Yes, Banner Ads Also Suck On Application Pages : SplashCast Blog

Yes, Banner Ads Also Suck On Application Pages

Posted on April 23, 2008
Posted by Mike Berkley

Earlier this afternoon TechCrunch published a summary and analysis of the Web 2.0 Expo panel discussion, “The Facebook Platform: Finding Success in the Facebook Economy”. The general consensus among the panelists is that Facebook application developers are struggling to generate meaningful revenue via advertising and that there isn’t much hope on the horizon.

All panelists agreed that CPM rates on Facebook are miserably low, perhaps averaging 15 cents. Developers have begun experimenting with other sources of revenue, such as the sale of virtual goods and premium services, but advertising still generates more than 80% of the platform’s revenue.

Yes, $0.15 CPM is absolutely hideous, borderline criminal! That’s $150 bucks for 1,000,000 ad impressions.

But folks, understand this: whether they appear above an application or in a side column, BANNER ADS SUCK ON SOCIAL NETWORKS. Period. The issues that developers have in monetizing applications is the same problem that Facebook itself has monetizing all their other pages. Banner ads are unwanted, irrelevant, anti-social, and essentially blocked out by teenagers and young adults.

Application owners, just like Facebook and MySpace themselves, need to think beyond the banner ad. In social networks, ads need to “become part of the conversation” (the new social media cliche). The line between content and ad needs to blur, or vaporize altogether. Ads need to become personal, social, and dynamic. And ads need to provide immediate value to the consumer, either in the form of utility or entertainment. Yes, ads must work harder in social networks to be accepted by this incredibly discerning audience.

Otherwise 10,000 application views might buy you a pack of Hubba Bubba bubblegum.

Comments

6 Responses to “Yes, Banner Ads Also Suck On Application Pages”

  1. Thiago Guerra on April 24th, 2008 6:19 am

    Do you remember the advent of CRM or even better, the advent of CRM Software? Few companies really knew how to use all the tools and few made money right away with it. For me, social networks are experiencing the same. Really few know how to monetize the amazing data they have available but it doesn’t mean that this is not a big milestone.

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