14 DAY TRIAL // Strategy Analytics has recently published a study which shows that social networks will attract around 900 million users by the end of the end of 2010, with the number getting at 1.85 billion by the end of 2015. Strategy Analytics is a prominent figure in offering strategic and tactical support for business planners worldwide, and its latest report is called Global Social Network Market Forecast.
The study demonstrates that even though Facebook, Twitter and MySpace will become even more popular, social network adoption varies greatly depending on regional differences.
For example, at the end of 2009, 60% of Internet users from North America and Western Europe were frequently accessing social networks, while in Asia, less than 40% were regular users.
Nonetheless, Asian Internet market is reportedly growing at a very fast pace, therefore it is undoubtedly the greatest growth opportunity for all types of web-based services, such as social networks, over the upcoming 5 years.
Martin Olausson, Director of Digital Media Research at Strategy Analytics, said: “Facebook has conquered most places in the Western World but has struggled to gain traction in many Asian markets.”
“We believe that Facebook needs to increase its focus and commitment to the important and rapidly growing Asian market if it wants to remain the world’s leading social network five years from now.”
According to the Strategy Analytics report, the same regional differences are visible in terms of revenue models for monetizing social networks from different areas.
During 2010, in North America, about 9 % of total social network revenues came from selling virtual items, whereas in Asian market virtual items sales account for almost 22 % of the revenues.
Jia Wu, author of the aforementioned report and Analyst at Strategy Analytics’ Digital Consumer Practice, explained: “While advertising has been and will continue to be the main revenue source for most social networks, revenues from selling virtual items and social network credits will ramp up rapidly in some regions.”
“Social networks, such as Tencent and Cyworld in Asia, already generate significant revenues by selling avatar accessories and virtual gifts. Based on their successful experience, we expect to see other markets to adopt this business model for gaining incremental revenues going forward.”