E marketer worldwide_social_network_ad_revenues-a_10_billion_market_by_2013

Digital Intelligence Copyright ©2011 eMarketer, Inc. All rights reserved.
The eMarketer View 2
US Social Network Ad Revenues 3
Worldwide Social Network Ad Revenues 5
Social Networks in the Advertising Mix 11
Facebook 13
Twitter 17
LinkedIn 20
Google+ 22
Social Gaming 25
Conclusions 27
Appendix: Forecast Methodology 28
eMarketer Interviews 28
About emarketer 30
October 2011
Executive Summary: Worldwide social network advertising revenues will top $8 billion in 2012 and approach
$10 billion in 2013, as marketers continue to increase their social media marketing budgets.
132429
The bulk of these ad dollars will go toward Facebook, which is
expected to draw $5.8 billion in worldwide ad revenues in 2012
and $7 billion in 2013. This year, Facebook will surpass Yahoo! to
become the leader in US display ad revenues.
Twitter and LinkedIn will also see healthy ad revenue increases,
although they’ll remain much smaller players than Facebook.
Twitter’s ad revenue is forecast to grow to $260 million in 2012 and
$399.5 million in 2013, while LinkedIn should generate $201 million
in 2012 and $249.6 million the following year.
Social network ad revenues outside the US will continue to rise
as well, accounting for 51.9% of the worldwide total in 2013, or
$5.2 billion. Social games likewise will expand their ad revenues,
reaching $641 million worldwide in 2013.
On the horizon, the launch of Google+ will give marketers a new
social network to test. The site could siphon some ad dollars
away from competitors by offering a mix of social and search
advertising opportunities that other networks cannot match.
Key Questions
■■ How much ad revenue will social networks like Facebook,
Twitter and LinkedIn generate between 2011 and 2013?
■■ Are ad budgets shifting more heavily toward social networks?
■■ Will social games become stronger ad destinations?
■■ What effect will Google+ have?
2009
billions and % change
Social Network Ad Revenues Worldwide, 2009-2013
2010
$3.56
2011
$5.54
2012
$8.04
2013
$9.99
Social network ad revenues % change
Note: includes paid advertising appearing within social network sites, social
network games and social network applications; excludes spending by
marketers that goes toward developing or maintaining a social network
presence
Source: eMarketer, Sep 2011
132429 www.eMarketer.com
49.6%
55.6%
45.0%
24.2%
20.0%
$2.38
Debra Aho Williamson
dwilliamson@emarketer.com
Report Contributors
Kimberly Maul, Tracy Tang, Mitchel Winkels
Worldwide Social
Network Ad Revenues:
A $10 Billion Market by 2013

Worldwide Social Network Ad Revenues: A $10 Billion Market by 2013 Copyright ©2011 eMarketer, Inc. All rights reserved. 2
The eMarketer View
Key eMarketer Numbers—Social Network Ad Revenues
Worldwide US
Facebook
Ad revenues worldwide (billions)
Social network ad revenues (billions)
$3.80
$7.00
$5.78
Twitter LinkedIn
2011 20132012
$2.74
$4.81
$3.90
2011 201320122011 20132012
$5.54
$8.04
$9.99
2011 2012 2013
$0.14 $0.20 $0.25
2011 20132012
$0.14
$0.40$.0.26
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More marketers than ever believe their brands should be
engaging with consumers on social networks—and advertising is
an increasingly successful tool for doing so.As a result, worldwide
social network ad revenues will surpass $8 billion in 2012 and
approach $10 billion by 2013. Spending in the US will reach
$3.9 billion next year, up from $2.74 billion in 2011.
eMarketer’s forecast for social network ad revenues, updated
from our earlier 2011 estimate, includes the following highlights:
Facebook will receive $7 of every $10 spent on social
network advertising. In 2012, Facebook will tally $5.78 billion
in ad revenues, garnering 72% of all social network advertising
revenues and 6.1% of worldwide online ad spending.This year,
it is expected to pass Yahoo! to become the No. 1 site in US
display ad revenues.
Twitter is gaining momentum. Although some ad offerings,
such as its self-serve system, have yet to launch,Twitter’s strong
engagement metrics are leading more advertisers to test the
platform.The addition of self-serve will enable more small and
medium-sized businesses to advertise on Twitter and help propel
ad revenues to $260 million in 2012 and $399.5 million in 2013.
International social network ad revenues will surpass
the US total in 2011. This year, markets outside the US will
account for more than half of social network ad revenues. A
major reason is Facebook, whose international ad revenues
have increased to 47% of the total, up from 35% in 2010. But
homegrown social networks in markets such as China, Japan
and Russia will also continue to see ad revenue growth.
Nearly 12% of US online ad spending will go to social
networks in 2013. Advertisers are shifting budgets from
search, TV and print to fund social campaigns. Several
executives interviewed by eMarketer said a goal for 2012 is to
better integrate social networks into their overall advertising
mix and understand the inter-relationships between offline
media and social media.
LinkedIn is building a solid business-to-business (B2B)
ad revenue stream. Its sought-after professional audience
and improving usage metrics will help LinkedIn increase ad
revenues to $200.9 million in 2012, up 78.5% over 2011. New
ad products that take better advantage of the information
posted by users on LinkedIn will also support ad revenue
growth, reaching $249.6 million in 2013.
Google+ will help brands pump up their search
marketing. The social network will open up to marketers in
late 2011, offering opportunities to blend social and search
in ways that were not possible before. While it’s too early to
predict how big Google+ will get, it will not need hundreds of
millions of users to be attractive to marketers.
Social gaming ads will diversify. Worldwide social gaming
ad revenues are expected to rise 53.1% to $449.1 million in
2012, as marketers expand their presence in social games.
Branded integrations and video ads will increase, while lead
generation offers will remain an integral (if controversial) part
of the revenue mix. The social game ad market will reach
$641 million worldwide in 2013.
eMarketer Definitions
Social network sites: Sites where the primary activities
involve creating a profile and interacting with a network
of contacts by sharing status updates, comments,
photos or other content.
Social network ad revenues: Figures include paid
advertising appearing within social network sites, social
network games and social network applications. Figures
do not include spending by marketers that goes toward
developing or maintaining a social network presence
(e.g., a Facebook brand page or Twitter account).
For the list of industry experts interviewed for this
report, see the eMarketer Interviews section.

US social network ad revenues are on pace to reach $2.74 billion
in 2011 and $3.9 billion in 2012, according to eMarketer’s
latest forecast. In 2013, US advertisers are expected to spend
$4.81 billion on social network advertising, up 23.4% over 2012.
Comparative estimates vary widely because forecasters
have differing definitions of what constitutes social network
advertising. Several use a broader term, social media
advertising, in their forecasts.
Myspace
Effective with this report, eMarketer no longer includes
Myspace in its social network ad revenue forecast. Sold by
News Corp. to Specific Media in July 2011, the site is being
recast as an online music discovery destination. Although it
will continue to have social networking features, it no longer
fits with eMarketer’s definition of a social network site.
At the high end of industry estimates, BIA/Kelsey in May 2011
forecast $5.9 billion in US ad spending for social media in 2013. It
defines social media advertising as “money spent on advertising
formats across social networks,” adding that “[c]urrently, the
predominant ad format is display, though there are some
non-display ad formats (e.g.,Twitter’s ‘promoted’ products).”
On the low end, ZenithOptimedia estimated that $1.76 billion
would be spent on social media advertising in 2013. The
company’s figures are lower than others because they do not
count ad formats such as display or search when they appear
within social media sites. eMarketer includes those formats
when they appear within social networks.
millions
Comparative Estimates: US Social Media Marketing
Spending, 2010-2015
Spending type
BIA/Kelsey*, May 2011
Social media ad
Barclays Capital, May 2011
Social network ad
eMarketer**, Sep 2011
Social network ad
Forrester Research, Aug 2011 Social media
marketing
ZenithOptimedia, July 2011
2010
$2,100
$1,990
$2,000
-
$740
2011
$3,400
$2,890
$2,740
$1,590
$980
2012
$4,700
$3,950
$3,900
$2,120
$1,320
2013
$5,900
$5,220
$4,810
$2,760
$1,760
2014
$7,900
$6,470
-
$3,450
-
2015
$8,300
$7,640
-
$4,220
- Social media ad
Note: *excludes social commerce, gaming, marketing, virtual goods and
rewards; **includes paid advertising appearing within social network sites,
social network games and social network applications; excludes spending
by marketers that goes toward developing or maintaining a social network
presence
Source: eMarketer, Sep 2011; various, as noted, 2011
132887
Forrester’s figures include not only paid advertising in social
media but also fees paid to external agencies and the cost of
technology to support social media efforts.Even with the inclusion
of those extras,the figures are lower than most other forecasters’
calculations.That is because Forrester does not include ad formats
such as display or search in its social media spending estimates.
In essence, Forrester’s figures cover external spending that
goes toward marketing and advertising that is innately “social,”
such as Facebook brand pages, Facebook’s Sponsored Stories
ad units or Twitter’s Promoted Products ads.
US Social Network Ad Revenues
US Social Network Ad Revenues, 2009-2013
2009
$1.44
19.3%
2010
$2.00
38.7%
2011
$2.74
37.3%
2012
$3.90
42.2%
2013
$4.81
23.4%
presence
132426
Highlights
■■ US social network ad revenues will rise 42.2% to
reach $3.9 billion in 2012.
■■ 2013 revenues will rise at a slower, 23.4% rate, to
$4.81 billion.

