BUSINESS BLOGS
BUSINESS BLOGS
category: business
14 Apr 2009

Historically, no form of communication (email, IM) has been monetized effectively via advertising (yes, I am including spam).

Interesting to note the following from MySpace’s increase in professionally-produced premium videos at the expense of user-generated content, via Tech Crunch:

Like every other video site, MySpace is increasing the amount of professionally-produced premium videos because those are more appealing to advertisers. It sees the user-generated videos (UGC) more as a communication feature for MySpace members. MySpace’s video VP Jason Kirk tells me:

We have seen big increases in premium intent viewing over UGC. Premium content views probably close to doubled in the last year. USG video is part of the social network part of our site.

This echoes what I’ve been saying for some time now: social media totally obliterates the rules of publishing and media in general, but it does little to change advertising.  In fact, the only real impact on advertising is an influx of cheap inventory and a harder job of cutting through the noise.  But the notion that marketers will embrace social media is plain misguided, because the problem with UGC’s “value  proposition” is that

- direct marketers (who might not mind UGC’s low quality and raciness) don’t like the low performance

whereas

- branded advertisers (who care less about the ROI in the short term) cannot take the risk to market alongside it.

This might hurt a lot of people’s feelings because for the past five years we’ve seen tens of billions poured into monetizing social media and we’re now seeing that it is impossible.  Never say never?  I’m saying never!