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Social Ad Systems Emerging — Slowly

January 26, 2011

vcmike

As social continues to take over the web, social ad systems are ever so slowly starting to emerge.

Yesterday, Facebook announced its new “sponsored stories” ad product, where brands can promote a user’s interaction with the brand to the user’s friends.  And just this morning it is reported that Twitter has begun testing its own self-serve platform for “promoted tweets.”

It will be interesting to watch whether Facebook and Twitter vying for brand dollars will accelerate the evolution of social ad systems.  I could be wrong, but it seems to me that while in general the social web moves at a far more rapid pace than did the Google-era web, efforts at monetizing have been come more gradually as the current mindset prioritizes growth and market dominance over monetization.  I took a look and discovered that Google rolled out AdWords just a bit over a year after raising its first VC round, whereas today consumer/social web entrepreneurs and VCs alike seem more comfortable to be single-minded about growth for longer periods.


2 Comments

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  1. February 2, 2011

    Here is a question: Will the pace of change in social be so rapid that it gets too far out in front of ad systems so social can’t make money? Clearly Facebook will monetize at massive value, but will Foursquare be replaced by something new after it has had its day in the sun and before it can make money at what it does?

  2. June 8, 2011

    I think there is also an argument that communication tools are not as effective advertising environments as, say, search tools because people are so busy interacting that they are not receptive to new messages. Will people endorse brands voluntarily in enough volume to make social media as lucrative as search? It will be interesting to watch.

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