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Summary:

Even if you don’t believe real-time feeds will become the dominant content consumption paradigm, they’re clearly a growing force. Consumer-paid access to real-time feeds is largely for paid mobile apps, and advertising is the immediate payoff. So here’s how social media companies can best cash in.

cash

Even if you don’t believe that real-time feeds will become the dominant content consumption paradigm, it’s clear they’re a growing force. Not many consumers pay for feeds, so advertising would appear to be the better payoff, as I discuss on GigaOM Pro this week. So how can social media companies cash in?

Today, that ad market is unmeasured but highly concentrated, although that concentration could diffuse. Facebook will likely sell over $1 billion in advertising this year, most of it around its news feed. As far as Twitter goes, a lot of tweets get viewed on third-party Twitter clients, as well as on Facebook. Somewhat similarly, Facebook is syndicating its content through initiatives like Facebook Connect and Instant Personalization.

Could Real-Time Ad Networks Jump-Start Spending?

Advertisers demand a certain scale of audience before they start spending big money. As with other media — social or otherwise — ad networks can alleviate audience fragmentation, giving advertisers access to eyeballs across a number of sites or apps. The big ad networks from AOL, Google, Microsoft, or Yahoo aren’t doing anything in the real-time space right now.

Meanwhile, a handful of startups have emerged, including 140 Proof and OneRiot, which sell inventory on Twitter clients and apps, as well as Tweetup, which also makes its own destination site. Ad.ly will construct celebrity-sponsored updates and insert them in Twitter and Facebook streams.

Ad Network Realities

Right now, the ad networks in real-time are ahead of most of the feed sites in sophistication and could help move the market forward. But in most media markets, the company that owns the biggest eyeballs commands the vast majority of ad spending.

Publishers and other content companies like to hold onto the best ad inventory and sell it directly to their best advertisers and ad agency clients. That leaves low-priced remnant inventory for the networks.

As with other media, the real-time ad network ecosystem will have to deliver targeting and measurement to capture advertiser spending. Companies like Klout and Gravity may help marketers identify influencer audiences. Kantar Media, a unit of ad agency holding company WPP, tracks offers competitive intelligence on ad networks, but hasn’t aimed at the real-time space yet.

Read the full post here.

Image source: flickr user ryanmshea

Related content from GigaOM Pro (sub req’d):

Report: Why Google Should Fear the Social Web

The Real Impact of Facebook’s New Approach to Gaming

How to Measure Social Media Advertising


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  1. Thanks David. To clarify, Ad.ly extends both celebrity endorsements and targeted ads to Twitter apps, broader “stream” apps and sites and services of all kinds.

    Folks can learn more about the Ad.ly for Apps & Sites API here: http://www.ad.ly/developer/

    Best,
    -Krista
    The Ad/ly team

  2. Krista: thanks for the clarification. Looks like a promising platform.

  3. Hi David,
    I’m the CEO of OneRiot. Good to see that you are tracking what will be undoubtedly an exciting space this year. Interested GigaOm readers can track our blog for news and announcements http://blog.oneriot.com
    I’m always happy to talk more about this. You can also follow me @tobiaspeggs

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