Nearly $2 Billion Projected For Social Networking Ads By 2010 - InformationWeek

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Nearly $2 Billion Projected For Social Networking Ads By 2010

Driving the spending, according to research firm eMarketer, are companies with businesses built on creating buzz. Hollywood is leading the way, experimenting with strategies targeting social networks that include creating profile pages for movie characters.

U.S. companies are expected to spend an estimated $1.8 billion at MySpace.com and competing social networking sites by 2010, up from $280 million this year, research firm eMarketer said Tuesday.

Companies with businesses built on creating buzz need to tap into social networking destinations such as MySpace to effectively market their wares, said eMarketer senior analyst Debra Aho Williamson.

"There are banner ads and profile pages that marketers set up on MySpace," Williamson said. "We project MySpace's ad revenue will hit $180 million this year. They will take the biggest chunk of ad revenue of all the social networking sites." Still, social network ad spending will account for only 1.7 percent of the $16.7 billion spent on U.S. online advertising in 2006, rising to 6.3 percent in 2010, Williamson said.

Williamson calls the strategy of targeting social networks for ad spending "experimental," but Hollywood studios are in the forefront when it comes to connecting with movie fans through social network sites. Warner Independent Pictures launched in April a site on MySpace.com to promote the movie "A Scanner Darkly" in an effort to connect with moviegoers.

When Sony Pictures Entertainment recently released the movie "Monster House," the studio posted character profiles on MySpace.com to attract consumers of all ages to a movie they otherwise might not have seen.

Character pages appear to tend to work best, especially on MySpace.com, where users can become "friends" with character. For example, Sony created a profile page in the voice of Jill before launching the movie "When a Stranger Calls." "Jill had 89,000 friends when we opened the movie, and nearly 110,000 friends by the time the movie went into the home entertainment window," said Dwight Caines, executive vice president of worldwide digital marketing strategy for Columbia TriStar Marketing Group at Sony Pictures Entertainment. "Jill had a blog where she talked about being grounded and having her phone taken away. In the blog, she asked people to add her to their buddy list."

Caines said in the four to six weeks leading up to the opening of the movie, there were about 440,000 individual sessions generating 31 million instant messages (IM) going back and forth between consumers and Jill. There were approximately 430,000 phone calls to the toll free number. "We figured out how to take the movie campaign off a Web and live in a place where kids spent a lot of time, which allowed them to connect with the young girl," Caines said.

Later this week, Warner Independent Pictures will launch the site www.howdoyoudream.com with RES Magazine and social networking site imeem to promote the movie "The Science of Sleep." "For Michel Gondry's 'The Science of Sleep,' we partnered with RES Magazine and imeem to build a 'How Do You Dream' community site where people can enter their own dreams and see other people's dreams, and their entries will prompt exclusive images and video from the film," said Laura Kim, executive vice president of marketing and publicity for Warner Independent Pictures.

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