Marketing Spending vs. Advertising Spending
Marketing via social networks has become a requirement for
nearly every business. Marketers recognize the importance
of having a presence in destinations where consumers are
spending more and more time. eMarketer forecasts that 80%
of US companies with 100 or more employees will use social
media tools for marketing this year.
As more companies build out their marketing presence in social
networks, they are also increasing their focus on spending ad
dollars there.According to a 2011 study by Brandon Hall Group
and Covario, 90% of marketing executives who had used social
media marketing for at least one year believed that paid social
media sites would play some role in their marketing in the
coming year. Of those, 47% said paid social media would have a
“critical” or “major” role, and 43% cited a “minor” role.
% of respondents
Role* of Paid Social Media Sites in Their Marketing
Strategy According to US Marketing Executives,
by Length of Social Media Marketing Use, 2011
Greater than one year
17% 30% 43% 10%
Less than one year
6% 12% 44% 38%
Critical role Major role Minor role No role
Note: marketing executives surveyed currently incorporate social media
marketing into their overall search marketing strategy; *in the next year
Source: Brandon Hall Group and Covario, "How Does Integration of Social
Media Marketing (SMM) Enhance a Company's Online Marketing Strategy?"
May 19, 2011
128927
Those who were newer to social media marketing were
less convinced; only 62% thought paid social media would
contribute to their marketing.
Meanwhile, the percentage of ad agencies allocating client ad
budgets to social media reached 68% in Q2 2011, according to
STRATA, the media buying/selling software company owned
by Comcast. That was the highest point in four quarters.
% of respondents
US Ad Agencies that Allocate Ad Spending to Social
Media*, Q3 2010-Q3 2011
Q3 2010
65.1%
Q4 2010
56.1%
Q1 2011
52.9%
Q2 2011
68.0%
57.0%
Note: *Facebook, LinkedIn, etc.
Source: STRATA quarterly survey results, 2010 & 2011
Q3 2011
128951
The spending trend is not consistently upward, however.
STRATA’s figures have fluctuated over the past several quarters,
and in Q3 2011 the response rate went down to 57%.The
quarterly changes may be due to campaign flighting, indicating
that ad spending in social media may be important but not
necessarily occur in a steady stream throughout the year.
US Social Network Ad Revenues

Social networks will have $8.04 billion in ad revenues
worldwide next year, up 45% from 2011. By 2013, revenues will
approach $10 billion, according to eMarketer estimates.
With all the focus on the US market, it is easy to forget
that social network advertising is a sizeable business
internationally. In fact, 50.6% of all social network ad revenues
in 2011 will come from non-US markets. Just two years ago,
the international contribution was 39.6%.
billions and % of total
Social Network Ad Revenues Worldwide, US vs.
Non-US, 2009-2013
2009 2010 2011 2012 2013
US
Revenues
% of worldwide total
Non-US
Revenues
$1.44
60.4%
$0.94
39.6%
$2.00
56.0%
$1.57
44.0%
$2.74
49.4%
$2.80
50.6%
$3.90
48.5%
$4.14
51.5%
$4.81
48.1%
$5.18
51.9%
presence
132431
In 2011, non-US social network ad revenues will rise 78.8%, vs.
37.3% growth in the US. However, growth rates will become
more similar in 2012 and 2013 as international markets catch
up to the US.
presence
% change
Social Network Ad Revenue Growth Worldwide,
US vs. Non-US, 2009-2013
2009
19.3%
21.1%
20.0%
2012
47.8%
42.2%
45.0%
2011
78.8%
37.3%
55.6%
2010
66.3%
38.7%
49.6%
2013
23.4%
25.1%
24.2%
US
Non-US
Worldwide
50%
30%
70%
90%
132435
Worldwide Social Network Ad Revenues
2009
2010
$3.56
2011
$5.54
2012
$8.04
2013
$9.99
presence
49.6%
55.6%
45.0%
24.2%
20.0%
$2.38
132429
Highlights
■■ Ad revenues will reach $8.04 billion in 2012 and rise
24.2% to $9.99 billion in 2013.
■■ The US will account for just under half of worldwide
social network ad revenues in 2011.
■■ Contributors to growth include Facebook’s rising
non-US ad revenue and the increasingly international
social network audience.

Three factors are driving increases in social network ad
revenues outside the US:
■■ Facebook’s international presence. With more than 75%
of its active user base coming from outside the US, Facebook
is attractive to international advertisers. eMarketer forecasts
that in 2012, Facebook will get half of its ad revenue, or
$2.98 billion of the $5.78 billion total, internationally, up from
24.8% in 2009. (For more on Facebook revenues, see the
“Facebook” section later in this report.)
■■ Strength of local social networks. Although Facebook and
Twitter garner the lion’s share of attention in the US, there are
many ad-supported social networks in other countries, such as
mixi in Japan, Renren in China and VKontakte in Russia.While
none of these individually has anywhere near Facebook’s ad
revenue, social networks based outside of the US will have a
combined total of more than $700 million in ad revenues in
2011, eMarketer estimates.
■■ The increasingly international social network
audience. According to comScore Media Metrix, just 18.1%
of social network visitors in June 2011 hailed from North
America, while 32.5% were in Asia-Pacific and 30.1% came
from Europe. And when measured by time spent, Europeans
dominated with a 38.1% share of minutes on social network
sites. At these usage levels, social network users outside the
US are a ripe target audience.
Share of minutesShare of visitors
% of total
Share of Social Network Visitors and Minutes Spent
Worldwide, by Region, June 2011
Note: ages 15+; home and work locations; accessing the internet via PC or
laptop
Source: comScore Media Metrix, "The Rise of Social Networking in Latin
America," Sep 20, 2011
Asia-Pacific
32.5%
Europe
30.1%
Middle East & Africa
9.1%
Latin
America
10.2%
North
America
18.1%
Asia-
Pacific
16.5%
Europe
38.1%
Middle East & Africa
11.2%Latin
America
12.8%
North
America
21.4%
132703
Facebook looks unlikely to cede its ad revenue dominance
among social networks. About $7 out of every $10 flowing
to social networks worldwide will go to Facebook in 2011,
eMarketer estimates. The company’s share is expected to
remain steady through 2012 but will decline slightly in 2013 as
Twitter makes incremental gains.
% of total
Social Network Ad Revenue Share Worldwide,
by Venue, 2009-2013
2009 2010 2011 2012 2013
Facebook 31% 52% 69% 72% 70%
Social games 5% 5% 5% 6% 6%
LinkedIn 2% 2% 3% 2% 2%
Twitter * 1% 3% 3% 4%
Myspace 20% 7% 1% ** **
Other*** 42% 32% 20% 17% 17%
Note: numbers may not add up to 100% due to rounding; *Twitter didn't
have ad revenue in 2009; **effective in 2012, Myspace will no longer be
included in eMarketer's forecast; ***includes international social networks,
portal-based social networks and social apps
132444
The following sections provide a snapshot of trends in key
countries in Europe, Asia-Pacific and Latin America.
UK
UK advertisers have been somewhat slower than those in the
US to gravitate toward social networks. According to eCircle,
50% of UK marketers used social media marketing as of
January 2011. By contrast, eMarketer estimates that 80% of US
marketers will use social media marketing this year.
The difference may be because UK consumers are somewhat
less likely than US consumers to visit social networks. Forty-six
percent of UK consumers used social networks in Q1 2011,
according to the Office of Communications–UK (Ofcom), while
Pew Internet & American Life Project found in an August
2011 study that 65% of US adults used social networks. The
pace of growth is leveling off in the UK; penetration grew 10
percentage points between 2008 and 2009 and again between
2009 and 2010, but only 6 points between 2010 and 2011.
% of respondents in each group
UK Consumers Who Access Social Networks, by Age
and Gender, Q1 2008-Q1 2011
Gender
Female
Male
Age
16-24
25-34
35-54
55-64
65-74
75+
Total
Q1 2008
(n=5,812)
20%
19%
38%
31%
21%
9%
3%
1%
20%
Q1 2009
(n=6,090)
31%
28%
50%
46%
35%
13%
3%
1%
30%
Q1 2010
(n=9,013)
42%
39%
61%
61%
48%
20%
7%
3%
40%
Q1 2011
(n=3,474)
47%
45%
69%
64%
54%
28%
12%
5%
46%
Source: Office of Communications (Ofcom) - UK, "The Communications
Market 2011," Aug 4, 2011
130972

While Facebook is the social network leader in the UK, its
dominance has diminished somewhat since 2010, according
to Hitwise. It received 50.14% of all social network visits in July
2011, down from 54.59% in July 2010. Meanwhile other sites
posted gains in market share, including YouTube (which by
eMarketer’s definition is not a social network) and Twitter.
Top 10* Social Networks Among UK Internet Users,
Ranked by Market Share of Visits, July 2010 & July 2011
July 2011
1. Facebook 50.14%
2. YouTube 22.54%
3. Twitter 3.49%
4. Yahoo! Answers 2.47%
5. Gumtree 1.32%
6. Tumblr 0.84%
7. LinkedIn 0.83%
8. Moshi Monsters 0.48%
9. MoneySavingExpert 0.46%
10. Myspace
July 2010
54.59%
17.10%
2.22%
2.26%
1.10%
0.23%
0.38%
0.25%
0.46%
1.20% 0.44%
Note: *2011 rankings
Source: Hitwise as cited by ClickZ, Aug 9, 2011
132013
China
The social networking market attracting the most attention in
Asia-Pacific is China. Closed off to most US social networks,
the Chinese internet audience has embraced native social
networks such as Renren and Tencent’s Qzone and Pengyou.
According to GlobalWebIndex, China had 155 million active social
network users in June 2011, more than four times as many as in
India, the second-largest Asia-Pacific social network market.
millions
Active Social Network Users in Select Countries in
Asia-Paciﬁc, June 2011
China
155.3
India
35.1
Indonesia
18.9
Philippines
14.4
Japan
13.7
Malaysia
11.5
South Korea
10.9
Australia
7.1
Hong Kong
2.6
Singapore
2.0
Source: GlobalWebIndex as cited in company blog, June 14, 2011
130011
The Data Center of China Internet (DCCI) forecast that $256 million
would be spent on social network advertising in 2011,or about 5%
of total online ad spending in the country.
billions of Chinese yuan renminbi
Online Ad Spending in China, by Category, 2007-2015
Search Portals Ad
networks
Video Social
networks
2007 2.73 3.12 1.06 0.21 0.41
2008 5.08 4.77 1.81 0.43 0.66
2009 7.01 4.83 2.25 0.88 0.78
2010 10.83 6.02 2.88 1.75 1.06
2011 18.05 7.70 3.64 3.26 1.73
2012 27.52 9.51 4.62 5.51 2.62
2013 40.51 11.55 5.94 8.80 4.16
2014 59.35 14.11 7.67 13.70 7.16
2015 85.52 17.07 10.08 20.58 13.50
Source: Data Center of China Internet (DCCI), "Internet Insight: First Half
2011," July 13, 2011
131392
Renren has emerged as one of the leaders in social network
ad revenue in China. The company, which went public in 2011,
had $32 million in ad revenues in 2010 and $25 million in the
first half of 2011.
Another market leader, Tencent, does not break out ad
revenues for its social networks, but it had $207 million in
online advertising revenue across all of its properties in 2010,
a gain of 42.6%. Online ad revenue in 2011’s first half grew
nearly 32%, to $122.6 million.

