It seems there is something to advertising on social network sites after all.
One out of every five display ads Web users viewed in June 2009 came from social networking sites such as MySpace or Facebook, where more than 400 million users congregate to share information about themselves and play games online, according to new research from consultant comScore.
The study showed that social networking sites accounted for 68.9 million display ad impressions out of 326.9 million total display ad impressions, good for more than 21 percent of all display ads viewed online. Together, MySpace and Facebook accounted for more than 80 percent of display ads among social network sites.
At 250 million users, Facebook has nearly twice as many users as MySpace user base of 130 million. However, MySpace led social network ad sites with 30 million display ad impressions. Facebook followed with 26.8 million impressions.
Users spend so much time on MySpace and Facebook, as well as sites such as Tagged.com, Bebo and Hi5, that these social networks present lush, green fields for online ad opportunities at a low cost. That is why advertisers are keen on using social networks as vehicle for delivering ads, comScore Senior Vice President Jeff Hackett said in his report.
"Social media is becoming an increasingly attractive vehicle for major advertisers seeking to optimize campaign reach and frequency and smaller advertisers desiring to reach a highly targeted audience," added Hackett.
"As social networking sites innovate on their existing ad offerings, the category should continue to grow in ad volume." CPMs, or the cost per thousand ad impressions, could also increase if the sites can demonstrate a fat return on investment, he said.
Hackett found that AT&T ranked as the top display advertiser on social networking sites in June with more than 2 billion ad impressions. This accounted for 30 percent of the company's total number of display ads delivered during the month.
What's interesting about this is that AT&T is the sole carrier of the Apple iPhone, the world's most popular smartphone. Users are increasingly adopting smartphones to browse the Internet, play games and communicate with friends, family and colleagues.
The iPhone, along with the Palm Pre and gadgets from RIM and devices based on Google's Android mobile operating system, are expected to be the for the emerging mobile advertising industry. Many experts believe the market for social network ad will get even bigger once the majority of the world begins browsing the Internet from mobile devices.
See comScore's charts in their entirety here.