Social Networking Use Triples from Only a Year Ago
Obsessed with Facebook? You're not alone. The hours you spend logging on to update your status, post photos, and make comments on friends' walls is not simply a "phase" you're going through which will end sometime soon. It's a ongoing trend affecting everyone these days and it has serious implications for the online advertising industry.
According to new figures from Nielsen, the amount of time spent surfing social networking and blogging sites had tripled since last year, suggesting "a wholesale change in the way the Internet is used," says Jon Gibs, VP of media and agency insights at the company's online division.
As of August 2009, the time spent on social networking and blogging sites accounts for 17% of the total time spent online, a number up from 6% from a year ago. This change reflects a growing desire for people to stay connected with each other, communicate and share, reports Nielsen.
Advertisers Taking Notice
While for consumers, hitting up Facebook for a daily dose of socializing is just par for the course nowadays, this change in consumer behavior has had dramatic impact on the online advertising industry. Where before, advertisers were somewhat wary of social media properties, they're now spending more than ever for prominent spots on social networking sites. Even as companies decreased their overall ad expenditures, they increased their spend on top social networks and blogs - up 119% from last year. ($108 million in August 2009 up from $49 million in August 2008). And when broken down by category, the increases are even more dramatic. The entertainment industry, for example, has increased spending by 812% year-over-year on social network sites and the travel industry increased spending by 364%.
When it comes to which sites advertisers choose, there's no doubt that Facebook is currently the king. Ten out of thirteen industries analyzed by Nielsen listed Facebook as advertisers' number one choice when ranked by display ad impressions. The only industries where MySpace still ruled were Entertainment, Financial Services, and Hardware & Electronics.
Those findings seem to mostly support what a study from earlier this year said about MySpace's demographics. Namely, MySpace users are more focused on entertainment than those on other networks and have the lowest average income (hence the need for financial services). However, it's LinkedIn users who are the most interested in gadgets said the study, so the Hardware and Electronic ad spend on MySpace is a bit surprising. We suppose that's simply because the number of MySpace users dwarfs that of LinkedIn. Well that, and the fact that these days "Entertainment" means TVs, game consoles, and other techie gadgets.
For a full look at the dollars spent by category, check out Nielsen's full report.
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I can stop whenever I want. I just don't want to.
Interesting tidbit about MySpace! But yes, social media is definitely showing advertisers it's worth!
Yeah i advertise in facebook not in myspace
http://Blastoffpress.com
Just because people are spending more time in social networking doesn't mean it will become a major avenue for display advertisement.
Until recently email was the No. 1 activity on the Internet. Yet email sites like hotmail or Yahoo mail never became big in display ad. Why? Because when people are emailing they're focused on their friends and it is not an environment conducive to ads. Same goes for IM services like AIM or ICQ - huge usage, minimal revenue.
Social networking has gained so much in usage mostly because people are using it in place of plain old email. Instead of talking to their friends over email they're now talking over facebook or myspace.
The same problem is still there: when people are on facebook they're focused on their friends (just like when they were on hotmail & AIM) and it's not an environment conducive to ads.
I'm with Andy on this one. Social networking may be where the crowds are, but it doesn't necessarily equate to successful advertising.
Companies need to show more imagination when it comes to engaging with customers on social networks. Sponsorshoip, whereby their brand is associated with specific sites or particular features of that site, may be the way to go if you have big(ger) budgets.
Ian Hendry
CEO, WeCanDo.BIZ
http://www.wecando.biz
Yeah i've been aware of this for awhile now. I've noticed how all the ads on my Facebook are related to the groups i've joined, people I've become fans of, things I like etc.
Very interesting post. Usually i am using face book and my space. But it's not my habit. I can leave to do whenever i want.And people living in lonely places, After the busy life they want something different. Like A college guy want to find girl, The social networking sites makes it possible. Sometimes the friends of networking sites are becoming more than our relatives or friends. I don't think it is bad. or encouraging people into wrong direction.
You accidentally misquoted the numbers:
You are writing:
"the time spent on social networking and blogging sites accounts for 17% of the total time spent online, a number up 6% from a year ago"
But Nielsen says:
"In August 2009, 17 percent of all time spent on the Internet was at social networking sites, up from 6 percent in August 2008."
I.e. the numbers are not up 6 per cent but 11 percentage point, which is a huge difference!
I am using networking sie from many years, I don't think it's waste of time. I am enjoying and every time i felt i got something.
I am also with Andy on this one. I think it is just an effort on the social media companies to ROI more than anything else.
Some parts of the blog Itotally agree with however the lifestyle that people now live means that on line sites are the way to communicate.
Depending on how creative a company is - whether it is a Fortune 500 or a mom & pop operation - social networking sites can be a strategic place to advertise...
Just recently, there was a very popular fast food restaurant that promoted their social networking site and asked for people to add them as a friend...
...in only a short period of time
There were 500K people added - will it prove to be profitable - in the long term it should be...
They offered a $5 discount to those who became friends - if you think about it - that discount is just to get people in the doors...
Most people will spend at least four times that - now their advertising budget is probably higher than a typical business - but it is a risk that they took and it will most likely pay off...
Social networking is just another tool, when used properly, can make a difference - is it the cure all to a businesses woes - probably not...
...those who see it what for what it is
They will be the ones that benefit
I think facebook will be a powerhouse for a while. Eventually they will come up with a way to really monetize FB. Once they do that I think it will be tough for new social networks to compete. It's just like the stronghold google has on the search engine market.
I also agree with Andy. Social Sites like facebook and myspace are not the place for advertisement. Yes they can advertise but users are more focusing with building a good relationship with their friends. But I know that there are also social sites that are purposely made for advertisement. Like selling products and services.