Social Marketing Ad Networks, Worth Your Dime?

Social networks are growing up and advertisers are ready to tap these lucrative audiences. Yet, it is not quite as simple as it sounds. Social media and social syndication opportunities are different and more complex, challenging traditional ad networks. This makes some advertisers nervous about the effective return on their marketing dollars, which spells opportunity for savvy advertisers.

Social networks like Facebook, LinkedIn, and MySpace are inherently communities of defined interest and trust. This makes them lucrative, targeted, and self-selected segments that make advertisers mouth watering to tap these wallets. The trick is learning to stimulate buying action out of these notoriously skeptical audiences.First, lets survey the ad networks and methods that currently occupy these spaces, then we will teach you the 3-step formula for success.

Facebook
Facebook has had a love/hate relationship with advertising. An inherent challenge in social networks is the privacy balance. This has been Facebook’s primary nemesis in effectively opening their doors to advertisers.

The most promising are Facebook application networks, which are some of the most popular features of Facebook. These applications are a large part of the social interaction of Facebook, making your advertising central to the user experience. Some of the strongest players in this space are SocialMedia, Lookery, RockYou, and Slide. There are many folks in this space, so lean towards volume.

Facebook has also launched their own clever approach to advertising that leverages your advertising into Facebook users own social action. Facebook places not only relevant ads to their pages, but also to their attached to social actions (i.e., adding friends, checking galleries, and posting messages).

LinkedIn
LinkedIn is also just starting to open their golden social vault. Boasting segmentation stats like average household incomes of $100,000+, over 80% college graduates, and 49% business decision makers–this is prime real estate for business-to-business marketers.

The demand has been so great for their social audience that LinkedIn has just announced collaboration with Collective Media to add additional ad network inventory to their already existing internal ad network placing major brands.

While other social networks like Facebook and MySpace a fetching CPM for sub $1, LinkedIn is selling display CPMs in the $30-$75 dollar range and text CPMs around $30–obvious buyers in this social network.

MySpace
Meanwhile, MySpace is experiencing the same challenges as Facebook. Younger crowds with a lot of disposal income, but generally making smaller incremental purchase like ringtones, mp3s, and screensavers.

For these social audience and segment reason you are seeing a similar ad network model to Facebook-third party applications, video and audio monetization, and some “hyper-targeted” internal MySpace ad network activity.

MySpace certainly has the volume and segmentation for direct consumer buying, but, it takes a savvy advertiser to arbitrage this thin margin.

Creating Social Marketing Success
having considered the different options in social media syndication and advertising, the key to big returns is making it socially natural. Unlike other advertising venues and ad networks, success in social networking is about making your ads and personas in the community work together to create a conversation about your product, service, or brand.

This is the 3-step formula to social networking and social syndication success:
1. Be a community member first
2. Engage with one or more personal brands (or social personas)
3. Socialize your sales and customer service (great example include Zappos, Southwest Airlines, and Comcast)