International and domestic companies, including advertising agencies, are paying more attention to emerging social networking websites as they seek to expand marketing of their brand products.
"Watching the latest ad campaign of Nike's and discussing it with friends on Renren.com is fun," said Arthur Guo, an engineer at a domestic machinery factory. "It's great to communicate with friends who share my interest in sports."
As urban professionals spend more and more time on the Internet, connected to friends and colleagues on social networking sites, advertisers see a burgeoning commercial opportunity.
Nike put on a media blitz, with commercials featuring football stars, on its public page on Renren during the World Cup. The campaign attracted more than 100,000 fans, and a large part were gained through existing fans passing on their comments and spreading to a whole new group of fans.
"Enhancing users' engagement and encouraging them to give feedback on our products is an important strategy for us," said Brenda Wu, media strategy manager at Nike. "We want to be where our customers are, and the campaign on Renren provided us a perfect chance to assess what people are saying and thinking."
User engagement
Alan Yan, founder and chief executive of AdChina, agrees. "Social media elicit very strong user engagement compared with web portals and other news websites because they span personal relationships with friends and colleagues," he said.
Shanghai-based AdChina currently utilizes more than 400 Chinese websites in marketing of brand-name products, including large portals such as Sina and Sohu, and smaller, emerging network sites such as Kaixin.com and Renren.com.
Ideal advertising, Yan said, combines a strong brand presence and the interactivity of potential buyers. Social networking provides both elements easily.
Compared with traditional advertising on news websites, distribution of brand images on social networks cuts to the chase faster and leaves a more lasting impression.
Word-of-mouth via blogs, by contrast, isn't as effective because blog entries are passed on from a single viewer to another, and feedback is often lacking. On social networks and microblogs, however, dozens of friends can receive the latest update at once and share feedback almost instantaneously. That feedback or comment can influence a whole new group of users.
In the modern wireless age, consumers are no longer passive recipients of advertising and media content; they have also become the creators of content, breaking through boundaries once exclusively managed by advertisers and the media, said Steve King, chief executive officer of ZenithOptimedia.
A brand product, tossed into the social networking mix, can be accompanied by updates from friends, fancy photos or even video clips. The rapid-fire communication can give a product a boost or a kick in the pants, and that opinion can be a powerful force in shaping more opinion.
Donna Li, general manager of marketing and media planning at Renren.com, calls this phenomenon "earned media" because it involves larger audiences that can't be reached only by traditional banner advertising. Thus, advertising effect on the social network cannot be measured only by the clicking of banner ads, but also has to take into account the part of earned media which is passed on by existing users to new fans and their activeness, she explained.
Renren.com, previously known as Xiaonei, or "on the campus" in Chinese, began as a social networking site aimed at college students. It now has about 160 million registered users, 80 percent of them in the prime consumer market age of between 16 and 35.
China's overall social network users stand at about 210 million, according to research house Analysys International. In the first half of this year, the market value grew 33.3 percent year on year to 489 million yuan (US$74 million).
Every aspect
Virtual communities will continue to expand and connect users in every aspect of their lives, the Analysys report predicted.
Market research firm Nielsen Co said its surveys show that users are favorably impressed by advertising on websites and what their friends say about products and services.
Banner ads on websites usually illustrate a key image of the brand, accompanied by a public page with detailed information about the products. Apart from providing links to its official websites, the advertiser also enables brand owners to insert video clips and photos on the site.
"We call it first-time spreading and second-time spreading," said Spencer Hung, senior director of product and research at Nielsen.
Big brand names, including Nike, adidas, Dell and top consumer electronics manufacturers, have opened their public home pages, allowing users to sign up as "fans." That allows users to receive new product introductions and even fashion tips on how to match the hottest apparel. Users can also leave comments on their video clips or small notes on these public pages, which will show up in updates visible to their friends.
"Most visitors to these public pages are very interested in discount information, how to match fashion apparel, even how to apply beauty makeup," Nielsen's Hung said. "And they are eager to send that information to friends on the network."
"All this communications between friends in the virtual world provides much more value to brand owners than they would have garnered through traditional media," he added.
Internet advertising spending in China jumped 84 percent from a year ago to 7.64 billion yuan in the third quarter of this year, Analysys International said.
That figure is expected to soar about 30 percent in the next three years, comprising 17 percent of total advertising expenditure in China, ZenithOptimedia projected.
Advertising revenue on social network websites accounts for only about 10 percent of total advertising spending in China. That's due in part to the slowness of some companies and advertisers to recognize a hot trend and jump on the bandwagon.
"Although social network advertising is rather new compared with traditional advertising on portals and is still not widely accepted compared with keywords search advertising, it will have a huge growth potential over the next two years," AdChina's Yan said.
Read more: http://www.shanghaidaily.com/article/?id=457509&type=Business&page=2#ixzz18L2OD8ua
