Social Networking- the Revenue Generator


Social Networking- the Revenue Generator

While performing some research on social networking domain, found some interesting figures to share, which can surely drive the social networking development companies.

Market at a glance:

The marketplace for the web and social networking communities is estimated at about USD 1500M this year.

Social network/Community development and enhancement individually by 2006 stood at USD 700M and is estimated to the touch USD 4000M by 2010.

The top 3 player within the market are Myspace, Facebook and Bebo with market shares 80.74%, 10.32%, 1.18% respectively.( data is predicated on custom category of 20 of the leading social networking websites ranked by market share of visits, which is that the percentage of traffic to the location , supported Hitwise sample of 10 million US Internet users. The percentages represent the market share of visits among the websites within the custom category.)

Growth Path:

Social networking sites are growing 47% year on year increasing from an audience of 46.8 million to 68.8 million in April 2006.

Social networking sites are the truth of the Internet; the content is comparatively inexpensive for publishers to supply .

It will become more ingrained in mainstream sites, even as reality TV shows., the highest Social Networking site of beat terms of number of registered users, saw a staggering 367% increase. The graph remains increasing with more Social Networking players jumping in; the online scene seems set good for Social Networking.

The social networking sites that are seeing strong growth have developed a singular online presence which is refreshed by user generated content. This promotes ongoing consumers interest and visitor loyalty. The market share of Internet visits to the highest 20 social networking websites grew by 11.5 percent from January to February 2007, to account for six .5 percent of all Internet visits in February 2007.

Mobile Social networking: The next Destination

Social networking goes mobile and is poised for spectacular growth over subsequent five years, mobile social communities are going to be attracting members in swarms, quite tripling in size from 50 millions to 174 millions by 2011.

For the moment, MySpace and Facebook are hot. News Corp. paid $580 million last year for MySpace as a part of a $1.3 billion Internet acquisition spree. Facebook just received a further $25 million in risk capital .

Both companies are getting to extend their reach beyond the pc screen to cell phones.

Cingular Wireless, Sprint Nextel and Verizon Wireless are starting a service which will allow users to post messages on Facebook’s home pages or look for other users’ phone numbers and email addresses from a cell phone.

MySpace features a pact with Helio, a wireless venture between SK Telecom and Earthlink, which can allow users to send photos and update their blogs or profiles by telephone .


Social networks are an integral a part of the cultural fabric of the web and their rapidly growing and demographically appealing audience has attracted the eye of advertisers.

According to the newest forecasts, marketers will cough up an estimated $280 M within the USA to advertise.

By 2010, the web advertising spend will grow to $1.8 billion.

Marketer estimates that the social networking ad spend of the USA will rise to $260 million in 2007(up from $95 million in 2006), and by 2010 is expected to reach $665 million.


Advertising on social networks or Social Media Marketing will teach marketers important ways to succeed in newly-empowered consumers.

Social networks will have an incalculable influence on all advertising, both online and offline.

If companies can go even deeper to develop marketing efforts that fully embrace the “one-to-one-to-many nature of social networks, ad revenues will soar. This way of advertising will spill over into other channels. The underlying concept will influence the way advertising is completed altogether media, not just online.

Social Networking: The revenue Generator

Advertisers delight: Advertisers can target local also as international market at one place.

Social networks are getting an honest environment to sell products, especially if marketers want to cultivate a brand and obtain its loyal users to try to to the selling and evangelizing. That evangelism happens in a community.

Recruiters’ Heaven: Now each day , top MNCs are hiring from professional social networking sites like Linkedin. They can also check the social index and compatibility of the candidate along side the background check, which helps them to save lots of tons of cash .

The cost of gaining new customers is practically nothing because users join voluntarily and supply their own content through their profiles.

The interactive nature of social networking sites keeps visitors returning which helps the sites to retention rate high.

The cost of running the sites’ web servers is comparatively low. If a classic advertising or subscription revenue model is employed , low cost social network sites might be highly profitable.

All the above information concretes our philosophy that social networking as a website for business goes to remain and grow during a rapid rate.

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