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| 2003-12-08 | Social networking sites: The future of classified advertising? |
By Mark Glaser
NEWS
- Social networking sites: The future of classified advertising?
- IGN, GameSpy merge to create gaming giant
- IE could deliver fatal blow to pop-ups
RESEARCH
- NetRatings: Seniors coming online in droves
- European Roundup: More time spent online; ad $ to rise
- WebSideStory: CNET bags highest conversion rate
NEWS
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Social networking sites: The future of classified advertising?
Newspapers can ill afford to lose more of their classified ads to online upstarts like Monster and Craigslist. But if you can't beat 'em, join 'em. Knight Ridder and The Washington Post Co. both put in money in a $6.3 million financing round for social networking site Tribe Networks, whose Tribe.net aims to dominate "person-to-person online classifieds." Part of the deal is finding a winning classifieds formula online; the other is tapping the hot social networking area, in which Friendster dominates. These sites help people connect with new friends, and friends of friends, etc. None have made money, except from venture capitalists trolling for a dot-com redux.
Knight Ridder Digital CEO Hilary Schneider told E&P she sees Weblogs and sites like Tribe.net as a way to keep things local and connected with readers. "We think user-generated content, powered by social networking, has potential to drive traffic, revenue, and listings in our local markets," she said. Tribe Networks also has one other valuable asset in its hip pocket: a patent on social networking technology (shared with LinkedIn), according to the San Jose Mercury News. With so many sites -- Monster, Evite, Yahoo, and others -- looking at social networking, that patent could be a nice asset.
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Publishers bet on Friendster-like service (News.com) |
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Knight Ridder, Wash. Post Invest in Tribe.net (E&P) |
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Knight Ridder's Web Focus: Local, Local, Local (E&P) |
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Social networking a tech battleground (San Jose Mercury News) |
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Social Networks Get New Friend$ (NY Post) |
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IGN, GameSpy merge to create gaming giant
In a move that surprised even its own editors, IGN Entertainment and GameSpy Industries announced a merger that would create the leading gaming information company online, with 22 million unduplicated visitors per month. MediaPost's Ross Fadner noted that the merged company's audience "will dwarf the next closest competitor, CNET's GameSpot," and provide fertile ground for advertisers trying to reach the TV-averse 18 to 34 year old males. Plus, the sites are complementary -- and will remain branded separately -- with IGN offering strong console news and message boards, and GameSpy's downloads and technology. Online scuttlebutt quickly turned to possible axed sites in the merger. One surprised IGN editor, Steejee, said he had to read the news on both sites to make sure it was real. "Someone go down to Hell; they'll probably need their heating system checked," he wrote.
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Gamer Sites Conjoin To Dominate Market, Place CNET Into A GameSpot (MediaPost) |
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IGN and GameSpy to Merge (Voodoo Extreme) |
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Video Gaming Companies IGN, GameSpy to Merge (Reuters) |
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IGN & GameSpy Join Together (Cubed3) |
IE could deliver fatal blow to pop-ups
Pop-up advertisements are a push/pull force. Readers want to push them away, while advertisers such as Orbitz have embraced them as an artform. On one side are web publishers that sell pop-ups or pop-unders; on the other are technology companies such as EarthLink, AOL, MSN, Google, Yahoo, who offer pop-up blockers. With the news that Microsoft would add a pop-up blocker to the next version of the Internet Explorer browser, IAR wondered if it was "game over" for pop-ups. The big question is whether the blocker would be on by default, or whether users would have to turn it on. Though many ISPs offer blockers, only 20 percent of all surfers use them, according to Jupiter.
News.com's Stephanie Olsen noted that pop-up ads actually jumped from 3 percent to 7.4 percent of all ads served in Q3 2003, though much of that boost came from Orbitz. Olsen found that publishers could use technology to get around the blockers, but probably would move on to rich media or other formats. Big brand advertisers likely wouldn't be effected, but smaller advertisers such as casinos would have to come up with a Plan B. "Anything that forces sites to design their sites better is a good thing," one agency exec told Media Week UK. "It may well cause some pain in the short term. Long term it's great."
