Advertisers Face Hurdles on Social Networking Sites.

From the NYT:

During the Fall Semester our SMMUCLA class has discussed the fact that social media is a set of online tools that enable community sharing, connectivity, and conversation among people. This NYT article points how the 'struggle' some advertisers are having trying to figure Social Media and how it really fits into their overall advertising strategy. This article talks about that.

It should be noted, however, that for all the missteps from some big advertisers and brands, others are going ahead with or without the advertiser's support and/or understanding to utilize social media. Are the advertisers becoming the late adopters? Your thoughts?

By RANDALL STROSS

Published: December 13, 2008

FOR some time, Procter & Gamble, the world’s largest advertiser, has been dipping its big toes into the vast pool of Facebook, now the world’s largest social network. I recently knocked on the doors of both companies to hear how the experiment was going. Neither was inclined to say much.

Independent experts on Web advertising have been watching, however, and what they see is a myriad of difficulties in making brand advertising work on social networking sites. Members of social networks want to spend time with friends, not brands.

When major brands place banner advertisements on the side of a member’s home page, they pay inexpensive prices, but the ads receive little attention. Seth Goldstein, co-founder of SocialMedia Networks, an online advertising company, wrote on his Facebook blog that a banner ad “is universally disregarded as irrelevant if it’s not ignored entirely.”

When advertisers invite members to come to pages dedicated to their products, they can attract visitors only by investing in expensive creative material or old-fashioned promotions like prize contests.

And when they try to take advantage of new “social advertising,” extending their commercial message to a member’s friends, their ads will be noticed, all right, but not necessarily favorably. Members are understandably reluctant to become shills. more here