@ UBS Media Week: FIM’s Michael Barrett: HyperTargeting Yields 50 Percent Premiums

Fox Interactive’s Michael Barrett kicked off his presentation at the UBS Global Media & Communications Conference in a feel-good manner, talking up all of key players in the industry. But after establishing that it’s a boom time in the space, the chief revenue officer of the News Corp. (NYSE: NWS) unit drove home the point that MySpace is the king of the hill, in terms of usage and in terms of an established advertising strategy. While Facebook management stutters its way towards making money, Barrett comes off as confident and comfortable with the company’s plans.

MySpace vs. Facebook: “In almost every instance (metric), MySpace is around two times greater than Facebook.” Traditionally, there’s been one winner, which has made marketers reticent. Now that there are multiple established sites, marketers don’t feel the need to pick the one winner. Engagement: MySpace users spend more time on the site. Both sites, ultimately, are thriving. “Although Facebook’s growth has been meteoric, it is with precedent… MySpace still the clear leader.”

Privacy and Beacon: There is clearly a lot of interest in Washington towards regulating targeted marketing. The #1 request among users is not to cut the ads, but to be served targeted ads. Advertising can add to the utility and member satisfaction of the site. “Going about it in a very upfront way…we die if one day Cherry Coke is magically part of your Top 8 friends.” There is no mining of data that’s behind a wall. All of the data is being mined.

International: International growth continues to be very strong. Now in 22 countries. Western Europe, Australia very big. Latin America growing strong. Plan is to expand in 6-10 more countries this year. More after the jump.

Marketing via MySpace :Brands can take over the MySpace homepage as a means of boosting buzz overall. Marketers can then fine tune their campaigns, integrating within certain areas of the site, while reaching specific consumers. “Advertisers like safe environments.” Over half of the pages on MySpace are ‘PG.’

HyperTargeting: “People are expressing their interests or passions on their profiles.” Company can serve them appropriate ads that dovetail with their interests, increasing CPM yields. Gives an example — technology can identify what somebody is interested via various profile clues. People are then put into one of 10 buckets, including sports, gaming, movies, music and TV. These break down into another 549 segments. Within sports, a person may be put into college football, baseball, soccer, NASCAR, etc. “It really delivers upon the original promise of the internet… one-to-one marketing.” Average CPM lifts in the 50 percent range through HypterTargeting.

Community branding:. Companies can create community sites (essentially profiles) for brands, as means of viral marketing. MySpace will work with a partner to get it going. Over 865 brand communities have been created and more in the pipeline. Initial surveys show that users feel much more positively towards brands after these campaigns are run.

OpenSocial: Social applications are the next step beyond communities. “Advent of a whole new slice of business.”

Google: Google (NSDQ: GOOG) is participating in display ads, but much of their advertising is in the form of text ads within a banner. Not ideal, but Google is an important partner in selling remnant ads. There’s no economic relationship to OpenSocial.

Mobile: “Our original strategy was to partner with the mobile carriers to create applications that were premium applications.” But, this became prohibitively expensive, when you factor in monthly fees and data changes. Now the focus is on the WAP site. Now the site is garnering 150 million page views per month, “without significant promotion.”

Video :Big upside in user-generated content, since MySpace hasn’t done anything with it. Company will go into beta with attempts to monetize user-gen video next year. Plan is to “take a look at the most popular videos (and) make sure they’re clean.” Top videos can be put into a queue for advertisers to run ads on. Ad format will be less about pre-roll and more about overlay tickers. CPMs estimates of $2- $14, although for the most part there’s no expectations.

“Why people prefer MySpace”: MySpace is a blank canvas where you can do wacky, creative things. Facebook is a utility. “MySpace presents a more genuine picture of a person” — more geared towards sharing in a self-reported public way, which opens up better opportunities for targeting advertising and marketing. On MySpace it’s easier to find friends. “We hear that time and time again that it’s easier to connect with people that you don’t know on MySpace.” (Contrast that with what Rupert Murdoch has said about MySpace being safer than Facebook.)

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