The major change in China’s online space since early 2010
has been the rise of Twitter-style “weibo” microblogging sites,
including Tencent’s Tencent Weibo and Sina’s market-defining
Weibo.com.According to the China Internet Network Information
Center (CNNIC), there was a 200% increase in the number of
weibo users in the first half of 2011, reaching 40% of China’s
online population.
Microblogging in China: The Story of Weibo
Microblogging is growing rapidly in China, challenging
the Chinese social networks for consumers’ online
time and reaching user numbers that dwarf Twitter’s
worldwide user base.
In Q2 2011, Analysys International reported that 174 million
people used weibo sites for microblogging at least once per
month in China, a 24.3% increase from Q1. In comparison,
in September 2011, Twitter reported it had 100 million total
worldwide accounts that were active on a monthly basis.
millions and % change
Microblog Site Users* in China, Q1 2010-Q2 2011
Q1 2010
20.7
Q2 2010
56.7
(174.2%)
Q3 2010
80.0
(41.2%)
Q4 2010
101.3
(26.7%)
Q1 2011
140.0
(38.2%)
Q2 2011
174.0
(24.3%)
Note: *individuals, organizations or enterprises that use microblogs at
least once per month
Source: Analysys International as cited in press release, Aug 4, 2011
130840
Chinese microblogs often combine several elements of
social networking, including instant messaging, daily deals,
video- and photo-sharing, and groups, so they are more
robust than Twitter and offer greater competition for social
networks such as Renren. Twitter has been blocked in
China since 2009, following the Xinjiang riots and the 20th
anniversary of the Tiananmen Square protests.
In a March 2011 study from iResearch and China
International Capital Corporation, two weibo sites
dominated: Sina Weibo had a 56.5% market share of
active users, and Tencent Weibo came in second with
21.5%. Sina is the older service, launched in 2009 by Sina
Corp., one of China’s top portal operators. The service
had more than 200 million registered users in August
2011, up from 140 million in May. Tencent, known for its
instant messenger service QQ, had 233 million weibo
users as of August 2011.
Sohu and NetEase also offer weibo sites, though their
user numbers are much smaller. Sohu, which has a
strong gaming base, and Netease, with a large mobile
presence, in March 2011 had 6.4% and 2.5% of the
market, respectively, according to iResearch.
The pressure to succeed has already claimed one
entrant: In August 2011, search company Baidu shut
down its Baidu Shuoba, or Baidu Talk, service. Twitter,
for its part, has not announced plans to re-enter China,
although it became available in both simplified and
traditional Chinese in September 2011.
Which weibo will be bigger? Sina has the buzz, while
Tencent has the backbone. Tencent has more experience
in social networking, but Sina has drawn attention for
the role its weibo has played in current events, such as a
July 2011 train crash.
When it comes to advertising, Tencent Weibo is further
ahead. It has a more robust platform that is connected
throughout Tencent’s social network offerings, and there are
ads on the homepage of its weibo. For its part, Sina Weibo
plans to introduce advertising in the first half of 2012.
Several international brands already are using weibo
accounts to interact with users, similar to how businesses
use Twitter for customer service and other types of
marketing. Nike, Starbucks and the National Basketball
Association all have weibo accounts. However, marketers
should not plan to port their Twitter advertising strategy
directly to China’s weibo sites. Because the services are
more interactive than Twitter, brands can do more than
share 140 characters of text and links.
The success of China’s weibo sites will depend on how
quickly they can mobilize their current users and gain
new ones, and how well their ad products will meet the
needs of marketers. Given the rapid growth of the weibo
market, expect many changes in the coming year.

Latin America
Internet users in Latin America are among the heaviest users
of social networking. According to comScore, five countries—
Argentina, Chile, Colombia, Venezuela and Mexico—ranked in
the top 10 countries worldwide based on the average number
of hours spent on social networks per visitor in June 2011.
Internet users in Argentina spent an average of 10 hours on
social networks, while people in the other four countries spent
between 7.1 and 8.7 hours on such sites.
As in most parts of the world, Facebook is the most popular
social network in Latin America. However, in this region
Windows Live Profile and orkut also have strong audiences,
each about one-third the size of Facebook’s.
millions
Top 10 Social Media Sites Among Internet Users in
Latin America, Ranked by Unique Visitors, June 2011
1. Facebook
91.1
2. Windows Live Proﬁle
35.6
3. orkut
34.4
4. Twitter
24.4
5. Badoo
8.8
6. SlideShare
8.2
7. Sonico
7.7
8. LinkedIn
7.3
9. Myspace
6.6
10. Fotolog
5.6
Note: ages 15+; home and work locations; accessing the internet via PC or
laptop
Source: comScore Media Metrix, "The Rise of Social Networking in Latin
America," Sep 20, 2011
132705
Twitter is rising in usage. As one point of comparison, 14% of
internet users in the US visited Twitter in May 2011, but the
penetration rate was much higher in Brazil (26.7%), Venezuela
(23.7%) and Argentina (17.2%), according to comScore.
However, when it comes to advertising within social networks,
the Latin American market is small. In Mexico,Venezuela, Peru,
Chile, Colombia and Argentina combined, social media ad
spending will reach just $37 million in 2011, according to Starcom
MediaVest Group. But significant growth is expected in the next
two years at which time total social media ad spending in the six
countries will reach $128 million, according to Starcom.

Brazil Moves Beyond orkut
Google’s orkut social network has been popular in Brazil
since it launched in 2004. But the site’s dominance is
being challenged as Facebook and Twitter make inroads
in the country.
An August 2011 study from IBOPE Nielsen Online put
Facebook out in front, with 30.9 million users, or 68.2% of
internet users. Meanwhile, orkut had 29 million, or 64% of
internet users, and Twitter came in with 14.2 million, for a
penetration rate of 31.3%.
millions and % of internet users
Social Network Users and Penetration in Brazil, by
Site, Aug 2011
Facebook 30.9 (68.2%)
orkut 29.0 (64.0%)
Twitter 14.2 (31.3%)
Note: home and work locations; according to IBOPE Nielsen Online, social
network users in Brazil connected to these sites for an average of 7 hours
and 14 minutes during August 2011
Source: IBOPE Nielsen Online as cited in press release, Sep 9, 2011
132498
However, when it comes to how often web users in
Brazil use these social sites, Twitter has momentum.
In early 2011, market intelligence company E.Life
surveyed internet users in Brazil and asked which three
social network services they used the most. Twitter was
mentioned by 74% of users, while Facebook was noted
by 63%. Coming in fourth, below MSN, was orkut, with
just 34.1% choosing it as one of their most-used sites.
% of respondents
Top 10 Social Networks* Used by Social Network
Users in Brazil, Jan 2011
Twitter
74.0%
Facebook
63.0%
MSN
48.4%
orkut
34.1%
YouTube
12.0%
Blogspot
9.0%
Google T
8.4%
Blogger
7.7%
Skype
6.5%
WordPress
5.6%
Note: n=945; *respondents selected three most-used services
Source: E.Life, "Usage and Behavioral Habits of Brazilian Internet Users in
Social Media," March 1, 2011
131867
It’s too early to declare a new social networking
leader in Brazil, however. Facebook’s users continue
to grow, but Twitter is improving its Brazilian offering,
introducing Brazilian Portuguese as an official language
in June 2011. It is also worth noting that Google, orkut’s
owner, is currently focused on its other social offering,
Google+, which has also become popular in Brazil.

