Social Networking Ad Spending

Recent report from eMarketer notes the importance of social networks online, estimating their marketing to reach $2.5 billion between 2007 and 2011 in the U.S., a 180% increase from this year.

Key hubs for online social networks as pointed out by eMarketer are MySpace and Facebook, as they have a broad reach to their demographics and have had an impact on advertising, for both online and offline. eMarketer highlights the concept of “one-to-many” marketing tactics and their ability to provide real results. They note MySpace’s sponsored marketing study as a start for addressing mass marketing on this level. With eMarketer naming MySpace and Facebook dominating the market share for online ad spending for social networks, accounting for 72% of ad spending in 2007, are these giants becoming too much like the traditional media companies that focus attention to the head of the long tail?

In culmination, eMarketer has increased its estimate of US ad spending on social networks to $900 million in 2007, based on increased revenue projections for Facebook, as well as additional spending on niche and marketer-sponsored social networks. These niche markets are important to look at, as they represent many of the new entrants into the social networking industry. Sponsored social networks will no doubt become some sort of marketing standard for awhile, as long as they’re executed correctly.

Also included in this report: exploring what’s happening with social networks on an international scale, what does and doesn’t work with social network marketing, and how video and mobile fit into the space.