In April, Nielsen predicted social network advertising revenues would hit an estimated $1.825 billion. Last week, eMarketer released a new study saying advertising on social networks will drop three percent in 2009 to $1.1 billion. Whether social media advertising will grow or shrink in 2009 remains a question.
A lot has changed in social media advertising in the past two years — and not just revenue predictions. There are new players, new technologies, and new places and ways to advertise.
Social media advertising hasn’t followed the norm of existing online advertising, either. You’ve got applications, engagement ads, and widgets. Needless to say, social media advertising hasn’t made things easier for the media planner to figure out. Recognizing the particular pain the new online ad format created for media sellers, planners, buyers, and advertisers alike, a few entities have attempted to tackle the challenge.
The IAB’s Take on Social Media Advertising
In May 2009, the Interactive Advertising Bureau (IAB) released its Social Advertising Best Practices and Social Media Ad Metrics Definitions. The IAB’s definition of a social ad is “an online ad that incorporates user interactions that the consumer has agreed to display and be shared. The resulting ad displays these interactions along with the user’s persona (picture and/or name) within the ad content.”
Its guidelines go on to discuss five key factors: data used for social ads, ingredients of a social ad, context for delivering a social ad, consumer control, and privacy guidelines. Examples of social ads include Facebook’s Engagement Ad, MySpace’s Interaction Ad, Buddy Media’s Application Ad, Brickfish’s Social Media Ad, and Socialmedia.com’s Word of Mouth Ad.
For metrics, the IAB breaks the social media space into three sectors:
- Social media: These sites are “characterized by the inherent functionality that facilitates the sharing of information between users within a defined network.”
- Blog: This “is a type of Web site used by individuals, groups or business entities to publish opinions and commentary on various topics.”
- Widgets: These are “applications that can function on any site that accepts external content, including social networks, blog platforms, start pages (i.e. MyYahoo), desktop platforms or personal Web pages,” while social media applications “are software programs designed to work on one or more platforms” but that “work only on the platform for which they are designed.”
By these three categories, the IAB further breaks down measurement criteria. Some interesting newcomers to the world of online media measurement include:
- Games played
- Uploads (e.g., images, videos)
- Poll votes
- Invites sent
- Newsfeed items posted
- Comments posted
- Friends reached
- Topics/forums created
- Number of group members or fans
- Earliest post date for conversation-relevant posts
- Latest post date for conversation-relevant posts
- Meantime between posts
The New Kid on the Block
Conceived last fall and incorporated in March, the new Social Media Advertising Consortium (SMAC) grew out of needs identified by those in social media advertising industry: providers, publishers, and agencies. They came together and created a governing body to help bring clarity to their industry. SMAC’s focus is on three primary areas, which will sound similar to the IAB’s:
- Buying units
- Measurement metrics
SMAC hopes by doing so, the resulting standards will allow the social media industry to scale, innovate, and evolve responsibly and effectively.
To tackle these primary objectives, the consortium has created three corresponding work groups:
- Common vocabulary. To standardize social media terminology, this group will focus on five segments: people, platforms, actions, tools, and measurement.
- Measurement metrics. This group will tackle “measuring and evaluating social media audiences to improve advertising and marketing practices for planning social media advertising campaigns and measuring the effectiveness of social media investments.” It will also lead research initiatives on the social media advertising process. In addition to the IAB-defined metrics for consideration, I’m imagining that they’ll also want to be bear in mind terms like brand index, bookmarks, RSS subscribers, diggs, tags, product reviews, recommendations, reader engagement, connections, and more.
- Standard buying units. Standard buying units continue to evolve. How the industry considers, accepts, and defines these units must be established.
Whether these social media advertising standards already exist (IAB) or get redefined (SMAC), with this nascent industry in constant flux, undoubtedly these organizations have their work cut out for them.