Global Faces And Networked Places
March 2009
Global Faces and
Networked Places
A Nielsen report on
Social Networking’s
New Global Footprint
INSIDE:
Social networks/
blogs now 4th
most popular online
category – ahead of
personal e-mail
These sites account for
one in every 11 minutes online
Orkut in Brazil has the largest domestic
online reach (70%) of any social network
anywhere in the world
Facebook has the highest average time per visitor
amongst the 75 most popular brands online worldwide
Introduction
How social networks are creating
and advertisers to connect with their
a potentially transformational
audiences. So how do they need to
Report Highlights
change in consumer behaviour
change their strategies accordingly?
1. Putting the growth of social
Social Networking has been the global
Consumer engagement within social
networks – popularity and
consumer phenomenon of 2008.
networks has the potential to change
engagement – into context
Two-thirds of the world’s Internet
the way consumers are targeted, not
just through the digital medium, but
2. How the audience to social
population1 visit a social network or
through all forms of traditional media.
networks is changing
blogging site and the sector now
accounts for almost 10% of all internet
Whilst a few billion dollars of ad revenue
3. The challenges facing
time. ‘Member Communities’
can’t be wrong, the prevailing wisdom is
2 has
advertisers on social networks
overtaken personal Email to become the
that the current level of advertising
activity on social networks isn’t
4. What advertisers can do to
world’s fourth most popular online
consummate with the size – and highly
find the magic formula for
sector after search, portals and PC
engaged levels – of the audience. The
advertising in social networks
software applications.
social networks and advertising industry
5. Factors contributing to the
The story is consistent across the world,
haven’t quite yet found that magic
Facebook phenomenon
‘Member Communities’ has taken a
formula to make this happen.
foothold in every major market from
6. Why localisation has won the
50% of the online population in Switzerland
The industry is faced with a real ‘Catch-22’
day in many countries
and Germany to 80% in Brazil. Facebook
situation. Part of Facebook’s extraordinary
subscriber growth is due to a clean
7. Where mobile social networking
has become the largest player on the
design with little advertising clutter;
has taken the greatest hold
global stage, dominant in many countries,
yet localised offerings have won the day
consequently, the audience growth
8. What ‘traditional’ publishers
in many others.
hasn’t been accompanied by a similar
can do in the face of the social
surge in advertising revenue. On the
network phenomenon
However, the growth in popularity of
other hand, MySpace’s more customisable
social networks – and the resultant
entertainment and content-oriented
broadening audience – is only half the
offering – carrying more advertising –
story. The staggering increase in the
has been more successful at attracting
amount of time people are spending on
advertising revenue, yet MySpace’s
these sites is changing the way people
audience is flattening. The industry will
spend their time online and has
be watching very closely at which one of
ramifications for how people behave,
these fundamental differences in strategy
share and interact within their normal
will prove the most successful in
daily lives.
attracting advertising revenue in 2009.
Consequently, the global media and
This report puts the global social
advertising industries are faced with new
network phenomenon during 2008 into
challenges around the opportunities and
context, providing insights and lessons
risks this new consumer medium
for the networks themselves, advertisers
creates. Social networks provide
and the media industry on how to take
competition to traditional publishers for
advantage of what’s happening online
consumer attention and at the same
around “Global Faces and Networked
time, facilitate new ways for publishers
Places”.
1 In this report, the terms ‘Global’ or ‘World’ encompass the following countries in which Nielsen Online
has a NetView panel – USA, Brazil, United Kingdom, France, Germany, Italy, Spain, Switzerland and
Australia. (Whilst Japan figures are shown in certain graphs, Japanese data isn’t included in any global
figures.)
2 Nielsen Online’s ‘Member Community’ category includes both social networking and blogging websites.
1
Copyright © 2009 The Nielsen Company
Social network and blogging sites
Figure 1: Member Community growth twice that of any of the other fi ve
are now the fourth most popular
most popular sectors
activity on the Internet
Global1 Global1
% Point
‘Member Communities’ now reach over
Active
Active
Increase in
Rank Sector
5 percentage points more of the Internet
Reach
Reach
Active
population than it did a year ago – a
Dec 08
Dec 07
Reach
growth rate more than twice that of any
1
Search
85.9%
84.0%
1.9%
of the other four largest sectors.
2
General Interest Portals & Communities
85.2%
83.4%
1.9%
The strongest growth has come in
3
Software Manufacturers
73.4%
72.0%
1.4%
Germany where the sector now reaches
51% of Germans online compared to
4
Member Communities
66.8%
61.4%
5.4%
39% a year ago – an actual increase of
5
E-mail
65.1%
62.5%
2.7%
over 12 percentage points.
Source: Nielsen Online, Global Index, December 2007 – December 2008. E.g. In Dec 08 the Search sector
reached 1.9% (points) more of the world’s online population than it did in Dec 07
Large growth has also occurred in the
1 ‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only
UK, Spain, Italy and Switzerland – the
sector reaching 10% percentage points
Figure 2: Germany has seen the greatest increase in online reach of
more of the online population in each of
Member Community websites
these countries than it did a year ago.
80%
1.4%
75%
73%
Dec-08
70%
69%
Dec-07
Germany arrives later to the
67%
9.9%
67%
67%
9.9%
2.7%
2.6%
2.9%
social network party
5.4%
10.3%
59%
4.9%
Natural German reserve when it comes
51%
51%
to disclosing personal data resulted in
12.5%
9.6%
social networking taking off later than in
78%
78%
most other countries. As in many
67%
65%
63%
countries, younger people were the fi rst
61%
59%
64%
64%
55%
in Germany to embrace social networks.
