How to make ad revenue from the social web

Advertising Week and CNBC recently held an event with the titans of the social web. Called Masters of Monetization 2.0, the event brought together top revenue and ad execs from LinkdedIn, Twitter, Foursquare, Buzzfeed and Tumblr, as well as some Madison Avenue mad men.

Together, they came up with some insights into how to bring in revenue from the social web, an issue which has long plagued even the hottest tech companies.

There was also a growing focus on mobile, with significant amounts of social network traffic coming via smartphones and tablets.

One of the key findings was that some of the most effective monetization of social content is when the advert is embedded into the content stream itself. Not only does this irritate users less as it doesn’t interrupt their experience, it also translates well into mobile.

BuzzFeed’s CRO, Andy Wiedlin put it this way: “If you can get into the feed where people are looking and not piss them off, that works.”

Mobile really has been the big sticking point for many of these companies. The ones that have adopted best were, not surprisingly, the companies who started off on mobile in the first place. It is much easier for a Foursqaure to monetize mobile than LinkedIn. Interestingly, Twitter have somewhat bucked that trend, and now make more money from mobile than desktop.

Wherever the ads is though, it is becoming clear that advertisers are going to have to invest money to make the ads look good and be interesting to potential clients suffering form information overload. This means that they have to be aesthetically pleasing as opposed to just data driven, and ad teams have to be flexible and produce eye catching content quickly.

Social ads are all about engagement, and whether a company attract the right consumers attention and get them to spend money on a product. Different social networks by their nature attract different people, so a community on LinkedIn has a different value to one on Facebook or Twitter.

Indeed, according to PaidContent: “LinkedIn, for instance, claims that leads based on its professional profiles are three times more likely to convert than the personal ones on Facebook.”

Equally, these networks are extremely fluid. Twitter VP Joel Lunefield points that “there’s established communities and communities that just establish around an event”. This all means advertisers have to swoop in quick to get the customers, backing up the point made earlier about having flexible ad teams.

It may seem odd to say given how used to it we all are now, but social is still a relatively new world, and all these companies have to prove to advertisers that they can secure a sale. An audience is simply not enough.

One of the advertising industry reps, Jim Murphy, summed it up, saying:

“At the end of the day, a brand spends money to drive a sale … if you can prove it, you’ll win,”

CNBC Masters of Monetization 2.0 by advertisingweek