Advertisers Love Social Networking, Apparently, So Where's The Money?

from the invisibility dept

There's a flurry of activity around social-networking sites as they try to figure out how to make some money, and it's matched by advertisers that don't want to miss out on the next big thing. But they're casting a cautious eye over the sites, with much of that concern put down to worries that their ads will be displayed alongside objectionable user-created content, or that they'll get caught up in the blame game surrounding the sites' supposed dangers to children. Some sites like MySpace are trying to figure out way to offer advertisers a "safer" experience, but it's worth wondering if their reticence isn't solely based on fears about the content, but rather also if the ad space is actually worthwhile. Despite their huge amounts of traffic, the ad rates social-networking sites charge are reported to be very low, perhaps an indication of the results they deliver. If they delivered high clickthroughs and conversion rates, would advertisers be so concerned? So as the bubble-esque hype surrounding these sites carries on, it remains murky just how they'll turn their massive traffic into massive revenues.

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  1. identicon
    WirelessGuy, 12 Jul 2006 @ 3:40pm

    The scary thing for me

    Is that for my job I hear day after day how social networking is the next big thing in wireless. I sit in presentation after more on how people want to have others know where they are so that they can quickly get together with their social life friends....

    How did we ever manage to live prior to these places???? Was our old methods of calling people, having friends you could actually get together with instead of only virtually? Do we really want life via a plasma screen over reality? I for one hate my computer, my cell phone and if I could i would get a job planting trees in the Amazon....oh for the advent of child support suppresion....

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