However, the activity is starting to
39%
41%
spread to the wider online population
due to sites like “Wer-kennt-wen”,
literal y translated as “Who Knows
Whom.” Including neighbourhood
e
UK
y*
communities and job-related networks,
Italy
USA
alia
1 Global
Brazil*
Spain
Japan
Franc
erland*
Austr
“W-k-w” addresses a more mainstream
German Switz
audience than previous dominant players
such as StudiVZ, which targets students.
Source: Nielsen Online, NetView, Home and Work Data, December 2007 – December 2008 (*Home only). E.g. In
Dec 08 ‘Member Communities’ reached 67% of the global online population compared to 61% in Dec 07
1
Takeovers by big traditional media
‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only (JP fi gure not included in Global fi gure)
companies – bringing signifi cant
investment and management
experience – have also helped bring
Facebook has started to make a bigger
as local players already had a signifi cant
social networking to a wider audience.
impression since launching a German
head start. In fact, StudiVZ, started in
Publisher Holtzbrinck bought StudiVZ
language interface in March 2008 – the last
2006, was so similar to Facebook that
(within eight months its audience grew
six months of 2008 saw the site triple its
Facebook sued it in a Californian court in
by 168%) and after TV network RTL, a
audience to over 2.4 million Unique Visitors.
2008, alleging that StudiVZ copied its look,
subsidiary of media giant Bertelsmann,
feel, features and services. StudiVZ denied
bought “W-k-w”, its reach tripled
However, Facebook is still only the sixth
the claims.
within a year.
most popular social network in Germany
2
Copyright © 2009 The Nielsen Company
Time spent on social network and
Figure 3: The total amount of time spent on Facebook increased by 566%
blogging sites growing at over 3x
the rate of overall Internet growth
Change in total minutes between Dec 07 and Dec 08
This increase in popularity is only half
the story when it comes to the social
All
Internet
18%
networking phenomenon – the time
people spend on these networks is also
increasing dramatically.
Member
Communities
63%
The total amount spent online globally
increased by 18% between December
2007 and December 2008. In the same
Facebook
566%
period, however, the amount of time
spent on ‘Member Community’ sites
rose by 63% to 45 billion minutes; and
Source: Nielsen Online, Global Index, December 2007 – December 2008
1
on Facebook by a massive 566% – from
‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only
3.1 bil ion minutes to 20.5 bil ion. Facebook’s
time is so high due to being the ninth
Figure 4: Switzerland has seen the greatest increase in share of time
most popular brand online and having
accounted for by Member Community websites
the highest average time per person
(three hours 10 minutes) amongst the
Member Community Member Community Relative Change
Country
75 most popular brands online worldwide.
Share of Time Dec-07 Share of Time Dec-08
in % Share
Global1
6.7%
9.3%
38%
Switzerland*
3.0%
9.3%
207%
Germany*
3.1%
7.5%
140%
UK
8.0%
17.4%
118%
Consequently, social networks and
Italy
7.2%
15.4%
113%
blogs are eating into the share of
time held by other sectors
Spain
6.7%
12.5%
87%
France
4.0%
6.3%
59%
Because time spent on social networks is
growing at a dramatically faster rate
Australia
6.9%
10.9%
58%
than the Internet average, social
USA
5.8%
6.4%
11%
networks are gaining a larger share of all
Internet time. In most of the countries
Brazil*
24.4%
23.1%
-6%
monitored the share of time accounted
Source: Nielsen Online, NetView, Home and Work Data, December 2007 – December 2008 (*Home only)
for by ‘Member Communities’ has more
E.g. Between Dec 07 and Dec 08 the share of time accounted for by ‘Member Communities’ globally increased
than doubled. In Switzerland, for
from 6.7% to 9.3% - a relative increase of 38%
1
example, the share of time has tripled
‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only
from 3% to 9.3%.
A year ago ‘Member Communities’
Like social networking, the Video and
As the online industry matures and the
accounted for one in every 15 online
Online Games sectors have also seen
value of online real-estate is increasingly
minutes globally – now it accounts for
strong increases in share of time and it
measured by time spent, rather than
one in every 11. In Brazil alone, ‘Member
seems that the biggest casualty of these
pages viewed, a significant shift in
Communities’ accounts for almost one
increases has been Instant Messaging –
advertising revenue from ‘traditional’
in every four minutes. In the UK they
another ‘communications’ sector that
online media towards social media could
now account for one in every six minutes
has struggled to attract ad revenues
be realised – if the successful ad model
(up from every 13 minutes a year ago)
consistent with the level of online time it can be found.
and in Italy one in every seven (up from
accounts for.
one in 14 a year ago).
3
Copyright © 2009 The Nielsen Company
The social network audience is
Figure 5: Facebook’s greatest growth in global1 audience numbers has
becoming more encompassing
come from people aged 35-49
As an entity moves from being niche to a
14
major player the composition, or
make-up, of its audience changes. Social
12
12.4
Male
Female
11.9
11.7
networks online started out amongst
10.9
the younger audience. However, as the
10
networks have become more mainstream
with the passage of time, it isn’t surprising
8
7.6
to see the audience becoming broader
Audience (millions)
and older. This shift has primarily been
6
6.0
driven by Facebook, whose successful
Unique
3.7
formula (page 9) opened up the
4
3.6
ease in
possibilities of social networking to a
Incr
1.9
2
much wider audience.
