Why are social networks considered such a goldmine for advertisers? Because their users input nothing but personal data. However, finding the right tool to leverage social network data has proved
to be difficult. MySpace, the world's largest social network with 110 million active users, aims to take full advantage of its rich user data bank by implementing a new set of targeting tools for
advertisers.
This week, MySpace execs are expected to shed light on the results of a program testing the new behavioral targeting system, which increases the likelihood that a user will
click on an ad by 80%--effectively increasing its revenue per month from $40 million to $70 million, executives said. At a Merrill Lynch conference on Tuesday, Peter Levinsohn, president of Fox
Interactive Media, noted the "phenomenal" amount of data MySpace has, saying, "We have an opportunity to provide advertisers with a completely new paradigm."
Rival Facebook, of course, is also experimenting with new ad targeting tools, but less is known of the extent to which Facebook will leverage its user data. The first phase of MySpace's program will lump user interests into 10 primary categories: sports, fashion, finance, video games, autos and health. Phase two will see the addition of hundreds of sub categories. The algorithm makes associations by analyzing keywords in each user profile in addition to information like age, gender, location and past history. Every two weeks, MySpace workers will analyze the relevancy of the targeting program and tweak if necessary.