Major Marketers Avoid MySpace

by Erik Sass, Mar 21, 2006, 6:00 AM

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Social networking site MySpace has grown to 60 million members, adding 8 million to million new members in the last few months alone, and now accounts for around 12.5 percent of all online display ads.

But major brand marketers continue to shun the site. That's according to executives at a panel on the "Revolution in Television" hosted by the Advertising Research Foundation Monday in New York.

Of six panelists representing major advertisers and ad agencies, not a single one advertised with MySpace or other social networking sites. Reasons for avoiding MySpace include concern about its potential for criminal use, especially given recent well-publicized reports about sexual predators searching for victims on the site, as well as fears that user-generated content--including pictures and text with sexual overtones--will be offensive.

"I wouldn't be caught dead in that kind of environment," said David Cohen, executive vice president for Universal McCann Interactive, with a client roster including Microsoft, Johnson & Johnson, Lowe's Home Improvement, Wendy's International, and Sony Electronics. "You only have to look around for five or 10 minutes to find something offensive."

Dawn Hudson, president and CEO of Pepsi-Cola North America, echoed this sentiment, saying she was "interested" in sites like MySpace that feature user-generated content, but "we're being cautious because there's a blurring between advertising and content, and the content does rub off on your brand."

The other executives on the panel were Giovanni Fabris, vice president and international media director, McDonald's; Randy Falco, president and chief operating officer, NBC Universal Television Group; Paul Alexander, vice president of global advertising, Campbell's Soup Company; and Tony Pace, senior vice president and CMO, Subway Franchise Association.

Cohen added that sites like MySpace held some promise for advertisers, especially corporate-created pages. "There are areas where the content is generated by MySpace, and is totally sanitized and quite safe," he said, adding that he might consider recommending the site if marketers had the ability to pull ads when the surrounding content became too dicey.

And at a time when advertisers and media companies are looking for ways to fill the demand for content in myriad micro-niches, the panelists agreed that sites like MySpace have an indisputable advantage in attracting user-generated content. On this topic, after noting that "marketers are not investing time and money to build custom content for a video-on-demand platform, for example," Cohen observed there is nonetheless "very high-quality content submitted by consumers."

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