1.3
In terms of sheer audience numbers, for
0
2 - 17
18 - 34
35 - 49
50 - 64
65+
example, the greatest growth for
Facebook has come from people aged
Source: Nielsen Online, Global Index, December 2007 – December 2008. E.g. Between Dec 07 and Dec 08 there
35-49 years of age (+24.1 million).
was a 3.7 million global increase in the number of 2-17 year old males visiting Facebook
Furthermore, Facebook has added
1 ‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only
almost twice as many 50-64 year olds
visitors (+13.6 million) than it has added
Figure 6: The audience composition of Member Community websites is
under 18 year old visitors (+7.3 million).
shifting from the young to the old
Consequently, people under 18 years old
8%
are making up less of the social network
7%
and blogging audience, whereas the 50+ age
6%
4%
group are accounting for more of the
4%
audience.
2%
C
omposition 2%
0%
Audience -2%
-1%
Unique -4%
-6%
Change in -8%
-9%
-10%
2-17
18-34
35-49
50-64
65+
Source: Nielsen Online, Custom Analytics, December 2007 – December 2008. E.g. Between Dec 07 and Dec 08,
the share of the online global1 audience to ‘Member Community’ sites accounted for by 2-17 year olds decreased
relatively by 9%
1 ‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only
Facebook started out as a service for university students but now almost one third of
its global audience is aged 35-49 years of age and almost one quarter is over 50 years
old. In the UK, for example, if the average month-on-month audience changes over
the last six months were to continue; by mid-June 2009 there would be as many
35-49 year olds on Facebook as 18-34 year olds.
The changing audience offers advertisers the opportunity to use social networks as
a vehicle for targeting all demographic groups. In Italy, brands such as Maserati –
traditionally marketed to an older audience – now have fan pages on Facebook.
4
Copyright © 2009 The Nielsen Company
Challenges facing advertisers on
social networks
To realise this opportunity to use social
are less inclined to accept advertising
A Nielsen Online survey in Australia
networks as a vehicle for targeting all
around it. A well used analogy is that
showed that the challenge could be
demographic groups, challenges have to
advertising on a social network is like
getting more difficult because consumers
be overcome. The current level of
gate-crashing a party.
are actually growing less tolerant to
advertising activity on social networks
This is compounded by the fact the
advertising on social media. The study
isn’t consummate with the size – and
content supplied by the social network
showed that in December 2008, 38% of
highly engaged levels – of the audience.
members is also of a highly personal
Australians online considered advertising
A key reason why advertising on social
nature. This provides another “Catch-22”
on social networking sites to be an
networks hasn’t been as successful as on
situation for the social networks in that
intrusion compared to 29% the year
the more ‘traditional’ publishers is
personal data is potentially one of their
before. Furthermore, those who didn’t
because social networkers serve a dual
most valuable assets – highly attractive
mind being served ads if they were
role as both the suppliers and consumers
to advertisers – yet it provides a major
relevant to their interests dropped
of content. In the traditional model they
obstacle in generating revenue. As the
slightly from 51% to 47%.
simply consume the content supplied by
site becomes more attractive to advertisers
the publisher. Therefore, members have
it becomes less appealing to members
a greater sense of ‘ownership’ around
who see highly-targeted ads as invading
the personal content they provide and
privacy.
Nielsen Social Media Resources
Nielsen Online has a number of social media resources to help you make sense of and
keep you updated with what’s happening in the social media space and all areas of the
online industry:
Analyst Blog
http://www.nielsen-online.com/blog
http://blog.nielsen.com/nielsenwire/
“Connecting the Dots” is a resource for research, insights and commentary on the digital
world – including consumer behaviour, industry trends and breaking news – all grounded
in world-class data and our deep experience with the world’s top brands. Join us in
connecting the dots with your comments and feedback.
BlogPulse
http://www.blogpulse.com/
BlogPulse is a blog search engine that analyzes and reports on daily activity in the
blogosphere. An automated trend discovery system for blogs, it applies machine-learn-
ing and natural- language processing techniques to discover trends in the highly dynamic
world of blogs.
Twitter
http://twitter.com/pblackshaw - Pete Blackshaw, EVP, Digital Strategic Services
http://twitter.com/NetNuggets - Alex Burmaster, Communications Director, UK & EMEA
http://twitter.com/nielsencompany - The Nielsen Company
Micro-blogging on data, insights, ideas, lessons and trends across the global digital universe.
S.M.A.R.T.
http://www.nielsensmart.com/
The Social Media and Advocacy Roundtable is an exclusive forum for Nielsen clients and
analysts to discuss digital best practices.
5
Copyright © 2009 The Nielsen Company
What can advertisers and their
the fore as the ultimate form of advertising the more successful examples of social
agencies do?
at a time when traditional advertising is
network marketing that touch on the
suffering from a major lack of trust.
principles of interactivity and adding
Work with the networks more closely
Nielsen’s analysis of social media
value – such as offers, sneak previews
The social networks and advertisers have conversations back in 2007 and again in
and co-creation of content.
compatible interests. The networks need
December 2008 showed that ‘false’ was
Social networks lend themselves greatly
advertisers to monetise their audience
the term most closely associated with
to generating brand affinity for advertisers
effectively. Advertisers need the networks “advertising”.
through these fan sites, which, in
as they have to go where consumers are
Social media has fanned the flames of
essence, act as advertising. For example,
spending more of their time. Both parties consumer distrust about advertisers
at the time of writing, Facebook’s
will reap significant rewards if they can
claims. However, at the same time social “Addicted to Starbucks” group has
discover the magic recipe for advertising
media has provided the motive, opportunity almost 124,000 members, over 670
successfully on social networks – but
and means for advertisers to engage
discussion topics and almost 10,000 wall
they will need to work together to
consumers in a more open and honest way.
posts. However, the chal enge for
develop it.