Social networks will steadily increase their share of total online
ad spending in the US and around the world.
In 2011, 8.8% of all US online ad spending will go to social
networks, increasing to 10.6% in 2012 and 11.7% in 2013. On
a worldwide basis, 6.9% of online ad spending will go to social
network sites in 2011, or $5.54 billion out of the total $80.2 billion.
By 2013, social network ad revenues will reach 9.4% of the
worldwide total for online ad spending.
billions and % of total online ad spending worldwide
2009 2010 2011 2012 2013
Social network
ad revenues
Total online ad
spending worldwide
Social network
% of total
$2.38
$55.20
4.3%
$3.56
$68.40
5.2%
$5.54
$80.20
6.9%
$8.04
$94.20
8.5%
$9.99
$106.10
9.4%
presence
132430
There is some evidence that social networks are contributing
to growth in overall online ad spending and are taking budget
from traditional media.
MAGNAGLOBAL in June 2011 increased its 2011 total US
online ad spending forecast to $30.1 billion, citing “strong
momentum in online video and social media as large
national advertisers begin to invest more in building brand
awareness online.”
Investment bank Barclays, in a July 2011 research note,
stated: “Increasingly, we believe marketers are allocating a
larger percentage of their budgets to social networks, which
we believe are by and large incremental to online search
advertising and which we believe are being funded primarily
from traditional media budgets.”
The budget question is one that marketers will likely be
forced to address in 2012 as social media ad spending eats
more noticeably into available funds. While one theory is that
marketers will turn to search budgets to fund social network
advertising, this isn’t the case broadly.
As Kris Narayanan, Samsung’s vice president of digital
marketing, North America, noted in an interview with
eMarketer: “In the past couple of years, [social ad spending
has] been coming from traditional ad budgets. Because the
amounts haven’t been that significant, it hasn’t been that
substantive as to be considered a reduction in traditional ad
media dollars.”
One goal Narayanan has for 2012 is to get smarter about
“optimizing across these media as we recognize what the
linkages are between TV advertising, print advertising and now
social as a part of the digital mix.”
“We’ll be looking more at social’s role in the
entire marketing mix vs. isolating it as an
area of innovation.” —Amanda Richman, president
of digital at MediaVest, in an interview with eMarketer,
August 15, 2011
As the worldwide economy continues to struggle, it is
unclear whether social network ad revenues will be affected.
eMarketer’s viewpoint is that the impact will be felt more
strongly in traditional media than in online media. And within
online media, social networks will be more insulated because
for many marketers the spending is no longer being funded
by experimental dollars, which often get cut first. The channel
is also less vulnerable because social networks, particularly
Facebook, offer a combination of mass audience and the
ability to target ads to discrete segments.
Social Networks in the Advertising Mix
billions and % of total US online ad spending
US Social Network Ad Revenues, 2009-2013
2009 2010 2011 2012 2013
Social network ad revenues $1.44 $2.00 $2.74 $3.90 $4.81
Total US online ad spending $22.70 $26.00 $31.30 $36.80 $41.20
Social network % of total 6.3% 7.7% 8.8% 10.6% 11.7%
presence
132427
Highlights
■■ Social networks will surpass 10% of total online ad
spending in the US in 2012 and reach 11.7% in 2013.
■■ Marketers worldwide will increase social network ad
spending to 8.5% of online ad budgets next year.
■■ Advertisers are shifting budgets from several
places, including search, print and TV, to fund
social spending.

If economic conditions drive cuts in TV spending, Facebook
may help fill the gaps. There has been some talk in the industry
that the company is already targeting TV budgets. While
not explicitly admitting to that, Facebook’s vice president of
global marketing solutions, Carolyn Everson, told eMarketer:
“Everyone that buys in the TV upfront should be demanding
that [their buy] has a social component. Anytime anyone’s
talking about hot TV shows or live events, they’re doing it in a
social environment.”
Q&A: Where are budgets for social media
advertising coming from?
As social media advertising becomes a bigger part of
companies’ marketing plans, brands are making tough
decisions about how to fund these projects. While the funding
sources are still a mix, coming from search, display and even
traditional advertising, some companies are creating new
budget lines just for social media advertising.
Amanda Richman
President, Digital
MediaVest
“Today, it’s still a combination of budgets coming from the display
world and the search world. Social is also starting to get more
branding dollars as marketers understand the environment and
how to connect with consumers in a richer way.We are also
seeing more of a blending approach, where it’s not specific to
a social, mobile, local or video budget, but it’s about how all of
these can work together to develop an experience.”
Justin Merickel
Vice President of Marketing and New Product Development
Efficient Frontier
“It’s primarily coming from traditional channels. We haven’t
seen an impact to search or display budgets, at least on the
exchange side of display. There could be a little bleed-over
from traditional display, but we think it’s primarily coming from
traditional media because a lot of these brand advertisers are
hungry for new outlets. They see a lot of new opportunity.”
Micah Nyatsambo
Director of Emerging Technologies
Media Contacts
“We’ve seen independent budgets for social media advertising
grow. Clients started out testing and are now deciding to take
new money that wasn’t from search or display and put it
straight to paid media on Twitter and Facebook.”
Dave Williams
CEO and Co-founder
BLiNQ Media
“At this stage, the budgets are coming from different places.
One of our clients, an entertainment brand, has shifted a lot
of budget away from search into Facebook. We’re also seeing
some of our clients migrate some of their TV buying over to
social. That’s where the biggest opportunity is. These clients
see social as an engagement platform and as an audience
buying platform, which is quite different from the way you look
at a display buy or even a search buy.”
Social Networks in the Advertising Mix

Facebook is cementing its dominance of the social network ad
market. eMarketer expects Facebook to have $5.78 billion in
worldwide ad revenues in 2012 and $7 billion in 2013.
Facebook’s 2011 ad revenue will come in at $3.8 billion, about
6% less than the $4.05 billion eMarketer had forecast earlier
this year. The change in the forecast should not be taken as a
sign that Facebook’s business is losing momentum, however.
In 2012, Facebook will slightly surpass our earlier projection of
$5.74 billion in ad revenue.
Facebook’s revenue streams will continue to diversify, with ads
representing a decreasing proportion of the total while other
revenue sources, such as Facebook Credits, grow.
eMarketer forecasts that Facebook will have $4.27 billion in total
revenue in 2011, with $3.8 billion from ads and $470 million from
Credits and other sources.
Ads, which represented an estimated 95% of Facebook’s revenue
in 2009, are expected to fall to 89% of revenue this year.
millions and % of total
Facebook Revenues Worldwide, by Source, 2009-2011
2009 2010 2011
Advertising* $738 $1,860 $3,800
Facebook Credits and other revenue $39 $140 $470
Total $777 $2,000 $4,270
Advertising % of total 95% 93% 89%
Note: *paid advertising only; excludes spending by marketers that goes
toward developing or maintaining a Facebook presence
132436
Facebook has grown rapidly as an online advertising venue
in 2011. For digital agency Razorfish, it has become one of
the top 10 sites in terms of spending, Deidra Bodkin, vice
president of media, told eMarketer.
In 2012, 7.9% of all online ad spending in the US will go to
Facebook, eMarketer estimates, rising to 8.2% in 2013.
Facebook Share of Total US Online Ad Spending,
2009-2013
2009 2010 2011 2012 2013
Facebook US ad* revenues $0.56 $1.21 $2.01 $2.89 $3.36
Total US online ad spending $22.70 $26.00 $31.30 $36.80 $41.20
Facebook % of total 2.4% 4.7% 6.4% 7.9% 8.2%
132439
Facebook
Facebook Ad Revenues Worldwide, 2009-2013
2009
$0.74
2010
$1.86
2011
$3.80
2012
$5.78
2013
$7.00
Facebook ad revenues % change
Note: paid advertising only; excludes spending by marketers that goes
152.0%
104.3%
52.1%
21.1%
132438
Highlights
■■ Facebook’s worldwide ad revenues will reach $7
billion in 2013, up from $3.8 billion in 2011.
■■ Total revenue, including Facebook Credits, will reach
$4.27 billion in 2011.
■■ Ads are falling as a percentage of revenue and will
make up 89% of Facebook’s total revenue in 2011.

In dollars, that will make Facebook the third-biggest online ad
seller in the US for the second year in a row. Google will remain
far ahead, with $16.53 billion in net US online ad revenues in
2012, but Facebook is gaining ground on second-place Yahoo!
billions
Net US Online Ad Revenues at Top 5 Ad-Selling
Companies, 2009-2012
2009 2010 2011 2012
Google $7.90 $10.03 $12.77 $16.53
Yahoo! $3.66 $3.47 $3.46 $3.57
Facebook $0.56 $1.21 $2.01 $2.89
Microsoft $1.18 $1.49 $1.92 $2.66
AOL $0.99 $0.88 $0.85 $0.86
Total top 5 $14.28 $17.07 $21.01 $26.51
Total internet $22.66 $26.04 $31.30 $36.80
Note: net ad revenues after companies pay traffic acquisition costs (TAC) to
partner sites; Facebook figures are eMarketer estimates from Sep 2011
Source: company reports, April-May 2011; eMarketer, June & Sep 2011
132516
In the display ad market, Facebook’s control is stronger. In
2011 it will surpass Yahoo! as the top display ad seller in the
US, while Google will come in third, eMarketer predicts.
billions
Net US Online Display Ad Revenues at Top 5
Ad-Selling Companies, 2009-2012
2009 2010 2011 2012
Facebook $0.56 $1.21 $2.01 $2.89
Yahoo! $1.26 $1.43 $1.62 $1.85
Google $0.36 $0.86 $1.15 $1.82
Microsoft $0.37 $0.51 $0.60 $0.71
AOL $0.51 $0.47 $0.52 $0.58
Total top 5 $3.05 $4.47 $5.91 $7.86
Total online display $7.97 $9.91 $12.33 $14.82
Note: includes banner ads, rich media, sponsorships and video; net ad
revenues after companies pay traffic acquisition costs (TAC) to partner
sites; Facebook figures are eMarketer estimates from Sep 2011
Source: company reports, April-May 2011; eMarketer, June & Sep 2011
132520
In July 2011, Facebook controlled 30.4% of US display ad
impressions, according to comScore, well ahead of Yahoo!
sites, which had 10.7% of the market.
William Blair & Co., in its May 2011 report “The Future in Digital
Media,” forecast that Facebook would receive 38% of all US
display ad impressions in 2011, rising to 47% by 2015. In raw
numbers, that would amount to more than 2 trillion display ad
impressions in 2011, increasing to 3.28 trillion in 2015.
US Facebook Display Ad Metrics, 2011-2015
Facebook display ads (trillions)
Total US display ads (trillions)
Facebook % of total display ads
2011
2.02
5.3
38%
2012
2.34
5.7
41%
2013
2.67
6.1
44%
2014
2.98
6.5
46%
2015
3.28
7.0
47%
Source: William Blair & Company, "The Future in Digital Media," May 16, 2011
131833
Facebook is also showing increasing strength in the worldwide
online ad market. In 2013, eMarketer expects it to receive
6.6% of all online ad spending.
Facebook Share of Total Online Ad Spending
Worldwide, 2009-2013
Facebook ad*
revenues worldwide
Total online ad
spending worldwide
Facebook % of total
2009
$0.74
$55.20
1.3%
2010
$1.86
$68.40
2.7%
2011
$3.80
$80.20
4.7%
2012
$5.78
$94.20
6.1%
2013
$7.00
$106.10
6.6%
132440
The strong international showing comes as non-US markets
account for a growing proportion of ad revenue. In 2013, more
than half of Facebook’s $7 billion in ad revenue will come from
non-US markets.
Facebook Ad Revenues Worldwide, US vs. Non-US,
2009-2013
2009 2010 2011 2012 2013
US $0.56 $1.21 $2.01 $2.89 $3.36
% of worldwide total 75.2% 65.0% 53.0% 50.0% 48.0%
Non-US $0.18 $0.65 $1.79 $2.89 $3.64
% of worldwide total 24.8% 35.0% 47.0% 50.0% 52.0%
Worldwide $0.74 $1.86 $3.80 $5.78 $7.00
132437
Facebook

