Tag Archives: facebook

Social networking Ad effectiveness.

Last year was the year of social networks, namely Facebook has been its star. With an average yearly growth rate of 550% .

World wide faeebook is closing on myspace #1 lead in social networking arena to equal it to around 100 million unique visits a month. It is in Alexa’s top ten, and it is number one world wide photo sharing website more than flickr.

In the arab world facebook become number on social network beating Hi5. Facebook now is on top 5 most visited websites in the arab world which include: Google, yahoo, msn, and maktoob.

On the business professional SN front, linkedIn and Xing has grown a lot, Linkedin remain a leader with around 17 millions profile, with a growth rate at an average of 182 percent yearly.

Facebook and Bebo charges only 13 cents per thousand times that an ad is ‘served,’ or CPM. Yahoo’s average CPM is estimated at $13. Video ads on Myspace is $25 per thousand showings while CBS charges $50 and NBC charges as much as $75 for the same number of views.

Why is consumers Social networking Ad rate is lower, I think because Advertising in consumer social networks is less effective to other web sites.

According to an online marketer in the Arab world who ran ads in faebook, facebook click through rate (CTR) is the lowest in the industry, the obvious reason is that users are busy interacting with their friends than looking into ads, the other reason is that ad location is not visible to the user, they are even on the left side under the app menu or at the bottom of the page.

Another evidence is Google executives complains about how hard it is to monetize social networking traffic.

Fox Interactive gets 27 percent of its revenue from an ad deal between Google and MySpace forged in August 2006. A deal in which Rupert Murdoch gets $900 million, the guaranteed revenue Google promised MySpace through 2010. So now google is loosing money with myspace ad deal.

Contextual text ads to users’ Personal profiles are not as effective as contextual text ads on search or a news website.

On the other hand LinkedIn has a CPM rate of $75. why? LinkedIn caters to a professional business audience and so the advertisers have a narrower business audience.

LinkedIn also has contextual text ads from google’s ad sense, which I found interesting where I some times I click on these links. Because they are related to things in my profile and business interest, some thing I would like to increase my knowledge about.sometimes locate a competitor.

How many times did an ad got your attention and how many times did you click an ad across social networks.

Please leave your comments and tell us about

your ad experience across social networks………………….

UP DATE: there are new reports that backup my assertions, and i will post them soon.

My Experience with developers in Jordan.

I worked in several IT companies in Jordan and dealt with few programmers. So I can sum my impression about them as the following:

MEssssssssssssssssssss

1- if they know programming that is what they know, they might be good at it but they are not creative.

2-Lack of entrepreneurial spirit:

how many programmers took the risk and started up their own businesses. Very few and if they did it would be custom app development.

3- lack of vision:

most developers in Jordan do not have a vision of how technology and the web will evolve.

4- I never know or heard about any Jordanian programmer who founded or confounded world class IT business like a web site or a web 2.0 business. If any did they mostly were a localized copycat of US website or a software.

5- working with Jordanian freelancers is a nightmare:

they promise you and then you get nothing. I dealt with many liars. In Arabic:Nasabeen.

6- Arrogance no risk taking:

if you want to cofound a company with a developer, he will think that he is every thing, and that his work is the most important and nothing else. This is wrong, in USA there are tons of startups every day, why not all of them succeed? What maters most is the idea how much value you offer to the end user compared to your competitor, that includes usability. Execution that includes: the development process and management. Marketing and PR: can you market your service in near zero cost to a wide audience to acquire the initial customer base critical for your future success, funding: to pay for your costs. Most of the ingredients of success is not done by a developer but by the management, I am not saying programmers are not important they are, one bad programmer can cause your business to be destroyed with a serious bug in the code that for ex: enable a hacker to delete your data base, but programmers are an important part of the process.


7- Too much emphasis in work security:

well it is natural that every one needs to secure a present income, but most programmers are not welling to spend their spare time innovating the next big think, they are not welling to partner with a business skilled person and start something from scratch because there is no enough funding. They will come to you after you secure the funding.

8- fact numbers 8: most IT companies who are world class businesses with 100s of billion market cap today, started from scratch some with 2 thousand $ or less seed investments, yahoo was founded at the dorms of Stanford uni, same for google, same for Dell who started with 1000 $ investment. Same with Sun, while HP started from the garage. Same with Apple. Myspace, also facebook started from the dorm .for none IT starbucks started with few thousands investment in one location, now it has thousands of shops around the world with billion of revenues.

How did these startup succeed while other did not?

1- value:

A- New product: they might have came with a new product: ex yahoo: a directory that helps to find websites- where to go across the web.

B- Improvements on existing products: yahoo directory was not enough to find what you want from the web, so google came with algorithm of a search engine and launched it services, now google is at least 5 times bigger than yahoo with around 150 billion market cap. Another example of improvements is facebook: social networking was there with friendster then myspace, but facebook improved the service with usable clean features. ( first facebook was only for Harvard students, provided a directory for students, something that makes Harvard students stay connected and help them get to know each other, a value nto offered else where for them, and then it evolved) so it started as a niche offering unlike mypsace targeting masses of teenagers, facebook initially targeted students and kept improving – innovating until now it has almost the same unique visit to myspace globally, while myspace lacked continues innovation for years it is playing now catch up game with facebook features.

2- Business model:

PC where there but what Michel Dell came with is a new business model: customize PC to each individual and use 1 to 1 marketing through mail, build to order, means he had almost zero inventory a huge cost cut, these things initially provided him with a competitive advantage to other PC vendors. While google monetized its free search engine with non intrusive contextual text ads which are effective for both advertisers and the end users.

3- Marketing and PR:

hotmail was the first web-based email, which is by it self represent 1st mover advantage, but what it did is it used Viral marketing: using your customers to bring more customers, which means free advertising for you, and a more effective way to acquire new customers, Hotmail embedded a small message at the end of every email that says: -get your free email from hotmail click here-, this term was coined by Tem Draper. The VC behind hotmail.

hotmail was sold to Microsoft for 500 million.

Another example Facebook used: address book email gapping to virally acquire more users. Also all these companies had a great PR strategy which helped them create a buzz and excitement about their products for an almost zero cost.

4- Management:

These companies had strong management people.

5- Funding:

Millions of Dollars in Funding were secured to these companies from VCs after they developed their products and acquired an initial customer base. Facebook first after few month of launching it raised 500 thousand $, then later millions up to 35 million, and recently up to 700million making its value to 15 billion.

Bottom-line: if you stumble upon a person with great idea -like me-, and with knowledge how to reach out customers, partner with him and work day and night to make it happen, you might in few years make millions of dollars

Tune in I will post a more detailed post in my blog about the ingredients of success for the successful IT companies. And soon I will launch a web 2.0 and mobile 2.0 blog in Arabic.