If You Build A Social Network, Will Advertisers Come?
I took a break from the floor to listen to a panel discussion on social networks and user-generated content.
After the panelists waxed philosophical for a bit about how social networks are enabling our age-old desire to connect to other humans, they got down to the bottom line. Advertising is the bread and butter of such sites, but some big marketers are still a bit reluctant to pump money into sites like Facebook and MySpace, let alone the smaller niche sites like Dogster, for dog lovers, and BabyCenter, for new mothers.
So when will advertisers jump on board in a big way? Mike Gordon of Limelight Networks, which distributes online media, predicted there'd be a huge shift in 4 to 6 years. That's when media buyers will belong to the social networking generation, he said. Right now, the people in charge of buying ad space grew up with television, so they stick with that medium because it's familiar to them.
Matt Edelman, CEO and co-founder of a social network called PeopleJam, observed that TV ratings are plummeting, yet TV advertising revenue has gone up. "There's definitely a bubble there and hopefully we can be the beneficiaries when that bursts."
Reena Jadhav, founder and CEO of CareerHero.com, a site targeted at college students that lets them explore different careers, said the company is building a virtual world within the site where people can live the day-to-day life of a doctor or a lawyer so they can experience what different professions are like.
"There are companies out there trying to think of how to bring gaming and virtual worlds into their own networks," she said.
I wonder if advertising of the future will be product placements in these social-networking-virtual-worlds.
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