Challenges
Although Facebook’s ad revenue is growing rapidly, there are
at least two areas where the company still needs to prove
itself to marketers.
[Editor’s Note: These were contributing factors to the change
in eMarketer’s 2011 forecast for the company as well.]
Facebook needs to show that its ad products
consistently deliver results. Despite years of wooing
marketers, Facebook has still failed to convince many that its
ads are effective at driving clicks and other actions.
One of the challenges the company has yet to overcome is
its exceedingly low average clickthrough rate. According to
agency SocialCode’s 2011 analysis of its clients’ Facebook
ads, the average clickthrough rate for women was 0.029%,
compared to 0.026% for men. Among both genders, the click
rate was higher for older adults than for younger ones.
Clickthrough and "Like" Rate* of Facebook Display Ads
Among US Internet Users, by Age and Gender, 2011
Clickthrough rate "Like" rate*
18-29
30-39
40-49
50+
Total
Male
0.025%
0.024%
0.026%
0.030%
0.026%
Female
0.026%
0.028%
0.031%
0.034%
0.029%
Male
41%
38%
38%
36%
39%
Female
39%
38%
40%
36%
38%
Note: *based on people who had clicked on the ad
Source: SocialCode, Aug 30, 2011
131993
The ad industry acknowledges this.As Marc Ruxin,chief innovation
officer of Universal McCann,told eMarketer inAugust 2011:
Facebook ads are“performing at least as well as traditional display
advertising,which performed horribly in the first place.But no one
would describe display advertising as a super-effective mousetrap,
yet we still do it on a global basis”anyway.
Facebook must either work to improve its clickthrough rate
or show that its advertising is effective even without a click
or other action. Offering more information on the value of a
Facebook impression is one way to do this.
Facebook’s rapid growth as a marketing vehicle is a
double-edged sword. Many major marketers have developed
extensive presences on the site. Procter & Gamble, for example,
has added shopping features to several of its brand pages and
made a reported multimillion-dollar ad buy on the site in 2011.
Media agency MediaVest, which counts P&G among its clients,
has helped an increasing number of clients in 2011 develop
“high-volume, deeper, large-scale partnerships with Facebook”
that have resulted in large budget allocations “supporting not
just advertising opportunities, but opportunities to look and
grow the space together as well,” said MediaVest’s Amanda
Richman, in an interview with eMarketer.
Wine and spirits producer Diageo has also committed $10 million
to advertising on Facebook and is among several companies that
joined Facebook’s client council, an advisory board composed of
top executives at major marketers and agencies.
However, other marketers, having amassed a large quantity of
“likes,” feel that they can continue to market to these people
directly through their pages rather than by buying advertising
on Facebook. This may especially be the case for companies
that market to Facebook’s younger users, because these
users tend to be more likely to interact with brand pages.
According to a survey by Barkley that compared millennials to
other adults, 23.5% of millennials who had “liked” a brand on
Facebook interacted with content from a brand’s Facebook page
at least once daily, vs. 17% of older adults who did the same.
% of total
Frequency of Interacting with Content from a Brand
They "Like" on Facebook According to US Millennial
Consumers vs. Consumers Ages 35-74, June 2011
Multiple times per day (i.e., 7+ times per week)
11.3%
7.9%
Once a day (i.e., approximately 7 times per week)
12.2%
9.1%
3-6 times a week
12.8%
9.4%
1-2 times a week
13.9%
12.9%
2-3 times a month
11.6%
10.0%
Once a month
9.3%
9.8%
Less than once a month
15.2%
15.3%
Does not apply
13.8%
25.6%
16-34 35-74
Note: n=3,082 millennials ages 16-34; n=660 ages 35-74; numbers may not
add up to 100% due to rounding
Source: Barkley, "American Millennials: Deciphering the Enigma
Generation" in partnership with Service Management Group and The
Boston Consulting Group, Aug 18, 2011
131678
Facebook

Adding fuel to this perspective is the fact that Facebook doesn’t
offer the splashy rich media ad units that attract advertisers
to other types of sites. Facebook must continue to convince
marketers that buying advertising in addition to bulking up a
brand presence leads to better overall results, even if the ads
aren’t as flashy.The message is akin to using the combination of
search engine optimization to rank high in organic search results
along with complementary paid search ads.
Trends for 2012
Making advertising more social. With the pending
launch of redesigned profile pages and other new features
announced at its f8 developer conference in September 2011,
Facebook has made it clear that it plans to create new ways
for companies to market to users based on the actions they
take on Facebook.
The company hopes to build on the success of Sponsored
Stories, an ad format Facebook launched in January 2011 that
lets an advertiser highlight a user’s action, such as a comment
or a “like,” and show that action to a user’s friends in an ad
unit on the right side of the page. These have already proven
successful, with higher clickthrough rates than other ad types.
“In general, we’ll see that [Sponsored Stories
ads] typically perform at 200% to 300%
improvement over standard Facebook-brand
ad units, and that’s specific not only to
clickthrough rate but also to the conversion
rates.” —Dave Williams, CEO of BLiNQ Media, in an
interview with eMarketer,August 16, 2011
In an example cited at f8, someone listening to the Dave
Matthews Band on Spotify, one of Facebook’s partners, would
be tagged as a fan and could then receive ads targeted to fans
of the band. Or that person’s listening behavior could be used
as an ad itself, encouraging the user’s friends to also listen to
and, ideally, buy music.
Moves toward social advertising may encourage marketers
to spend more ad dollars on Facebook. Said Alan Gellman,
senior vice president of digital marketing at Wells Fargo, in an
interview with eMarketer:“I would argue that the premium [ad]
placement [on Facebook] isn’t social at all. But that’s not how
the industry is talking about it.You read articles and people say
if you’re spending money on Facebook, it’s paid social. But I
actually think of it as just another form of digital marketing, and
Facebook is a really important publisher.”
Targeting TV. As Facebook continues on its mission to add
social context to everything people do, it will become both
a partner and a threat to TV. The company is focusing on
convincing media companies to share their content through
Facebook, but at the same time, it is teaming with Nielsen
to offer metrics that make Facebook advertising more
comparable with other advertising, including TV.
“Over time, marketers will start to see Facebook not just as
a social network, but an aggregation of audiences that are
having conversations about brands, about television shows,
pop culture, areas they want to connect with,” MediaVest’s
Richman told eMarketer. “When that pivot starts to happen,
then we may see an opportunity for more television dollars to
flow” into Facebook.
Some TV budgets are already starting to move. Said BLiNQ’s
Williams: “We’re seeing some of our clients migrate some
of their TV buying over. I would say we’re in the very early
stages of that. I think that’s where the biggest opportunity is,
and Facebook is setting itself up to be very complementary
to television in terms of the metrics it’s offering: reach and
frequency and things like that, vs. traditional performance
metrics through display.”
Greater focus on metrics. Proving the effectiveness of
Facebook’s advertising is also a necessity for 2012 because
enabling advertisers to compare the effectiveness of Facebook
and other media, such as TV, may convince them to shift budgets.
This means Facebook will focus on answering questions such
as how it can complement other media, how marketers can
reach their audience on Facebook, and what parts of their
campaign can be run on Facebook vs. on other media.
In addition, Facebook will work toward proving return on
investment from its advertising, beyond measuring clicks.
Focusing on the offline sales impact from running ads on
Facebook will enable the company to better show that it
moves the needle.
“Our ability to track and measure needs
to improve and that’s really where the
advances are happening. [Facebook] built
basic capabilities that are getting more and
more enhanced to be able to measure and
target and segment. That’s going to make
ad performance a lot better.”
—Kris Narayanan, vice president of digital marketing at
Samsung, in an interview with eMarketer, August 24, 2011
Facebook

Twitter is gaining momentum. It is expected to earn $259.9 million
in worldwide ad revenue next year, rising to nearly $400 million
by 2013.
Advertising revenue will come almost exclusively from the US
in 2011, with just 4% from international markets. As Twitter
rolls out ad sales offices worldwide, the percentage of ad
revenue from international markets will reach 10% in 2012 and
12% in 2013, eMarketer estimates.
Twitter Ad Revenues Worldwide, US vs. Non-US,
2010-2013
2010 2011 2012 2013
US
Non-US
Worldwide
98%
2%
$44.1
$0.9
$45.0
96%
4%
$133.9
$5.6
$139.5
90%
10%
$233.9
$26.0
$259.9
88%
12%
$351.6
$47.9
$399.5
toward developing or maintaining a Twitter presence
132443
This forecast features a slightly lower 2011 ad revenue estimate
than eMarketer’s previous estimate from January 2011, which
pegged Twitter’s 2011 ad revenues at $150 million.This decrease
is the result of Twitter’s slower-than-expected rollout of its non-US
sales offices as well as its delay in launching a platform enabling
advertisers to buy ads on a self-serve basis.
Twitter’s suite of ad products, which includes Promoted Trends,
Promoted Accounts and Promoted Tweets, has seen success
in the US.The addition of new sales efforts in the UK and other
markets, as well as the self-serve platform, will drive revenue
up in 2012 and 2013. In addition, a new ad capability enabling
marketers to place Promoted Tweets in users’ timelines will also
provide targeting opportunities for advertisers.
Twitter is very much focused on advertising as its main
revenue driver, though the site has a licensing partnership with
Microsoft’s Bing. (A deal with Google expired in 2011 and has
not been renewed.) It also gains some revenue from providing
access to its tweets for research and curation purposes.
Twitter
Twitter Ad Revenues Worldwide, 2010-2013
2010
$45.0
2011
$139.5
2012
$259.9
2013
$399.5
toward developing or maintaining a Twitter presence
210.0%
86.3%
53.7%
132442
Highlights
■■ Ad revenue will rise to $259.9 million in 2012, up
86.3% from $139.5 million this year.
■■ 2013 ad revenue will approach $400 million.
■■ 2012–2013 growth is predicated on the release
of Twitter’s self-serve platform, as well as its
international sales rollout.

