Advertisers steer clear of social networks

Apr 16, 2008 by Dirk Singer

Two stats this year from the European Interactive Advertising Association:

More than half of UK web users used social networks in 2007 (at the same time Ofcom showed that the UK has the second highest level of participation in social networks after Canada and ahead of the US). And the PC now has a higher viewing share than the TV among 16-24 year olds.

However, as the following article from eMarketer says, major brands are shying away from advertising on social networking sites.

Linus Gregoriadis, head of research for E-consultancy is quoted in the piece saying:

“Companies are still trying to understand what social media means for them and how they can leverage it.

“Advertising on social networks such as Facebook is extremely cheap,” said Mr. Gregoriadis, “which reflects the perceived value of display advertising on sites where users are typically not interested in looking at adverts.”

Exactly. Your ad is probably the last thing they want to look at. Given the important role user generated content plays in social media, far better to enter the conversation by supporting, sponsoring and hosting content creation.

Or be bold and give away your own content for them to own and play around with, as Radiohead has been doing recently.