Thursday, 27 March 2008

Which way now for social networking?

As would be expected from The Economist, a recent article reviewing the current position and future opportunities for social networking sites provides an intelligent and perceptive assessment of this latest online trend, prompted by AOL's recent acquisition of Bebo, the 3rd largest social networking site.

It compares the development of social networking sites now with the advent of online email services a decade ago, and concludes that, although both provide an excellent utility that attracts millions of regular users, the opportunities for direct 'monetisation' may be more limited. The article also considers how the current format of social network sites is 'closed' to the outside web but that future developments are expected to make these more integrated with other online activities and so become a more powerful and effective utility for web users, whether or not they end up making the type of revenue expected from the current valuations of these companies.

From an alternative perspective, AdWeek reviews the growing activity of 'conversational marketing' through social networking sites and the difficulties currently faced by advertisers with how to measure the success of their campaigns. There are few accepted metrics in place to measure the 'success' of social media marketing and some advertisers feel that the way these sites are used lend themselves to less effective brand building through banner advertising.

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