many RedBull skateparks. So what is the repeatable and scaleable content that is relevant in a virtual world or social network.

    For Facebook I wonder if the applications are actually *the* advertising platform. Think of FBK applications as print editorials, brands can create genuinely useful and engaging content that is in context for the purpose of the site: Coke can make my goal of 'connecting with friends' through FBK better, easier, more fun, etc.

    For a casual virtual world I think the problem is still stuck at the phase of defining 'virtual world content'. We found on our site that young people had great trouble talking to each other – they want to be social, but talking to strangers is really hard! The world needs to make that process easier. I've talked more about this problem on my blog: http://blog.matthewwarneford.com/catalyzing-con

    The reason I bring up the problem of catalyzing conversation is that I believe the solution to that problem also provides the framework for advertisers to use. Just like editorial in print. The world provides content that the community engage with, and other portion is provided by third parties.

    Sorry for the long comment – content in virtual worlds, along with its relationship to advertising, really is at the heart of what we want to solve!

  • Great comment Matthew – really insightful. I will check out your blog with interest.

    Nic Brisbourne
    Partner, DFJ Esprit
    Email: [email protected]
    Tel: 07990 567 993
    Blog: http://www.theequitykicker.com

  • MatthewWarneford

    Thanks Nic, I've only got a couple of posts up there at the moment. We went through a number of learnings that lead us to begin developing technology to address the problem of content in casual virtual worlds. We feel quite passionately that the key is to create an interactive **narrative** that can be updated regularly inside the world. However, our strategy is to engage with the right partners to actually create that content.

    We're a technology company, we're not a narrative or IP business, and so we're not best placed to solve the problem of what narrative driven content in a casual worlds looks like, but we can solve the how. Think of the worlds as a medium for a message, much like TV is a medium for animated stories (cartoons). Imagine casual virtual worlds as the medium for interactive narratives… What does an interactive scooby doo look like!? Or an interactive 24 world… I've begun to talk about this more in here: http://blog.matthewwarneford.com/virtual-worlds… We want to provide the medium (virtual world platform) and the tools (scripting languages, editors, etc) for others (ip owners) to make the message (interactive narratives) on.

    Put another way, consider a hospital. In a hospital the super stars are the doctors, and they have no trouble finding other great doctors. But I'm pretty confident they would have great difficulty identifying a great marketing executive. Its much easier to identify similar people. For us that means we can find more programmers easily, but should we attempt to hire great authors, editors, or dramatists to build our own content in virtual worlds? Or work with those people who have a need to take their narratives IPs online to follow their audience?

    Ha ha I think I'm a bit long winded today… but what I'm trying to do is explain why there are only a few blog posts! Looooonnnngggg story short, now we almost have 1.0 of the technology complete we can begin engaging with partners to use their creativity and editorial insight to enable them to create content and their feedback to help refine our technology. One of they ways we intend to do that is by opening a discussion through my blog… So anyways… would love any feedback on the idea in there!

  • i agree with the ideea that advertising should be content
    for instance zango, they advertise their toolbars with offering content to publishers.

  • Well people evolving to be advertisement-blind. It is indeed a fact. I remember a research was done, were the iris of the eye was tracked on a PC screen. The results show that people are indeed extremely blind on advertisements, which increased based on the Internet experience of a user. I also believe that we are heading the content way!

  • I think it's not just about targeting but mostly about delivery. Facebook and the like would just have to get more original when it comes to ad delivery/placement if they want to increase their revenues per user.

  • A lot of people just don't understand that you don't get targeted traffic when advertising on social sites because people are there to socialize, not there to buy things. PPC is probably a better advertising platform.

  • When they finally figure out social network advertising the internet is really going to change.

  • seo

    Social networking has evolved… Facebook may have had its day… time for a new multi level platform

  • The 'advertising as content' model has been around for decades just as you noted that the freemium model has been around for decades in shopping malls etc.

  • I engage with search advertising because its relevant to what I'm looking for, but consider why we use social networks or virtual worlds: when I want to connect with friends I use Facebook, to catch up with my sister I use IM, and if I’m bored and want to meet new people I go into a virtual world.

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  • Yes, for sure the people hate to see ads, and many see the ad banner in the side of the page, then they don't look to this side at all, For this many webmasters now put their banners in the center of the page and through the article itself.
    العاب

  • Yes, for sure the people hate to see ads, and many see the ad banner in the side of the page, then they don't look to this side at all, For this many webmasters now put their banners in the center of the page and through the article itself.
    العاب

  • Yap When they finally figure out social network advertising the internet is really going to change.

  • Really nice post Thanks a lot for sharing…