NEWS: Don’t LOL: Social Ads Rev Up Revenue

Ed: With in-panel, in-tab, in-game, and in-video advertising, the metrics companies can't keep up with the multiple dimensions of change.

Don’t LOL: Social Ads Rev Up Revenue

June 16th 2008 by Peter Vogel  

ADOTAS EXCLUSIVE — Headlines of doom and gloom continue to forecast that social media will never produce the piles of money that marketers have dreamed of...

Lafleur from Cubics (AdKnowledge), Siqi Chen, Founder of Serious Business, (creater of Friends For Sale!) and Charles Yong, Founder of DeveloperAnalystics.com, all confirmed that there are individual developers out there making more than a million a year, often from just one application. Many developers are making $10,000 to $20,000 per day.

Many of the bigger advertising networks like Social Gaming Network, Cubics, Social Media, RockYou and $uperRewards aren’t yet willing to provide concrete numbers. It’s estimated, though, that these companies are also cashing in to the tune of several hundred thousands of dollars profit each month, and even many more times that figure for some of the biggest companies. Obviously profits are lower for those expanding quickly and building for the future, but they will be positioned to become even more successful.

Teens Learn From Advertising on Social Sites

OTX, releasing new results from its Teen Topix study, the complex lives of the 13 -17 year old set, found that teens are spending an average of 11.5 hours online, doing everything from instant messaging and visiting social networking sites to shopping and listening to music, but dispels myths that this group wants to do everything online.

Jane Buckingham, President, The Intelligence Group, concludes that "Teens are not a ‘one size fits all' market and the… report show this group to be complex, sophisticated consumers and media users… "

Given the choice, though, teens prefer real friends to online friends, date someone from school over someone from the Internet, and shop in a store to shop online,

Ranking Paired Preferences (Teens aged 13-17)
Would you rather…	% or respondents	OR…	% of respondents
Have a lot of "real friends"	91%	Have a lot of "online friends"	9%
Date someone you know from school	87%	Date someone you meet on the Internet	13%
Shop in a store	82%	Shop online	18%
Watch a full length program on TV	81%	Watch a full length program online	19%
No television for a week	74%	No Internet for a week	26%
Get information from the Internet	71%	Get information from traditional media like TV, magazines, or newspapers	29%
Give up cell phone texting	71%	Give up Internet access	29%
Get your locker vandalized	63%	Get your personal homepage of profile vandalized	37%
Be limited to a TV antenna for watching TV	63%	Be limited to a dial up connection to access the Internet	37%
IM your friend	54%	Call your friend	46%
Source: OTX, June 2008

The study did find that 24% of teens are spending more than 15 hours a week online and when all teens were asked how frequently they do typical online activities, instant messaging came up as the most frequent activity, followed by visiting social networking sites, email, searching, and visiting virtual community sites.

• 45% spent from 1 to less than 8 hours on line during a typical week            
• 31% from 8 to less than 15           
• 24% 15 hours and over           

Bruce Friend, President Media and Entertainment Insights for OTX, said "Many of (their) online activities take place simultaneously… our Longitudinal Media Experience (LMX) study confirms that teenagers are often heavy simultaneous media users." 

The study also says that 58% of teens have made a purchase online. On average teens who make purchases online are spending $46 per month, and 26% of teens are spending $50 or more. Clothes and music are the two most popular online purchases, followed by books, electronics and DVDs.

The bedroom (36%) and living room (24%) are the places teens are most likely to have their primary computer. Teens with their primary computer in their bedrooms are more likely to be heavy internet users (15+ hours per week) and spend money online.

Products Personally Purchased Online (Among teens who have purchased online)
	% of Respondents (multiple response OK)
Clothing, Shoes & Accessories	46%
Music	41%
Books	30%
Electronics	27%
DVDs	20%
Source: OTX, June 2008

78% of teens are concerned about computer viruses while online, followed by:

• Identity theft (67%)
• Unauthorized access to personal information (65%)
• Scams (60%)
• Spam (60%)

The average teen has signed up for over four social networking sites and currently belongs to two, reports the study. Teens are receptive to advertising on these sites, where the majority of teens learn about:

• Financial services (63%)
• Movies in theaters (59%)
• Mobile services and accessories (58%)
• Travel (57%)
• Other websites (53%)