Although Facebook is seeing the biggest spending boost,
marketers have reported that they expect to increase ad
spending on Twitter. A February 2011 survey by The Creative
Group and American Advertising Federation found that more
than three-quarters of US advertisers and marketers planned
to increase their ad spending on Twitter “significantly” (26%) or
“somewhat” (51%) in the next three to five years.
% of respondents
Change in Ad Spending on Select Social Networks
According to US Advertisers/Marketers, Feb 2011
Facebook
YouTube
Twitter
LinkedIn
foursquare
Flickr
Increase
signiﬁcantly
40%
33%
26%
20%
10%
6%
Increase
somewhat
49%
49%
51%
51%
36%
37%
No change
6%
13%
13%
18%
23%
31%
Decrease
5%
4%
8%
9%
14%
17%
Note: n=500 AAF Ad Club members; in the next 3-5 years; numbers may
not add up to 100% due to rounding
Source: The Creative Group and American Advertising Federation (AAF),
"The Creative Team of the Future," July 12, 2011
130215
Challenges
As Twitter gains more traction as an ad vehicle, it faces
several challenges.
Its ad products are labor-intensive. Twitter’s ads are
unique, requiring more attention and resources from
marketers than other formats. The company encourages
advertisers to tweak hashtags and search parameters
during the course of a campaign to take advantage of user
interaction, and that requires real-time attention.
“A lot of the buys take a tremendous amount of resources in
terms of structuring the posts,” said Josh Martin, senior vice
president and director of client services for ID Media, in an
August 18, 2011 interview with eMarketer. “It’s an ongoing,
evolving process and it does require commitments from the
client side as well as the agency side.”
Users may feel inundated with marketing messages.
Twitter’s plan to slowly roll out Promoted Tweets in users’
timelines is an indicator that it is concerned about overwhelming
users with ads.The delays in the launch of the self-serve platform
likely result from Twitter’s nervousness about opening up its
system to potentially thousands of new advertisers, while still
maintaining control over the user experience.
Online market research firm Lab42 in August 2011 found that
21% of US Twitter users it surveyed saw Promoted Tweets as
detracting from the Twitter experience. However, 27% said
they had retweeted a Promoted Tweet and more than 40%
had either learned about new brands, gotten discounts or
seen Promoted Tweets from relevant brands.
% of respondents
Attitude of US Twitter Users Toward Promoted
Tweets, Aug 2011
I see Promoted Tweets from brands that are relevant to me
48%
I've gotten discounts from Promoted Tweets
42%
I've found out about new brands through Promoted Tweets
41%
I've retweeted a Promoted Tweet
27%
They are annoying and take away from the Twitter experience
21%
I haven't noticed them
8%
I don't know what Promoted Tweets are
7%
Note: n=500; Promoted Tweets are clearly labeled but otherwise ordinary
tweets that are paid for by advertisers in order to reach a wide group of
users or to spark engagement from their existing followers
Source: Lab42 survey as cited in company blog, Aug 20, 2011
131720
Keeping the ad buzz going. STRATA, in its quarterly surveys
of US ad agencies, found that fewer were considering placing
Twitter advertising in 2011 vs. 2010. In Q3 2011, 37% of US ad
agencies reported they would be likely to use Twitter as part of
their clients’ campaigns, down from 57.1% in Q1 2010.
% of respondents
Social Media Sites US Ad Agencies Are Most Likely to
Use in Their Clients' Campaigns, Q1 2010-Q3 2011
2010 2011
Facebook
YouTube
Twitter
LinkedIn
Google+
foursquare
Myspace
Digg
Other
Not using
Q1
87.5%
39.3%
57.1%
17.9%
-
-
5.4%
3.6%
-
12.5%
Q2
84.0%
37.0%
43.2%
23.5%
-
-
4.9%
3.7%
3.7%
14.8%
Q3
87.9%
39.4%
42.4%
18.2%
-
15.2%
3.0%
4.5%
3.0%
13.6%
Q4
78.9%
38.9%
45.6%
20.0%
-
14.4%
1.1%
3.3%
7.8%
21.1%
Q1
82.7%
37.8%
35.7%
18.4%
-
10.2%
2.0%
2.0%
3.1%
16.3%
Q2
80.7%
35.8%
38.5%
20.2%
26.6%
11.0%
0.9%
2.8%
4.6%
13.8%
Q3
89.0%
39.0%
37.0%
23.0%
14.0%
13.0%
1.0%
0.0%
1.0%
11.0%
Source: STRATA, 2010 & 2011
133699
Twitter

The falloff indicates that the fascination with Twitter’s ad
products has become more subdued, at least among the
agencies surveyed by STRATA. Additionally, it highlights the
differences between Facebook, considered a necessity in
the digital marketing world because of its outsize audience,
and Twitter, whose much smaller user base still puts it in the
experimental realm for many marketers.
Trends for 2012
Expansion of international ads. In September 2011,
Twitter introduced Promoted Products in the UK, allowing
advertisers to reach local users with relevant content. Starting
with a campaign promoting the TV show “Glee,” which airs
on the Sky network in the UK, other launch partners in the
UK included Eurostar, Paramount Pictures UK and Electronic
Arts. Another international focus area is Japan, where Twitter
has partnerships with several digital media companies and
recently hired a country manager. Twitter is currently available
in 17 languages, leaving the door open to introduce ad
offerings in other markets worldwide.
Self-serve plus geotargeting. These two offerings in
combination will help smaller and local businesses use Twitter
to target audiences in specific regions or cities, or who have
certain affinities. Currently, Promoted Accounts and Promoted
Tweets can be targeted to most countries and US metro
areas, but Promoted Trends are available only on a global buy.
Geotargeting Promoted Trends is a logical next step.
Better metrics. As is the case with Facebook, marketers
want to know more than whether someone clicked on an ad
or shared it with their followers. They want to know if the ad
drove results. Twitter has promoted the fact that its ads are
highly engaging, but it must partner with marketers to show
how social engagement translates to sales and leads.
Twitter

LinkedIn, which went public in 2011, is proving that offering
social media advertising to B2B marketers can be a solid
revenue stream.
LinkedIn’s ad business,which it refers to as its Marketing Solutions
business segment,had 2010 revenues of $79.3 million,according
to the company’s S-1 document,accounting for about one-third of
the company’s total revenue.eMarketer forecasts that LinkedIn’s
ad revenue will rise 78.5% in 2011,to reach $140.8 million.
Recruitment services offerings have increased as a percentage
of revenue, reaching 42% in 2010, while premium subscriptions
have fallen to 25% of revenue. However, advertising has remained
a steady backbone of LinkedIn’s service, giving marketers the
ability to target ads to the highly sought-after professional
audience. Like Facebook, LinkedIn offers both direct sales via its
ad sales team and a self-serve ad system.
LinkedIn does not break out its US vs. non-US ad revenues,
but it does provide a breakout of its total revenues. For all of
2010, about 27% of total revenue of $243.1 million came from
international markets, LinkedIn reported. And in the first half
of 2011, 31% of the company’s $121 million in total revenue
came from outside the US.
eMarketer uses these percentages as a gauge of the US vs.
non-US ad revenue split and estimates that 68% of 2011 ad
revenue, or $95.7 million, will come from the US, with 32%, or
$45 million, from elsewhere.
LinkedIn Ad Revenues Worldwide, US vs. Non-US,
2010-2013
2009 2010 2011 2012 2013
US
Non-US
Worldwide
$28.3
74%
$10.0
26%
$38.3
$57.1
72%
$22.2
28%
$79.3
$95.7
68%
$45.0
32%
$140.8
$126.6
63%
$74.3
37%
$200.9
$149.8
60%
$99.8
40%
$249.6
Note: ﬁgures represent revenue from LinkedIn's Marketing Solutions
business segment
132446
Trends for 2012
Three factors will contribute to the continued growth of
LinkedIn as an advertising destination.
Increase in users. LinkedIn ranked as the fourth most-visited
social network in the world in June 2011, with 84.4 million
unique visitors, according to comScore.As of October 2011, the
company had more than 120 million members, up from 72 million
in June 2010.
Increase in page views. The number of page views
increased 88% to 14.2 billion in the first half of 2011, LinkedIn
reported, using comScore data. Continued growth in page
views will demonstrate increased user engagement. One of
the common criticisms of LinkedIn has been that users do
not spend much time with the site. By providing regular email
updates about a member’s connections, as well as a Twitter-
like stream of comments and activity, LinkedIn has drawn
more users to its features.
LinkedIn
LinkedIn Ad Revenues Worldwide, 2009-2013
2009
$38.3
2010
$79.3
2011
$140.8
2012
$200.9
2013
$249.6
Note: ﬁgures represent revenue from LinkedIn's Marketing Solutions
business segment
107.0%
78.5%
43.7%
24.3%
132445
Highlights
■■ LinkedIn will generate $140.8 million in worldwide
ad revenue in 2011, and reach $249.6 million in 2013.
■■ Future growth is predicated on increases in unique
visitors and time spent on the site.

