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Brand advertising programs at Facebook and Myspace working
May 22nd, 2006
Because CPMs are so low in the social networking business, companies like Facebook and MySpace are hoping to garner premium advertising dollars by enabling promotions that create brand-centered community among members. For example, 100,000 MySpace members recently became friends with the Wendy’s Square. Brand Managers love opportunities like this because it’s so hard to create “authentic” community around a product–many will pay out the nose to try something new they can tell their bosses about.
The sponsored group program at Facebook lets companies buy a link from the Facebook sign-in landing page to a “group page” that contains ad copy and a message board. Here is a complete list of all sponsored groups that have been purchased on Facebook. (Thanks Avery!) In summary, the following companies have Facebook sponsored groups:
- Apple
- CinemaNow
- Contiki
- EA (EA Games)
- Fox News/News Corp (interesting screenshots)
- Geffen
- Macy’s
- Maxim
- Microsoft
- Panasonic
- Sony (Playstation 2 accessories)
- Toyota
Also: CollegePoker.com, Spreadshirt, STS Travel, Al Gore’s “An Inconvenient Truth,” and the Dave Matthews Band
I predict that brand advertising products (like sponsored groups) will become a significant component of social networking revenue. While Facebook and MySpace will always have trouble getting a high click-through rate on standard ads (because kids come to hang out, not to buy), what they can offer Madison Avenue is the opportunity to have a presence where all the kids are — A, in a way that looks at least somewhat cool, and B, in a way that allows and measures various ways of interacting with the brand.
As always the tension for Facebook will be not to oversell these high-dollar placements and devalue them in the eyes of its members…
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May 22nd, 2006 at 10:35 am
Social Networking isn’t a revenue generator. These sites weren’t built behind a revenue model, therefore achieving substantial profibility will be next to impossible. SocNets are tools for users, and should be viewed as value added for another type of product for consumers. When people network, they want to network, not be sold.
When you meet friends at a bar or restaurant, do you want some jackass coming over to your table to sell you car insurance, or a spring break vacation? I didn’t think so.
May 22nd, 2006 at 2:03 pm
Seems to me that, with so many sponsored groups, they already are generating a profit… whether it will work in the long term is the risky part that makes it a good business.
June 2nd, 2006 at 3:47 pm
FacebookProfile.com
June 3rd, 2007 at 3:48 pm
[...] I may be wrong, but I think this is the first time Facebook has pitched profile pages in ad packages. This is old hat to MySpace, who’s been making Wendy’s Hamburger profile pages for a while now. [...]
July 14th, 2008 at 10:59 am
I think that social networking site will become a huge revenue generator! or it already has! Look at how ads could be targeted at specific interest or profile content. Only social networking sites has the potential to store all these information.