New Study Reveals Interesting Data on Social Media Advertising

Some new data put out by the Pivot Group, reveals some interesting data on social media advertising. In the chart provided below, respondents provided their answers about how they’re currently using social media, and how they intend to use it in the future:

The Breakdown of Spending on Social Media Networks

The Breakdown of Spending on Social Media Networks

Some of the trends that we see if the chart were to be expected, such as the downward spiral at MySpace, and their relative lack of market share in ad spending.  Another not-so-obvious player to most people is Zynga…the social media gaming company that offers in game advertising/messaging. The social media gaming space is hot, and Zynga’s seen a nice bump in ad revenues because of it.

We see a lot of experimentation going on with social media advertising, with many businesses scambling to find the right mix of properties to advertise with. The fact remains that certain businesses are going to be more suited to placing ads on certain social media properties versus others. For instance, MySpace has a very young, music oriented demographic, while Four Square is much more suitable for hospitality-oriented businesses. As with all other forms of marketing, it comes down to understanding your target demographic…we can’t lose sight of this. 

The data also points to the fact that advertisers are much more inclined to look outside of the top few social media sites in order to experiment with better return on investment possibilities. Often, when a social media property gains a lot of quick momentum, but hasn’t become saturated with advertisers, a great advertising “arbitrage” opportunity exists (to use a financial term). We saw this with the “bargain” per-click rates that Facebook was offering a few years back. We see some of those opportunities for low per-click rates opening up on some of the secondary social media properties right now. It all boils down to supply and demand.

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