Advertising should be about adding value
advertisers is that discussions within these
New approaches to the ad model are
groups won’t necessarily align itself with
required for this challenging and
Social networks are ultimately about
the brand-designed messaging. Much
complex arena
friendships, where members add value to like a friendship, marketing on social
each other’s lives through interaction.
It will take time to work out the magic
networks requires continual investment
Therefore, advertising should follow the
formula for successfully advertising in
– in terms of time and effort as opposed
same philosophy of adding value through
social networks. The diversity and
to financial – to be of value to both
interaction and consultation. Fan sites or
personalised nature of the environment
parties.
sponsored groups are, perhaps, one of
means standard ad models – such as
contextual search and standard unit sizes
– won’t cut it. Different approaches
across ad units and ad inventory will
Figure 7: ‘False’ is the term most closely associated with advertising
have to be tried, involving a trial and
error mindset. As mentioned above, a
Advertising
closer relationship between the social
Price
Deal
campaign
networks and advertisers is required to
Costs
Quality
negative associations
Customers
Market
make this happen.
Buy
stakeholders
Products
See
Consumers
Sales
Quote
platforms
Online
Advertising must be a conversation
Product
People
Website
rather than a push model
Business
The point that social network members
Internet
are co-creators of content and, therefore,
Agency
Marketing
have a sense of ownership within the site
Free advertising
Advertising campaign
means advertising should be about
False advertising
ADVERTISING
participating in a relevant conversation
Advertising revenue
Promote
False
TV advertising
Advertising company
with consumers rather than simply
Buy One Get One Free
Media
Misleading
Sell advertising
pushing ads on them. After all, it is social
Ads
Commercial advertising
Cost of advertising
Advertised price
media. Advertising shouldn’t be about
Television
Adverts
Commercial
interrupting or invading the social
Channels
Adwords
network experience, it should be part of
this conversation.
Billboards
Broadcasters
Newspapers
Magazines
The tone of advertising must be more
authentic
Messaging within advertising should
come from a more authentic, candid and
Source: Nielsen Online, BuzzMetrics, September 2008 – December 2008. E.g. in English-language online social
humble perspective. Social media has,
media conversations ‘false’ is the term most closely associated with advertising
once again, brought word of mouth to
6
Copyright © 2009 The Nielsen Company
Generating ad revenue – the MySpace story
Although Facebook has come some
Figure 8: MySpace and Bebo attract more advertising activity in the
way towards delivering a promise of
UK than Facebook despite having a smaller audience
targeted ads within a mass network,
MySpace’s more focused overall
offering seems to be proving more
Facebook
MySpace
Bebo
fruitful at the moment.
MySpace is smaller globally than
2,036
Facebook and, outside the US, is
considered more of a niche player
1,592
because of its more focused targeting
1,246
towards teenagers and young adults
982
through the vehicles of entertainment
799
– encompassing music and video –
639
530
467
and self-expression (decoration
451
options allow profi le pages to be
highly customisable).
Average Monthly
No. of Advertisers
No. of Campaigns
Reports estimate that in 2008
Audience (10,000s)
Facebook earned around $US300
million in ad revenue compared to
Source: Nielsen Online, AdRelevance and NetView, UK, 2008.
around $US1 billion for MySpace. If
E.g. Facebook averaged 12.46 million Unique UK Visitors per month in 2008 and during the year had 451
Facebook has made a conscious choice advertisers who ran a total of 982 display ad campaigns
to go for the quantity vs. quality
strategy it has yet to overtake MySpace
in the all-important revenue metric.
Facebook’s (12.5 million) yet managed to Figure 9: Mobile network
Whilst part of Facebook’s huge appeal attract almost one and a half times as
operators were the most active
is the simple layout of an interface
many advertisers (639 to Facebook’s
display advertisers on MySpace
that carries very little ad inventory,
451). At an arbitrary base level, Facebook UK in 2008
MySpace’s offering possibly makes its
attracted 0.36 display advertisers per
inventory – of which there is a lot
Unique Visitor, Bebo attracted 1.37 and
MySpace UK
No. of
Rank
more compared to Facebook – easier
MySpace attracted 1.51 advertisers per
Advertisers
Campaigns
to monetize, particularly in terms of
Unique Visitor.
1
T-Mobile
46
immersive advertising. Bebo, also
MySpace has also benefi ted from its
carrying more inventory than Face-
2
O2
42
acquisition by News Corp and being
book, has also done well in this regard assimilated into the Fox Interactive
3
Vodafone
42
by targeting teenagers and young
Media stable – together with sites like
adults through music and celebrity.
4
PC World
40
Photobucket, IGN, Rotten Tomatoes and
Facebook is more focused on the
AskMen – which has provided MySpace
5
Orange
29
“traditional” social networking
with one of the most mature and
6
Lastminute.com
27
component of communications, while successful display ad models within the
sites like MySpace and Bebo are more
social network space today.