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An End to Pop-ups? Advertisers Wince, Then Shrug (IAR) |
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Yahoo! Joins Cadre Speeding Demise of Pop-Ups (Internet.com) |
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New IE may burst pop-up bubble (News.com) |
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Microsoft to kill-off pop-ups (Media Week UK) |
RESEARCH
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NetRatings: Seniors coming online in droves
They might be one of the last demographic groups to discover the Net, but seniors aged 65+ are now going online in ever increasing numbers. Nielsen//NetRatings reported they're the fastest growing age group going online, with a 25 percent jump from October '02 to October '03. Female seniors jumped 30 percent in that year, and are now viewing 14 percent more pages per month. CBS MarketWatch reported that some hurdles remained for seniors online, as a separate Nielsen study showed that web sites are twice as hard to use for Americans over 65. The problems include small type sizes and a lack of contrast, and pages that were designed for other designers or kids. Companies will "have to connect with these older Americans," an AARP exec told CBS MW. "You have to adjust the experience to service them better, so they can interact with you."
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Increased use hasn't made Internet friendlier to seniors (CBS MW) |
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Net is Now a Good Place to Reach Seniors (iMedia Connection) |
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Internet growing more egalitarian (Sun Sentinel) |
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Senior Citizens Lead Internet Growth, According To Nielsen//Netratings (NetRatings release *PDF*) |
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European Roundup: More time spent online; ad $ to rise
There's more proof that we're living in a very connected global society. While recent research shows that U.S. online advertising and online media consumption are on the rise, similar studies in Europe show a parallel universe across the pond. Millward Brown found that the Internet made up 10 percent of Europeans' media consumption, topping the 8 percent that magazines tallied -- and barely trailing newspapers at 13 percent. TV still dominated at 41 percent, though 45 percent surveyed said they had traded in some TV time for the Net. Also, OPA Europe surveyed its 12 member publishers, who forecast overall online advertising growth at 15 percent in 2004, with "premium publishers" gaining 20 percent more traffic.
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Net gains ground on old media (Media Guardian) |
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Internet overtakes magazines, says survey (Netimperative) |
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Internet beats magazines among Europe's consumers (Revolution) |
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Online Advertising in Europe will grow by 15% in 2004 (OPA Europe) |
WebSideStory: CNET bags highest conversion rate
Advertising clickthrough rates are nice, but it's conversion rates that raise the eyebrows of advertisers. And CNET's search engine recently topped the charts on visit-to-order ratio on consumer electronics sites surveyed by WebSideStory's StatMarket. In the third quarter of 2003, CNET got 1.64 percent of all visitors to make a purchase, 28 percent higher than the next highest site, AOL. MediaPost noted that shopping-specific search sites were not included in the study. The study was based on more than 10 million search engine visits to various e-commerce sites, which sell a range of gifts, electronics and services. All sites surveyed -- including Overture, MSN, Google, Yahoo, Lycos and others -- use WebSideStory's HitBox Web analytics. See the release below for all the results.
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StatMarket: CNET Nets Higher Conversions (MediaPost) |
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CNET Ranks as Top Converting Search Engine at Consumer Electronics Sites (PRNewswire) |
OF NOTE
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Ad Buyers, Sellers Rip Online Audience Data Accuracy (AdAge)
Media buyers and marketers want the two main providers of online data to improve their research, especially their at-work panels
http://www.adage.com/news.cms?newsId=39250
Hunting for the Next Cool in Advertising (NY Times)
As more people are surfing the Web, fewer are watching the tube -- so what's an advertiser to do?
http://www.nytimes.com/2003/12/01/business/media/01adco.html
IVillage Remains Upbeat (Dow Jones)
Citing 'strong momentum' in Internet advertising, company reiterates forecast for sequential revenue growth in the fourth quarter
http://www.smartmoney.com/bn/ON/index.cfm?story=ON-20031201-001224-1825
Wayport to Offer The New York Times Electronic Edition for Free to Travelers (PRNewswire)
Agreement with NewsStand gives travelers free full-content digital edition when using Wayport's locations nationwide
http://biz.yahoo.com/prnews/031201/dam013_1.html
Choosing the Right Registration Model (E&P)
As more sites turn on registration systems -- requiring users to submit demographics -- there's a need to figure out where best to put the registration wall
http://www.editorandpublisher.com/editorandpublisher/features_columns/article_display.jsp?vnu
_content_id=2041199
Don't rely on eyeballs: Ad revenue may be up 27% but there are still thousands of sites competing for that money. One of the biggest mistakes of the last boom was assuming that the increasing popularity of the web would make big companies move huge amounts of their ad spend online. They did not then and they won't now. Look after the pennies: Things are looking up. We're all making more money than we did last year. Share prices are heading north. Now let's stop and remember that Boo.com wiped out the entire industry by burning $100 million in a few months. Resist the temptation to use any increased profits to set up offices in 35 countries or to sponsor the next Mars probe.
Paul Carr, editor of the London News Review
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Let's have another boom not a Boo (The Guardian) |