Now,
Digg Unveils a Social Ad Platform
Digg, a
leading social news site, is allowing people to rank the ads based on
their likes and dislikes. Its new ad platform applies the same voting
system it uses for news to advertising. It says Digg Ads will look like
user-submitted content but will be marked as sponsored.
Social
networks have been experimenting with different advertising and business
models to improve their viability. While most are still struggling to
attract consumers, majority of consumers are hardly interested in ads
displayed on social sites.
There
are very few Internet users who are interested in buying based on
product promotions on social media sites. While 83% of the Internet
population (ages 13 to 54) participates in social media – 47% on a
weekly basis – less than 5% of social media users regularly turn to
these sites for guidance on purchase decisions. A new report by
Knowledge Networks revealed this last month. According to the report,
only 16% of social media users say they are more likely to buy from
companies that advertise on social sites. (Read:
Can Social Media Help You Sell?)
With
similar findings research firm
IDC says ads on social networking services
(SNS) have lower click-through rates than
traditional online ads and they also
lead to fewer purchases. IDC expects that lower-than-average ad
effectiveness on SNS will continue to contribute to slow ad sales unless
publishers get users to do something beyond just communicating with
others.
Even
YouTube, a seemingly popular social media site for
video sharing, is struggling and costing the owner Google
$1.65 million a day. The revelation comes from Internet Evolution that
discusses the future of Internet.
Like deep-pocketed
Google invested in YouTube, most of these social networks are surviving
on investors’ money. Facebook too has just raised some capital.
Digital Sky
Technologies, an investment group with stakes in Eastern European and
Russian internet businesses, has made a
$200 million investment in Facebook.
And
Twitter, which was launched in 2006, says: “While our business
model is in a research phase, we spend more money than we make.” (Read:
Twitter TV On, Twitter TV Off)
According to Digg, it’ll empower its community to vote and move the ads
up or down. Marketers, it says, will get real-time feedback on the
performance of their advertising messages, ensuring effective campaigns.
To
target marketers and display ads business,
Yahoo! has introduced its display advertising
solutions for marketers. They will leverage third-party
advertising technologies from display advertising solutions providers,
Teracent and Tumri. The solutions will be for the Web as well as mobile
phones.
In the
current online market development phase, most publishers as well as
advertisers are trying to operate aggressively. The U.S. and U.K.
markets are particularly showing a lot of potential in the online
advertising business. (Read:
Top 25 Ad Networks in the U.S.)
and (Read:
Top 10 Online Ad Leaders in U.K.)
The
Digg Ad platform will roll out to the site in several phases, beginning
with the integration of ads that appear alongside organic content on the
Digg website. As users “Digg,” or vote up, ad content, they’ll see the
best and most relevant ads more often, while lower performing ads will
be seen less until they are priced out of the system.
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