GOOG: Social ads — not so much

by Mathew on January 31, 2008 · 1 comment

One interesting point from Google’s much-discussed quarterly results: Eric Savitz of Barron’s Tech Trader Daily blog notes that the company’s CFO said Google’s “social networking inventory is not monetizing as well as expected.” In other words, the social ads they’ve been running through MySpace and elsewhere? Not so much. That’s apparently why the company’s TAC or “traffic acquisition” costs (otherwise known as marketing) were higher than expected.

As Eric notes, this could make a lot of businesses that are counting on some form of social advertising quite nervous — including Facebook, presumably. I have to say, I don’t think that “social ads” are quite as simple a beast as some companies and marketers are thinking (or hoping) they are. In fact, I’m starting to think that there might even be an inverse relationship: to the extent that they are social, they’re not really ads, and to the extent that they’re ads, they’re not really social.

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