US: Online advertisers pour money into social networking

Posted by Allie Judson on November 6, 2006 at 12:38 PM

The growing market of social networking sites has not only attracted eager teenagers but marketing agencies as well. Sites such as MySpace, Bebo, and Piczo have caught advertisers attention. Wednesday eMarketer released a report predicting high spending for online advertising on social network sites.

U.S. advertisers are expected to pay $350 million dollars in 2006, this estimate is up 25% from previous predictions, and $2.2 billion in 2010, up 16% from previous estimates. And in 2010 social networking adds are estimated to make up 8.5% of the U.S.’ total advertising budget.

This isn’t only an American market. Now that social networking has attracted an international crowd, advertisers have followed. MySpace’s international sites have grown by 245% in the last year making it a desirable destination for advertising dollars.

Though the market is there some advertisers are being cautious about customer response. Networking opens up arenas for advertised product discussion which can put a negative spin on adds appearing on the sites.

Advertisers might be moving too soon as it seems these sites might just be another fad.

Source: Red Herring

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