7
Sky
26
focused on the entertainment content In the UK, mobile network operators –
8
Virgin Media
22
component. From an advertising
such as T-Mobile, O2 and Vodafone – and
9
Pogo
20
perspective, it has been a moot point
media companies such as Sky and Virgin
that monetizing content is easier than – dominate the most active advertisers
10
Halifax
16
monetizing communications, which
on MySpace. Personal communications
Source: Nielsen Online, AdRelevance, UK, 2008.
gives sites like MySpace and Bebo an
and entertainment are extremely
E.g. T-Mobile ran 46 different display ad
advantage For example, in the UK
relevant for sites such as MySpace whose campaigns on MySpace UK during 2008
across 2008, Bebo’s average monthly
audience is ultimately there to
Unique Audience (4.7 million) was
communicate and interact with friends
almost one-third the size of
in an entertaining and personalised way.
7
Copyright © 2009 The Nielsen Company
Facebook has replaced MySpace
Figure 10: Facebook and LinkedIn have experienced large relative
as the world’s most popular social increases in global1 online reach
network
Global1
Relative
Active
Active
The global rise of social networks in
Unique
Change in
Rank Social Network
Reach
Reach
2008 has primarily been driven by
Audience
Active
Dec 08
Dec 07
Facebook, which overtook MySpace to
(millions)
Reach
become the world’s most popular social
1
Facebook
108.3
29.9%
11.1%
168%
network.
2
MySpace
81.0
22.4%
23.0%
-3%
Less than four years after Harvard
3
Classmates Online
19.7
5.5%
3.9%
40%
student Mark Zuckerberg founded
Facebook in February 2004, its rapidly
4
Orkut
17.5
4.9%
4.6%
7%
soaring popularity saw it included in the
5
LinkedIn
15.0
4.2%
1.8%
137%
2008 edition of the Collins English
Dictionary (as a noun and a verb).
Source: Nielsen Online, Global Index, December 2007 - December 2008.
E.g. In Dec 08, 108.3 million people (30% of the world’s Internet population) visited Facebook. Facebook’s
Facebook is now visited by three in every online active reach has increased, relatively, by 168%, from 11.1% to 29.9%
ten people online across the world.
1 ‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only
It has been a mixed year for the leading
players in terms of their global footprint.
Figure 11a: The most popular social networks in countries where
Facebook (168% relative increase) and
Facebook is the leader
LinkedIn (137%) have seen huge
Rank Australia
Spain
Switzerland* France
UK
Italy
increases in reach. Classmates Online
has also seen strong growth, whilst
1
Facebook
Facebook
Facebook
Facebook
Facebook
Facebook
Orkut and MySpace‘s reach has stayed
fairly consistent.
2
MySpace
Tuenti
Netlog
L’Internaute
Copainsdavant MySpace
MySpace
3
Bebo
MySpace
MySpace
MySpace
Bebo
Netlog
Is the Italian Government the
only thing stopping Facebook?
The issue of low productivity in the
Figure 11b: The most popular social networks in countries where
Italian workforce has been taken on
Facebook isn’t the leader
by the Minister for Public Adminis-
Rank Brazil*
China
Germany*
Japan
USA
tration. Last year Renato Brunetta,
declared war on the “fannulloni” –
1
Orkut
51
Wer-kennt-wen Mixi
MySpace
sluggards – of the Italian public
sector workforce, achieving a near
50% drop in the number of sick
2
Sonico
Xiaonei
StudiVZ
Lococom
Facebook
days within a few months. Facebook
is also a target and Italian companies,
3
MySpace
Chinaren
MySpace
Kanshin-kukan Classmates
both public and private, are
Online
blocking access to the site – Poste
Source: Nielsen Online, NetView, Home and Work Data, December 2008 (*Home only).
Italiane (the Italian mail service)
E.g. Orkut is the most popular social network in Brazil.
being the first to do so in November
2008. However, there are
( = domestic social network)
compromises – employees within
the Naples municipality are allowed
an hour per day on Facebook.
8
Copyright © 2009 The Nielsen Company
Why Facebook has become the
Figure 12: Facebook has the greatest online reach in the UK and Italy
world’s most popular social network
( = Facebook not the most popular social network in that country)
Based on a simple design, broad
demographic appeal and a focus on
connecting, Facebook has become the
47%
most popular social network in the
44%
majority of countries measured by
Nielsen Online. It has the greatest reach
38%
in the UK, being visited by 47% of
33%
Britons online, and actually has a greater
30%
29%
28%
online reach in both Italy (44%) and
27%
Australia (38%) than it does in its
country of origin - the USA (33%).
Overcoming privacy issues
6%
quickly
2%
0.5%
Occasionally it seemed the only thing
e
UK
y*
alia
Italy
USA
that could stop Facebook’s meteoric rise
azil*
1
Spain
Global
Franc
Br
Japan
erland*
Austr
was how it dealt with its members’ data.
German
Switz
Facebook’s u-turn in February 2009 on
retaining users’ content and licenses
after they terminated their account
Source: Nielsen Online, NetView, Home and Work Data, December 2008 (*Home only).
E.g. 30% of the world’s online population visited Facebook in Dec 08
came after protests from members and
1 ‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only (JP fi gure not included in Global fi gure)
uproar in the blogosphere.