Improved ad targeting and ad offerings for B2B
marketers. LinkedIn offers two main ad products: a self-serve
text ad product sold on a cost-per-click basis, and an enterprise
product that includes display ads, branded groups, sponsorships
and white papers. In October 2011 it unveiled two new features:
company status updates, enabling companies to communicate
directly with their followers, and a certified developer program
that marketers and agencies can tap to create marketing
programs on LinkedIn.
Despite the user growth, LinkedIn still trails other social sites in
engagement.According to comScore data cited by investment
bank Evercore Partners in an August 2011 research note,
between January and June 2011, each unique visitor to LinkedIn
viewed an average of 30.1 pages per month. Facebook users,
on the other hand, viewed an average of 522.5 pages per month
during the period. Even Myspace users viewed more pages, 43.3
per month, according to comScore.
By its own admission, the company is less focused on
improving those engagement metrics. CEO Jeff Weiner said
during the company’s Q2 2011 earnings conference call:
“Sometimes we get asked about time spent, and as we like to
say, it’s not about enabling people to pass the time, it’s about
enabling people to save the time.”
If LinkedIn can make business-focused social networking more
efficient for its users,it will keep them coming back,and advertisers
will see the benefits of an engaged professional audience.
LinkedIn

Google’s newest social network is its most ambitious effort
yet to attract consumers—and marketers—to socialize with
the search giant. Google+ will formally open up to marketers
in late 2011, offering business profile pages that enable
companies to create “Circles” and “Hangouts” to market to
segments of the Google+ user base.
Google earlier this year started adding +1 information—its
answer to Facebook’s “like” button—to search results. Now,
if a Google+ user clicks the +1 button next to a brand, story,
comment or other piece of content, that information will appear
not only in his or her friends’ Google+ newsfeeds but also in the
search results if a friend searches for the same thing.
“When search results and search ads have personalized
annotations, there is a very real change in clickthrough rate to
the benefit of you as a publisher or advertiser,” said Christian
Oestlien, Google group product manager for social advertising,
during a presentation at the Ad Age Digital West conference in
September 2011.
In a limited test of adding +1 to search results, Dutch search
engine optimization company SEO Effect found that a +1 mark
“has a higher visibility in a search result, which could raise the
clickthrough rate to the website.”
Google will also add the +1 button to ads on the Google Display
Network, enabling people to recommend ads to their friends.
eMarketer will monitor these developments and may publish
a breakout forecast for Google+ ad revenues in future reports.
In the meantime, there has definitely been curiosity over how
Google will use its social network to enhance the marketing
and advertising opportunities provided by its search engine,
Gmail, YouTube and other products.
In Q2 2011, when Google+ launched, 26.6% of ad agencies
surveyed by STRATA said they were likely to use the site for
their clients’ campaigns. However, in Q3 2011, the percentage
fell to 14% as Google+ remained closed off to marketers.
As of August 2011, 8.1% of the top 10,000 websites worldwide
had already placed a link to Google+ on their homepage,
according to BrightEdge.
% of top 10,000 websites
Social Links or Plugins on the Homepage of Websites
Worldwide, Aug 2011
Facebook 50.3%
Twitter 42.5%
Google+ 8.1%
LinkedIn4.0%
Source: BrightEdge, "Social-Share Analysis: Tracking Social Adoption and
Trends," Aug 29, 2011
132097
Early usage trends for Google+ have been up and down. Early
adopters flocked to the site after its closed field trial began
in June, but many stopped visiting after kicking the tires for a
while. Usage picked up again in late September after Google+
entered open beta.
According to Experian Hitwise, Google+ was the eighth most
visited social media site during the week ended September 24,
2011, with a 0.55% share of visits. The week before, it ranked
54th. However, analytics company and online ad network
Chitika said in October 2011 that while usage rose dramatically
the day the site went into open beta, it fell sharply in the
succeeding days.
Google+
millions and % share
Top 10 US Social Media Sites, Ranked by Visits, Week
ending Sep 24, 2011
Visits % share
1. Facebook 1,758.1 64.85%
2. YouTube 530.1 19.55%
3. Twitter 33.1 1.22%
4. Yahoo! Answers 28.0 1.03%
5. Tagged 19.7 0.73%
6. LinkedIn 17.8 0.66%
7. Myspace 16.3 0.60%
8. Google+ 15.0 0.55%
9. myYearbook 10.6 0.39%
10. iVillage 10.3 0.38%
Note: excludes mobile traffic or traffic from the Google Notification Bar
Source: Experian Hitwise as cited in company blog, Sep 26, 2011
132863
Highlights
■■ Google+ will open up to brands in late 2011, offering
business profile pages and linking the +1 button to
search results and ads.
■■ Usage is ticking upward as the site moves beyond
the test stage.
■■ Questions about the size of the Google+ audience
may be moot if Google can successfully meld social
and search for marketers.

In August 2011, 22% of US internet users said they currently
used or were likely to join Google+ in the next 12 months,
according to a survey by Bloomberg and YouGov. That was
greater than the percentage who said they were using or
might join LinkedIn, Twitter or Myspace.
% of respondents
Select Social Networks of Which US Internet Users
Are Members, Aug 2011
Estimated
penetration*
Facebook 69%
LinkedIn 20%
Twitter 20%
Myspace 13%
Google+
Current
penetration
71%
19%
18%
14%
13%
Likely
to join*
1%
2%
3%
1%
9%
Likely to close
account*
3%
<1%
<1%
2%
<1% 22%
Note: *in the next 12 months
Source: Bloomberg andYouGov survey as cited in company blog, Aug 5, 2011
131536
When looking at the conflicting data about Google+, marketers
should remember that Twitter still faces questions about its
usage several years into its existence.
eMarketer will be watching Google+ usage carefully, but it is
entirely possible that the site will not need an especially strong
user base to be successful.Any information that Google is able
to glean from Google+ users can be used to improve ad targeting
for the rest of its products. Facebook doesn’t allow Google to
access content that its users do not make public, which means
a significant portion of social activity on the web is unavailable to
Google’s search engine. Google+ will help fill that gap.
Spotlight: How Ford Uses Google+
Even though Google has prevented other marketers
from using Google+, Ford Motor Co. was allowed to
create a brand profile on the site. In an interview with
eMarketer, Scott Monty, Ford’s digital and multimedia
communications manager, described the company’s
early learnings from its test account.
What Ford has learned so far: “Our followers on Google+
want more personal interaction and opportunities,
especially as the platform supports it. They want us to
use the Hangout feature. They want to chat directly with
people deep within the Ford organization—engineers,
designers, product people—rather than executives or
marketers. And they want content that isn’t simply a
replication of what they might be getting on Facebook.”
How Ford is building its follower base: “We’re
providing unique visual content—views from inside
Ford buildings, rare vehicles that may be in our lobbies,
historical photos from our archives and occasional
interaction with Ford employees via video.”
How the company uses Hangouts and Circles: “We
live-streamed a forum that included a Hangout. We
plan to have more interaction with our designers
and engineers. We haven’t bothered with Circles yet
because, frankly, we have no way of knowing enough
about our fans to be able to categorize them. That’s
one of the dangers of brands using a personal Google+
profile as it currently exists.”
How Ford integrates Google+ into other social
media efforts: “We’re not doing that at this time, but
we’ll certainly be looking at it, especially since Google
announced that the +1 button would be turned on in
certain advertising.”
Google+

Q&A: How can marketers use Google+?
Ad industry executives are intensely curious about the marketing
opportunities Google+ will offer.While they are excited about
how to maximize the relationship between Google+ and other
properties, they also question how many people will use the
social network and how engaged they will be.
Marc Ruxin
Chief Innovation Officer
Universal McCann
“The jury’s still out on Google+. Clearly, most people that
are on the internet interact with Google a little bit every
day, whether they’re doing a search or going to YouTube
or opening their Gmail account. So having a timeline-like
presence on Google makes sense. I don’t think it’s a Facebook
killer, but it’s certainly a good way to pull together all of the
disparate Google connections that a consumer has.”
Dave Williams
CEO and Co-founder
BLiNQ Media
“We think Google+ is potentially the biggest competitor for
Facebook in terms of Google’s track record, size and the ability
to quickly execute products. Compared to Facebook, Google
is more of an ROI platform, so Google+ creates more brand
opportunities. Google is also able to capture a lot of user data,
which it can use across all its various products, including
Google+. We definitely think Google’s going to be a big player
and we don’t want to understate that—but at this point, it’s
still relatively early and there will be a lot of unknowns.”
Justin Merickel
Vice President of Marketing and New Product Development
Efficient Frontier
“Google+ is very interesting to clients, but there aren’t brand
pages yet. That’s going to be a quickly evolving market,
depending on how that product takes off. The ad benefit is
going to be huge. If you look at Facebook’s Sponsored Stories
as an ad unit, and what social endorsements mean in terms of
improved efficacy, there’s a tremendous opportunity if Google
can capitalize on what’s happening with +1 activity and with
the connection activity in Google+.”
Josh Martin
SVP, Director of Client Services
ID Media
“It has the potential to be a very competitive threat to
Facebook most directly. Will it be a threat next year? No, it will
take a while. Given what Google can do from a contextual
targeting ability, particularly within search, that is a bit of a
weakness associated with Facebook. I see that as an inherent
strength coming out of Google.”
Google+

