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The Social Web Economy: Social Web Agencies

Posted by Nick O'Neill on October 1st, 2008 10:53 AM

This is a continuation in the series “The Social Web Economy”

Social web agencies are the companies that help develop branded products on the social web. Currently large traditional media companies are the most prevalent organizations on social platforms and elsewhere on the social web but that is slowly beginning to change. These agencies specialize specifically on leveraging the distribution platforms for exposure and the product companies to purchase reach.

The social web agencies sell the development of a product and user exposure to those products as advertisements. This is because there is no way to guarantee that an application (product) is going to succeed in the long-run. In the best case an application will take off and maintain and active user base. How that works for the brand beyond their initial install buy will depend on how the contract between the agency and the brand was structured.

There are some fundamental challenges facing the social web agencies though including those suggested by Seth Goldstein this morning. When advertisers and brands are used to buying IAB-standard ads it’s an uphill battle in convincing them to build custom, non-standard applications. Thankfully large brands and advertisers in general are willing to experiment.

The agencies have tension on two fronts: distribution platforms and ad networks. The reason for tension is that these companies are taking away ad buys directly from the platforms as well as the ad networks. While some agencies combine ad buys with development, there are many clients that simply seek the development of high quality applications.

That’s not to suggest that there isn’t enough room for all companies to exist but in many circumstances each company is offering an advertising option that can be substituted for the other.

Next in this series: “The Social Web Economy: Ad Networks & Sales Teams“

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Viewing 3 Comments

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    I think you're missing a key element here: The deployment of advertising in social media has an added element of risk that it has not faced in traditional media including traditional Internet sites. This risk is the potential backlash possible in social media.
    If you serve up an irrelevant ad on a website or pitch a journalist with an inappropriate press release the likely outcome has been for the visitor or journalist to ignore it. In social media a likely outcome is for those exposed to your untargeted, impersonal message is for them to vilify it in a very public manner with this vilification being picked up on and spread by others.
    I do not believe that the model of broadcasting ads or messages, even with sophisticated behavioral targeting tools, in social media will work- no matter how much the media-buying world wants it to. Engagement in social media is one-to-one which appears to be labor intensive until you understand that its effect is exponential: You successfully engage one blogger or Tweet thread and potentially thousands of people see that exchange. This, IMHO, is the future of marketing: every message is a part of the conversation and tailored to it.
    Every day I talk to people who are realizing this and working to build a business model around social media. You know what's really interesting about that experience? Almost none of them are in advertising.
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    I think it has been interesting to see companies test new ideas in the social media space. We did our own little test (with no real expectations) and our community has grown to almost 400 marketers from all over the world in just 5 months time.

    www.inSocialMedia.com is the address if you are interested in seeing for yourself.

    Its all about sharing in the conversation. The companies that have the most active communities will probably see more effects from the community. But Martin is right, with the good, can also come the bad.

    Regards,

    Nelson Bruton
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    RESTORE THE ECONOMY

    Start with building government owned housing for the homeless...
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    Provide basic health care for all U.S. citizens...
    “ This would prevent expensive emergency room calls.”
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    “ This would make the U.S. more competitive in the world.”
    Provide basic nutrition ...
    “ This would make the overall population much healthier, and
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    Posted on :
    “ youtube.com/aclepd ”
    “ dailymotion.com/robert_howard “

    If you like this idea, please feel free to pass it on

    Thank you,
    Robert Evan Howard
    aclepd.com
    aclepd@aclepd.com

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