Facebook also incurred the wrath of its
Factors contributing to Facebook’s
Architecture. Inventive features (including
members over the Beacon advertising
rapid growth
applications, invites, requests) and open
system that sent information about
architecture - including the masterstroke
members shopping habits and activities
Design. An organized, simple and
to open the platform to applications
on other websites to Facebook – mainly
easy-to-use interface – with much less
developers – have increased word-of-
to al ow targeted ads to be served on
advertising compared to many of its
mouth and visitor engagement.
Facebook. This caught many members
competitors – is likely to appeal to a
Privacy. Members have more control
off guard and, after initially defending
wider audience.
over who sees their content than in
the system, Facebook backed down to
Broad appeal. Facebook isn’t targeted
many other networks where non-
allow members to opt out of it.
towards a specifi c demographic like many
members can access personal content –
In September 2006 the “News Feed”
other players (e.g. StudiVZ to students or
a concern for many people.
feature that allowed members to track
Bebo to young adults) – ironic considering Media coverage. Facebook’s early
their friends’ Facebook movements was
that it started out as a network for
momentum was given a huge boost due
greeted by protests that numbered in
university students.
to the large amount of free media
the hundreds of thousands of people
Activity Focus. Facebook is focused on
coverage it received.
within a day. Within 48 hours of the
connecting as opposed to entertainment.
rol -out Zuckerberg had openly stated
It can be used for multiple networking
the site had “messed up” and improved
activities – reuniting old friends, business
the privacy controls.
networking, dating, sharing photos,
Facebook has now given members
status updates. Facebook is Reunion,
comment and voting rights over
LinkedIn, Yahoo! Personals, Flickr and
Facebook’s future policies on how the
Twitter all in one.
site is governed.
9
Copyright © 2009 The Nielsen Company
First-mover advantage and
Figure 13: Music is a major difference in discussions around Facebook
language have kept Facebook at
and MySpace
bay in some countries
30%
Facebook
MySpace
Although five years old, Facebook only
27%
came to global prominence in the last
two years, allowing time for other social
25%
networks to take a strong hold. Creating
22%
a local infrastructure on the ground to
20%
20%
establish a relevant local offering
17% 17%
tailored to the nuances of the domestic
market has been enough to keep
the network 15%
14%
Facebook at bay in some countries. In
12%
Germany, for example, local player
10%
Wer-kennt-wen is twice as popular as
online social media posts
10%
9%
mentioning
8%
of
Facebook. In Japan, Mixi is around 27
7%
%
6%
times more popular than Facebook and,
5%
5%
in Brazil, Orkut is 29 times more popular.
2%
Brazil: the Orkut phenomenon
0%
Named after its creator, Google
Friends
Profile
Photos
Music
Problems
Video Application
employee Orkut Büyükkökten, Orkut
appeared in 2004 and students in major
Source: Nielsen Online, BuzzMetrics, December 2008.
Brazilian cities started to distribute
E.g. In Dec 08, 22% of English-language online social media posts citing Facebook mentioned friends
invitations for fun to see if they could
make Orkut more popular in Brazil than
its native USA – something they
USA: MySpace’s mass-market appeal
Its music offering, MySpace Music, is a
succeeded in doing. Orkut is the most
MySpace had already gained a
key differentiator and remains a huge
popular social network in Brazil but also
significant following in the US by the
draw in the US, being used by almost
the country’s third most popular site.
time Facebook appeared on the scene.
every major music act in the country
Half of the Brazilian Internet population
Furthermore, Facebook earned an early
which keeps the content fresh and
visited Orkut in September 2005 and
reputation as an exclusive service due to
people coming back. Music’s importance
the figure is now 70% – the largest
its birth within the elite northeast
for MySpace versus Facebook is shown
domestic reach of any social network
college sector. This stalled growth within
though an analysis of social media
anywhere in the world.
the mainstream US market that
conversations - music is the biggest
difference between topics discussed. It’s
Facebook barely registers a blip in Brazil
MySpace appealed to. The US perception
mentioned in 20% of posts about
compared to Orkut – being visited by
of Facebook and MySpace is a reversal of
MySpace compared to just 7% in posts
just over 2% of Brazilians online. It’s not
the situation internationally, where
about Facebook.
inconceivable that if Facebook had
Facebook is perceived as mainstream
started a few months later, Brazilian
and MySpace as being more focused
This has, so far, managed to keep
students would have taken it on as their
around a younger demographic through
MySpace ahead. However, at current
pet project and Facebook would have
entertainment and self expression.
audience growth rates, Facebook (145%
been the ‘Orkut of Brazil.’ Facebook only
MySpace had established itself as an
growth from December 2007 – December
launched a Portuguese version for
entertainment portal rather than just a
2008) is set to overtake MySpace (3%
Brazilians in December 2008.
pure social network.
growth) in January 2009.
10
Copyright © 2009 The Nielsen Company
China: a different culture
A host of established domestic social
networking players added to the
Figure 14: China’s most popular social networks
different culture, language and the
regulatory issues of doing business in
Average Weekly Unique Browsers in
Rank
Social Network
China are the main reasons why the US
December 2008
social networks aren’t dominant here. By
1
51.com
14.0
the time the US networks arrived, local
players such as Xiaonei; the portal QQ
2
xiaonei.com
9.5
and 51.com had achieved dominance in
3
chinaren.com
7.0
key demographic groups. Although many
4
kaixin001.com
3.5
of the domestic social networks are very
much based on the US offerings, their
5
myspace.cn
2.0
success was originally based on having
6
5460.net
1.0
partnerships with the portals which
provided them with an audience base.
