MySpace Delivers More Display Ads Than Yahoo
San Francisco – A recent alteration of MySpace’s site is now reaping fruits in its effort to monetize its 118 million eyeballs. According industry data from comScore, MySpace has surpassed Yahoo in terms of displaying advertisements, is the latest sign that ad business is heating up at social networking giant.
Yahoo Inc. lost its position of the U.S. marketplace for online display advertising to MySpace, which has served 56.8 billion ads 15.2% of the display ads on the Internet, while Yahoo recorded in at 53.1 billion display ads with a 14.2% share.
More local brands are flocking to new advertising opportunities on the home page, making MySpace, News Corp.’s Fox Interactive Media division served more display ads than any other U.S. Web property in June, according to new figures from online metrics firm comScore.
The streamlined revamping of its homepage in June placed a large ad space at the top of the page, which offers splashier video ad placements with interactive elements that can move throughout the site.
But even as the data indicates speedy growth of MySpace in terms of advertising viewer-ship, analysts say the social network site has struggled to draw top-dollar ad rates relative to Yahoo, known for attracting premium advertising rates.
“Social media gets all these ad impressions but not necessarily get the dollars,” said Colin Gillis, analyst at Canaccord Adams. MySpace’s cost per thousand (CPM) page views are significantly lower than that of Yahoo, he said.
Certainly it is remarkable that MySpace is serving more display ads than Yahoo now, although MySpace advertisements generally are not monetized or targeted as well as Yahoo’s, with Yahoo ad rates being sold at 5 times that of MySpace.
Though, the latest figures are striking considering the difficulties that have surrounded advertising on the social networks. Facebook’s CEO Mark Zuckerberg recently told attendees at the company’s developer’s conference that Facebook had not yet figured out its revenue model.
Both News Corp. and Google, which serves ads on Facebook’s rival MySpace, have admitted that squeezing ad dollars from the heavily trafficked site was not as easy as they thought.
A MySpace executive said it is bridging the gap with rivals such as Yahoo, Time Warner’s AOL and Microsoft Corp.’s MSN after the revamp of its home page in June, which has drawn in big-name sponsors such as Sprint and Wendy’s.
“Our CPMs have grown significantly,” Jeff Berman, MySpace president of sales and marketing, said of June’s growth spike. “Category by category, year over year, we are up double digits.”
Among other modification, the site now levies a premium for Friday homepage buys -– tapping into the market of film companies trying to publicize weekend premieres.
Global brands like Sprint and Verizon have been featured this week in the new homepage ad unit. Last week, Wendy’s created an interactive advertisement for its Baconator sandwich on the homepage. Today, the space is occupied by the upcoming comedy “Disaster Movie.”
“We believe there could be issues with the measurement that could be misrepresenting Yahoo and we are reviewing comScore’s methodology and working with them to resolve these issues,” Spokesman Adam Grossberg said in a statement.
comScore spokesman Andrew Lipsman countered that Yahoo’s month-on-month drop in display ad view was an “organic decline” unrelated to any changes in the firm’s measurement methods.
The site’s renovation is creating an tempting outlet for a new strata of advertisers, according to Pali Research’s Rich Greenfield, allowing MySpace to “reach far beyond the [social media] advertising category and to target far larger portal advertising budgets.”
MySpace now offers “a far more interactive, engaging method of reaching users,” Greenfield said in a statement. “There is so much more that you can do with it beyond the typical display ad on one of the big portals.” He said this was a negative omen for big portals like Yahoo as well as MSN and AOL.
Although it may perhaps be too early to say that MySpace has overtaken Yahoo for good, comScore data shows that Yahoo’s share of the display market has been trending down since July of 2007.