Worldwide social game ad revenues will continue to rise
through 2013 as marketers expand their presence in this
channel. In the US, eMarketer projects that social game ad
revenues will reach $291.9 million in 2012, growing by 42%
from $205.4 million in 2011.
For purposes of this forecast, eMarketer defines a social
game as a game played within a social network. We
recognize that some social game companies, such as
Zynga, are developing games that do not need to be
played within a social network and we may update our
definition in the future.
A May 2011 report by William Blair & Company estimated
even higher US social gaming ad revenues. The firm expects
revenues to reach $1.645 billion in 2015, growing steeply from
$712 million in 2011.
millions
US Social Gaming Ad Revenues, 2010-2015
2010
$517
2011
$712
2012
$896
2013
$1,147
2014
$1,374
2015
$1,645
Source: William Blair & Company, "The Future in Digital Media," May 16,
2011
131836
Blair includes areas that eMarketer did not count in its
estimates, such as lead generation offers and branded virtual
goods. These inclusions help to explain why Blair’s figures are
considerably higher than eMarketer’s.
Social Gaming
Social Gaming Ad Revenues Worldwide, US vs. Non-US,
2009-2013
US Non-US
Note: includes display, video, search and other forms of paid advertising;
excludes spending by marketers that goes toward developing or maintaining
branded social games; numbers may not add up to total due to rounding
2012
$449.1
$291.9
$157.2
2013
$641.0
$416.7
$224.4
2009
$124.4
$99.5
2010
$162.7
$122.0
$40.7
2011
$293.4
$205.4
$88.0
$24.9
30.8%
80.4%
53.1%
42.7%
132441
Highlights
■■ Worldwide social gaming ad revenues will reach
$641 million in 2013, up from $293.4 million in 2011.
■■ The US will account for 65% of the total in 2013.
■■ Social games are attractive to marketers because they
have an immersive environment and an audience that
is receptive to branded content and offers.
■■ Virtual goods represent the majority of revenue
for social games, but ad revenue is increasing as
marketers test branded integrations, video ads and
other formats.

The Blair study also included a breakdown of social gaming ad
types and concluded that brand engagement ads made up the
biggest share of revenue in 2010.These ads include homepage
takeovers, branded items and cross-promotions such as a recent
campaign by Paramount Pictures to promote its animated feature
“Rango” through the Zynga title FrontierVille.
Advertising
$517
Social gaming
revenues
millions
US Social Gaming Revenues, by Type, 2010
Source: William Blair & Company, "The Future in Digital Media," May 16, 2011
Micro-
transactions
$800
Subscriptions
and purchases
$500
Advertising
Brand
engagement
$240
Lead
generation
$162
Display
advertising
$115
131837
It should be noted that virtual goods represent the majority of
revenue for most social games, while advertising represents a
very small portion. For example, advertising accounted for just
5.4% ($28.2 million) of Zynga’s revenue ($522 million) in the
first half of 2011, according to the company’s S-1 filing.
Similarly, in 2010, advertising represented only 3.8% ($22.8 million)
of Zynga’s total revenue ($597.5 million). However, advertising
played a greater role in 2009, when 29.4% ($35.7 million) of
total revenue ($121.5 million) came from ads.The decline in ad
revenue from 2009 through 2011 resulted from Zynga limiting the
number of in-game offers it showed to users.
eMarketer’s growth forecast for social gaming ad revenues is
based on the following assumptions:
A rise in the number of social game users. eMarketer
forecasts that there will be 73.6 million social gamers in the US
in 2013, up 18.9% from 61.9 million in 2011. These avid gamers
represent an attractive audience for marketers.
A receptive audience. As long as the ads make sense within
the game and do not intrude on the flow of play, gamers have
shown that they accept seeing ads in exchange for game play
or virtual currency.
A marketer-friendly climate. Brand campaigns tend to be
more effective in these lighter, less-immersive games than in
traditional, action-based titles.
New ad types. Social game companies are experimenting
with different ways to incorporate ads, including offering
branded virtual goods or in-game environments; showing
video ads in exchange for virtual currency; and placing ads on
game-start pages.
Zynga now offers three types of advertising: branded virtual
goods/sponsorships,“engagement” ads (in which users engage
with an ad and receive virtual currency) and mobile ads.
“If you look at CityVille, there’s a lot of real
estate on each person’s game board, and
there’s no reason that your city shouldn’t
represent who you are as a player and what
you’re interested in. A city with the brands
you like, and where those brands actually
help you in-game, will enhance the reality
of that city for you.” –Jeff Karp, chief marketing and
revenue officer at Zynga, in Advertising Age,August 22, 2011
Social Gaming

Q&A: How do marketers view social game ads?
Social game ads are intriguing to marketers and agencies
because some formats, such as in-game placements,
offer the possibility of strong user engagement. But
there is also concern that other ad formats, such as ones
that reward players for viewing a video, have much less
engagement potential.
Josh Martin
Senior Vice President of Client Services
ID Media
“These are the questions we are trying to figure out: How do
marketers operate within social game environments? Is it the
incentivize model: Get free elements in the game in exchange
for consumption of an advertisement? And what value does
that have to a marketer?
“But the usage is incredible and the consumer experience,
overall, is very strong. When the consumer is getting a free
game, and in exchange they have to get exposed to some ad
messaging, in most cases that’s an exchange that they would
be happy with.”
Marc Ruxin
Universal McCann
“I look at environments like Zynga to become massive
repositories for social spend. When you put a branded crop
inside FarmVille and a bunch of people pay a bunch of money
to buy virtual organic blueberries, if you’re General Mills, you
can tick the box called, “User saw my ad.” Not only did they
see it, they thought about it and they paid real money for it.”
Micah Nyatsambo
Media Contacts
“We have run test campaigns. Some of them have worked out,
but at the end of the day, a lot of clients have asked,‘How many
people signed up for this only to get the rewards and don’t really
care about the brand itself?’ The clients have been happy with
the interactions, but a lot of them have been just tests.”
Conclusions
Social networks have cemented their place in
advertising. Marketers recognize the importance of reaching
consumers where they are. And for many marketers, that
means not just conducting marketing activities, but buying
paid advertising. The result will be a $10 billion market in 2013.
Facebook will get the vast majority of social network
ad revenues. With $7 of every $10 in social network
advertising flowing to the company, Facebook is also taking
an increasing proportion of total online ad spending. Although
its ad offerings and metrics aren’t perfect, marketers still feel
they need to be there to reach their target audience.
New ad products and international offices will propel
Twitter. Ad revenues should reach $400 million in 2013, as
Twitter rolls out sales offices outside the US and prepares to
unveil its self-serve ad platform. It must work hard to keep the
ad buzz going among marketers, while at the same time keep
from inundating users with marketing messages.
LinkedIn benefits by offering a premium audience to
B2B marketers. Ad revenue is a steady backbone to the
company’s business, exceeding $200 million in 2012 and
nearing $250 million in 2013. Increases in the number of users
and page views, as well as new targeted ad offerings, will
support ad revenue growth.
Google+ is a wildcard. Early usage trends are up and down,
but marketers are anxious to test the social network when it
opens up later this year. Even if it doesn’t attain hundreds of
millions of users, Google+ may still be successful if it can offer
marketers a blend of search and social advertising that its
competitors cannot.
Social games present an attractive, engaged audience.
Because users are willing to engage with ads in exchange for game
assets or virtual currency,marketers are testing brand integrations,
video ads and other formats that will propel the social game ad
market to $449.1 million in 2012 and $641 million in 2013.
Social Gaming

Appendix: Social Network Ad
Revenue Forecast Methodology
eMarketer has been forecasting social network ad
revenues since 2006. By examining the long-term
patterns of revenue growth or loss, and viewing those
figures through the lens of current ad spending trends
and marketers’ future intentions, eMarketer is able to
develop its projections.
Major players. We begin to estimate the size and growth
curve of the social network ad market by tracking the major
ad-selling players: Facebook, LinkedIn and Twitter, as well
as several dozen international social networks, social game
developers and social app companies.
Other research firms. Several researchers project social
network or social media ad revenues and/or revenues for
individual social network companies. eMarketer aggregates
these projections; the details behind how other researchers
come to their numbers helps to inform eMarketer’s
forecasting process. We include these comparative estimates
for transparency, not necessarily to determine market size.
Other available data. We consider data on marketer usage,
consumer usage, ad impressions and ad pricing as part of
our model.
Interviews with industry executives. We conduct
interviews with executives at ad agencies, marketers and the
social networks to gain perspective on the development of the
social network advertising business as a whole, as well as the
revenues for individual companies.
eMarketer Interviews
Wells Fargo Counts on Social Media Measurement
Alan Gellman
SVP of Digital Marketing
Wells Fargo
Interview conducted on August 17, 2011
Samsung’s Social Spending on the Rise
Kris Narayanan
Vice President of Digital Marketing
Samsung
Southwest Builds up Social Channels to Communicate
with Travelers
Alice Wilson
Associate Manager of Social Marketing
Southwest Airlines
Adam Bain
President of Revenue
Twitter
Interview conducted on July 26, 2011
Deidra Bodkin
Vice President of Media
Razorfish
Carolyn Everson
Vice President of Global Marketing Solutions
Facebook
Josh Martin
SVP, Director of Client Services
ID Media
Joe Mele
Senior Vice President, US Media
Razorfish

Justin Merickel
Vice President of Marketing and New
Product Development
Efficient Frontier
Scott Monty
Digital and Multimedia Communications Manager
Ford Motor Co.
Interview conducted on October 3, 2011
Sean Muzzy
Senior Partner and Managing Director
Neo@Ogilvy
Micah Nyatsambo
Media Contacts
Amanda Richman
President of Digital
MediaVest
Marc Ruxin
Universal McCann
Sid Shah
Senior Director of Business Analytics
Efficient Frontier
Dave Williams
CEO and Co-founder
BLiNQ Media
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