Social media’s newest advertising weapon

During the early years of social media, advertising was all about real estate.

Companies placed their messages in small spaces alongside newsfeeds and status updates, hoping to catch users’ eyes.

The problem was that users quickly trained their eyes to stop looking at those locations, tuning out the advertisements.

Going forward, though, social media advertising will be more difficult to ignore.

Sites are increasingly incorporating advertising organically into their content, such as including promotions in a Twitter stream or Facebook newsfeed, making them all but inescapable.

This approach, called native advertising, will help spark a huge increase in social media ad spending over the coming years, as brands push to become part of the conversation rather than just adjacent to it.

A new report from BIA/Kelsey, the Chantilly, Va., local media consulting and research firm, projects that social media advertising will grow from $4.6 billion this year to $9.2 billion by 2016.

Total social media ad spending will grow at a compound rate of 19.2 percent in that span. While social display ads, the traditional format, will increase at a rate of 15.2 percent, native ads will pump along at a growth rate of 26 percent annually.

Native advertising will increase from $1.53 billion this year to $3.85 billion in 2016.

News today seems to support BIA/Kelsey’s bullish outlook for native advertising.

Several analysts raised their outlook for Facebook stock, following six rocky months since its debut, crediting in part new advertising opportunities such as promoted posts, which insert ads directly in users’ newsfeeds.

By using such methods, predicts Bernstein Research’s Carlos Kirjner, Facebook will “become something different from (and better than) a very large display advertising publisher.” He bumped up his outlook for ad spending on the social network next year to $6.2 billion.

It’s been a long slog for social networks to reach the point where their advertising showed this much promise.

In its relative youth, before MySpace gave way to Facebook as the world’s No. 1 social site, social media made advertisers nervous.

There was no way to predict what sort of content their ads would appear next to, a big concern during the early days of internet advertising.

But as social networks have become more popular, with Facebook recently surpassing the 1 billion member mark, those concerns have fallen by the wayside, and now the big push is to integrate advertising more seamlessly into the sites, as well as find more mobile social media advertising opportunities.

Native advertising delivers in that area as well. With the ads integrated into content, there are fewer worries about users overlooking them on smaller devices.
 

Tags: ad spending, ad spending social media, ads, advertising, bia/kelsey, facebook, forecasts, media, outlook, social media, social media ad spending, social media advertising, social media spending, twitter