The eMarketer View
The bad news is that social network sites have yet to find a solid revenue stream.
The good news is that there is still time.
The number of Internet users visiting social networks at least once a month increased an estimated 11% in 2008, to 79.5 million, and will rise another 11% in 2009, to 88.1 million. Between 2008 and 2013, the number of social network users in the US will increase by an estimated 44%, to 115 million.
Social network usage is not tapering off. Instead, it is growing. Not only are more consumers joining social networks, but their level of involvement is deepening.
The steady increase in usage is one of several trends in 2009. Others include:
Demographics are expanding. Social networking is still a frequent activity for teens and young adults, but with usage rates already very high there is little room for more growth. The next growth area will be among members of Generation X, followed by boomers. There will also be increased activity in the tween market. According to JPMorgan, 62% of adult Internet users ages 34 to 41 visited social networks monthly in 2008, up from 53% the year before. And 34% of 11-to-12-year-olds surveyed by Cox Communications in 2008 said they had a social network profile.
Engagement: no plateau yet. The number of people who visit social networks on a weekly or daily basis is growing. The amount of time spent on these sites in the first nine months of 2008 grew at double the rate of overall time spent on the Internet, according to comScore Media Metrix. Consumers are also making social networks a part of their everyday conversations: A 2008 survey by Deloitte found that people were more likely to discuss social networks daily than they were to talk about newspapers, books, magazines and radio programming.
Facebook membership is soaring. The site reached 150 million worldwide members in January 2009, from 130 million as recently as November 2008. In the US, membership more than doubled to 43 million in December 2008 from 21 million in December 2007. At that growth rate, it may soon surpass MySpace in traffic.
Mobile and the Twitter effect. Mobile social networking is growing, thanks to devices such as the iPhone that provide a better user experience. Online social networks are also making it easier for mobile users to participate in certain activities that are commonly done online, such as uploading video. However, Twitter will have the most profound effect on mobile social networking, making it as easy as typing 140 characters and uploading a photo to share information—and break news—with friends and followers worldwide.
Socializing the shopping process. Consumers may say the primary reason they use social networks is to connect and communicate with friends, but the stream of status updates and posts contains myriad nuggets of information about the products they use, the media they consume and what they plan to buy. With the mainstreaming of social networking, consumers will be even more likely to turn to their contacts for advice and recommendations. And marketers have an opportunity to present an engaging offer at the right time.
Social networking continues to evolve and change. And social network marketing must evolve with it. Ideas that worked in 2007 or 2008 may not be relevant in 2009. And conversely, a failed idea from 2007 just might succeed today. Consumers are more savvy about social networking now than they ever have been before.
Your target audience is here. Young people may currently be the heaviest users but new growth is coming from Gen Xers, many of whom are already logging on frequently. There will be an estimated 44% more social network users in 2013 than there were in 2008.
Activity begets activity. There is a tipping point at which social networking goes from being a curiosity to a daily or even hourly addiction. This transition often happens quickly. More than one-third of users already visit their profile daily, according to Pew. The imperative for marketers is to make sure their social network activities are as fresh and current as the constantly changing profiles of their members.
Microblogging will create new types of social networks. Twitter is more than a place where people post the minutiae of their everyday life. It is becoming the destination for news, links and questions both asked and answered. The ease of spreading information and commenting on it enhances the information and gives it added resonance. Consider Twitter a precursor to other new types of social networks—not actual Web destinations but ad hoc networks of people connecting and sharing over multiple platforms.
Explore the link between social networks and shopping. Consumers are getting a lot more information about products and services from social networks than marketers think—and very little of it comes from the marketers. Status updates and social network posts contain myriad bits of data about consumers’ likes, dislikes and potential purchases. This organic flow of information is difficult to track and capture, but companies should find the tools to understand the impact of social network communication on the purchase process.