7
wangyou.com
1.0
Succeeding in China takes more than
8
ipart.cn
1.0
producing a translated version; it requires
9
360quan.com
0.9
investment in a local infrastructure and a
mentality of running a Chinese social
10
cyworld.com.cn
0.8
network that understands the domestic
Source: CR-Nielsen China, NetRatings, December 2008. E.g. In Dec 08, 51.com was visited by
nuances of social network behaviour
an average of 14.0 million Unique Chinese Browsers each week
rather than simply rolling out a generic
social network in Chinese.
Japan: the language barrier
A localised offering is essential to
Whilst Facebook has a good following
Furthermore, networks have to be
cracking the Japanese market and getting amongst Japan’s international community adapted for the enormous domestic
anywhere near the utter dominance of
and its strength in privacy will appeal to
mobile Internet market. Part of Mixi’s
Mixi. Facebook only launched its
the native Japanese way – Mixi is an
dominance is down to the clever
Japanese language version in May 2008
invite only system – previous US companies
integration of its mobile and PC offering
and did so without any major form of
have fallen short because of a lack of local – its mobile version was launched in
investment in the country – it didn’t set
leadership and a ‘humble’ mindset that
September 2004 and offers virtually
up a local office and the translated
acknowledges being big in the US doesn’t identical functionality to the PC
version was done by volunteer members.
automatically mean being big in Japan.
interface.
11
Copyright © 2009 The Nielsen Company
Mobile Social Networking is
Figure 15: Social networks have the greatest mobile web reach in the UK
Taking Off
and US
As Mixi in Japan shows, the increasing
popularity of social networks has
Unique Mobile Internet Audience (000s) Q4 2008
resulted in increasing demand to access
them on the move. Mobile is a natural fit
1,961
for social networks, as consumers are
used to connecting with friends via
10,618
mobile calls and text. Using the phone
to access social networks doesn’t require
much change in consumer mindset.
Subscribers access social networks on
their mobile through three primary
773
means: by browsing over mobile Web,
22.7%
865
401
through downloaded applications and
19.2%
by SMS (text-messaging).
485
UK mobile web users have the greatest
12.3%
propensity to visit a social network
10.6%
10.6%
through their handset with 23% of them
6.6%
(2 million people) doing so, compared to
19% in the US (10.6 million people). The
numbers of people doing so are a big
UK
US
France
Italy
Spain
Germany
increase on last year – 249% in the UK
and 156% in the US.
Source: Nielsen Online, Mobile Media View, Q4 2008. E.g. 23% of UK Mobile Web users (1.96 million people)
The most popular social networks via
visited a social network through their mobile phone in Q4 08
PCs/laptops tend to be the most popular
via mobile too. Facebook is the most
popular in five of the six countries where
Nielsen measures mobile activity – only
Xing in Germany bucks this trend.
Mobile applications for handsets such as
Apple’s iPhone are playing a substantial
role in the expanded mobile use of these
networks. Soon after the launch of the
3G iPhone, Facebook, with one of the
most popular iPhone applications
available, surpassed MySpace in mobile
usage in the U.S.
SMS (text message) is the third way
users can interact with their social
networks on the go. Primarily used for
“status updates,” users can register a
phone to send text message posts
directly to their user profile. By the end
of 2008, Nielsen estimated that almost
3 million U.S. mobile users were texting
Facebook on a regular basis.
12
Copyright © 2009 The Nielsen Company
What can publishers do?
Understand that social networks are an
Instant Messaging has been a casualty of These early trends potentially indicate
opportunity for everyone
social networking in terms of a falling
that online usage is complementing, not
Social networks are a communication
share of online time yet Windows Live
substituting, traditional television
channel just like TV, newspapers, radio
Messenger, for example, has almost one
viewing. Social networks and TV,
and the telephone. Therefore, social
million Facebook fans - around which a
therefore, might be a mutually reinforcing
networks are just another vehicle by
whole community of discussions take
media as the level of twittering (updates
which any company with an offering,
place. It’s quite feasible that the falling
sent through the micro-blogging service
product or service can use to communicate,
share of time for IM could be more
Twitter) during the recent Oscars proved.
engage and connect with consumers.
pronounced without this form of
participatory advertising in social
Whatever the successful ad model turns
Tap into what makes social networks
networks.
out to be in social networks – copy it
successful
Success in social media advertising
Think about the mutual relationship
Publishers have the opportunity to
means overcoming obstacles such as
with social networks and other media
actively participate in the social media
complexity, creativity and relevance.
revolution. The growth of social media
A Nielsen study published in October
Therefore, whatever the successful
and consumers’ willingness to generate
2008 showed that almost one-third of
formula turns out to be in terms of new
opinion and co-create content is a big
home Internet use (31%) in the US is
ad formats and a different approach to
opportunity for traditional publishers to
accompanied by background TV viewing.
ad inventory, the ingredients could form
increase audience and engagement on
Furthermore, more than 80% of
the ‘best practice’ for advertising across
their own sites.
Americans who watched TV and used the all sectors – improving the success of
Internet in September 2008 used both
online advertising everywhere.
