In our view, a majority of current social ads are just “ads on social platforms” rather than “social-enabled ads”. These advertisements seem to boast no prominent differences with display ads on other online platforms (e.g. portals), which are primarily delivered on the back of user reach and visits. Currently, social-oriented platforms still do not seem to have efficiently leveraged the social / interest analytics graphs of their users, although some pioneers (e.g. Facebook and Twitter) have been actively testing new ad formats to target better.
Current Size of Social Advertising in India
The native social advertising revenues in the U.S. was USD 1.6b in 2012.
Facebook and Social Graphs
Facebook launched a user-focused search service, Graph Search, in January this year, allowing users to search for the friends, locations, pictures and interests of a specific Facebook user. Three months after its launch, the company reportedly has begun to test Graph Search-based advertising. Unlike traditional search ads which are based on keyword inputs, the Graph Search ads will be centered key attributes of a user, such as age, gender, location, employment, “likes” and open graphs. We view the Graph Search ads as enabling the “social features” in advertising, thus possibly offering a unique value proposition compared to traditional online advertising formats.
Tencent’s Social Advertising in China
Tencent’s major social-oriented platforms (e.g. QQ and Qzone), allows advertisers to target customers according to their attributes, thus improving the ad performance. We expect the system to become an important growth driver for Tencent in the long run.
The Battle is on for the Ten Billion Dollar Social Advertising Wodlwide as Google looks on with its 3rd Rate Quality Google Plus Network finding no Traction in the Market 🙂