MySpace Revenue Down Because Banner Ads Suck
Posted on May 8, 2008
Posted by Mike Berkley
Fox Interactive Media (FIM) revenues are down by 10% last quarter, and FIM also missed their revenue target for the fiscal year by 10%.
From Techcrunch:
The culprit: There is too much inventory and not enough clickthroughs. As a result both brands (and, more importantly, “friends” on MySpace) remain skeptical. Dumping ads on MySpace without targeting them simply doesn’t work.
True… but I would argue that even highly targeted banner ads won’t solve the problem for MySpace. Click through rates are miserable not so much because advertisers can’t differentiate between a 14 year-old girl versus an 18 year-old boy… but because:
- Teens are generally not in an “ad receptive mode” when they are socializing and communicating on MySpace or Facebook, and
- Teens have learned to block out force-fed advertising, such as display ads. This is why opt-in, social advertising is becoming such a compelling alternative for advertisers.
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