14 DAY TRIAL // Social networking usage has certainly been on the rise in recent years, though revenue hasn’t been on par with the number of users. That is changing though, as advertising spending on social networks is now expected to rise faster than previously anticipated.
eMarketer has provided some updated estimates for advertising on social networks globally. The estimated figures have grown considerably from the previous ones.
In total, advertisers are expected to spend more than $3.3 billion this year, and the number will grow to more than $4.2 billion in 2011. The data shows spending at a little over $2.5 billion in 2009, with $1.4 billion in the US and the rest in other regions.
The figure is estimated to grow by 31 percent in 2010 and the global market is expected to catch up to the US, with $1.62 billion versus $1.68 billion in social networking ad spending. By 2011, the global market will be slightly bigger than the US one.
Unsurprisingly, Facebook will be the biggest player in the market. The company is estimated to have made $500 million in 2009, grabbing 36 percent of the market in the US.
In 2010, half of the money spent in the US on social networking advertising, $835 million, will go to Facebook.
The biggest loser will be MySpace which will see its revenue from advertising dwindle from $445 million last year to just $323 million in 2010, with its market share going from 32 percent to just 19 percent this year, in the US.
The report also makes an estimate for ad spending in social games. While social gaming companies are becoming big business and fetching high valuations and prices, ad revenue is expected to stay pretty much flat.
Companies such as Zynga make most of their money from selling virtual items and not advertising, but with the growth social games are seeing, some ad revenue growth would be expected as well.