‘Internal’ - Increase interactivity within
simultaneously. Although teenagers were
the publisher site
the most likely to use both together,
adults aged 35 to 54 actually logged the
Publishers should instigate functionality
most simultaneous Internet/TV usage
that enables communities and conversations minutes.
to form within their own sites. This
doesn’t mean creating a social network
infrastructure but can be as straightforward
News publishers Twitter followings
as allowing visitors to comment or
Increasing numbers of news publishers – also seen as a casualty of growth in online media
create content related to material
- have adapted from simply having websites to participating in social media through active
posted by the publisher. This enables
use of sites like Twitter to drive awareness and conversation around their brands and
traditional publishers to become part of
offerings. CNN and the New York Times have some of the largest followings on Twitter.
the wider consumer conversation rather
than just pushing content and sitting back.
Figure 16: News publishers have considerable Twitter followings
(and counting...)
‘External’ – Participate in the conversation
on social network sites
Publisher
Username
Number of followers
Just as consumers add content to social
CNN Breaking News
cnnbrk
323,258
network sites, so can publishers. Social
networks offer the opportunity to
The New York Times
nytimes
208,032
promote content to a wider audience
BBC Click
BBCClick
140,941
across the web. Traditional publishers are
amongst the most popular fan pages on
Guardian Tech
guardiantech
116,845
Facebook, some having hundreds of
Source: Twitterholic, 27th February 2009
thousands of fans.
13
Copyright © 2009 The Nielsen Company
Conclusion: Social Networks provide the trigger to improve the potency of advertising across all forms of media
The social networking phenomenon is
The Industry faces a huge predicament.
This will involve a substantial trial and
dramatically changing the way people
The factors behind Facebook’s stunning
error process and is only achievable if the
behave and, consequently, offers new
growth – a focus on connecting through a
social networks, advertisers and their
challenges and opportunities to the
simple and relatively advert-free design –
agencies work more closely together.
global media and advertising industry
haven’t attracted ad revenues consummate Whatever the successful ad model turns
alike. Social network and blogging sites
with the size and engagement levels of its
out to be, the messaging will have to be
now account for almost 10% of all
audience. On the other hand, MySpace’s
authentic and humble, and built on the
Internet time yet remains, with a few
audience is flattening but its ad model –
principle of a two-way conversation –
exceptions, a largely un-monetised form
built around a richer content offering,
not a push model – that adds value to
of media. The industry is still in its
more in line with traditional online
the consumer.
infancy in regards to successfully
publishing – is doing better at attracting
If this magic formula is found, the
adapting its traditional ‘modus operandi’ ad revenues.
benefits could be truly incredible, having
to take advantage of this fundamental
A magic formula to overcome this
the potential to transform the potency
change in consumer behaviour.
predicament and effectively monetise
of advertising across all forms of media
Whilst social networks provide significant online’s most heavily used sector,
to connect with target audiences and
competition for traditional publishers in
hasn’t yet been found. However, a major
overcome the current distrust consumers
terms of consumer attention, they also
ingredient will be a fundamentally new
have with advertising.
provide significant opportunities.
approach to the online ad model in
Publishers can improve engagement with terms of both ad units and ad inventory.
their own audiences – by tapping into
consumers’ increasing desire to create
content – and can use social media to
syndicate their content beyond its
traditional confines to a much wider
audience.
14
Copyright © 2009 The Nielsen Company
About this report: The data and insights contained in this report come from the following Nielsen Online solutions.
NetView: The Industry Benchmark for
easy access and customization of
BuzzMetrics: The global standard in
Internet Audience Measurement
AdRelevance data. Whether you buy,
measuring consumer-generated media
NetView tracks usage across Web sites and
sell, create or analyze online advertising,
(CGM)
digital applications to deliver high-quality
AdRelevance provides actionable, timely
With solid data-mining technology, superb
audience data and analytics. Through
information to build effective and efficient
research and Nielsen’s unrival ed experience in
metered measurement of representative
online marketing strategies
media measurement and client services,
panels of Internet users, NetView reports
and ad campaigns
BuzzMetrics helps today’s companies, brands
industry-standard metrics—including
and business professionals better understand
Custom Research & Analytics: Linking
unique audience, page views and time
the influence and impact of CGM on products,
Consumer Attitudes and Behaviours for
spent—as well as loyalty indicators,
issues, reputation and image.
Breakthrough Online Insight
demographic information and other key
Nielsen Online’s powerful survey and
Digital Strategic Services: Strategies and
insights into online activity and consumer
research capabilities, e-commerce tracking,
Tactics to Manage Online Exposure and
behaviour.
demographic information and in-depth
Grow Brand Advocacy
AdRelevance: Accurate Intelligence about
analysis enable you to successful y
Digital Strategic Services is a full-service
Online Advertising Activity
maximize your global Internet marketing
CGM consultancy that gives you the
AdRelevance is the only online advertising
investment and understand how consumers
resources, analysis, advice and tactics to
measurement system that mimics actual
respond to products, services, brands and
proactively exploit today’s digital opportu-
Internet population usage by automatically
promotions – both online and off.
nities, so your brand’s advocacy-building
adjusting itself to traffic patterns. An
program can reach its full potential.
intuitive, award-winning interface enables
For more information on the report, or any of these solutions, please contact:
International:
USA:
Alex Burmaster, Communications Director, UK & EMEA
Nic Covey, Director of Insights
alexander.burmaster@nielsen.com
nicholas.covey@nielsen.com
+44 20 7014 0590
+1 312-385-6718
About Nielsen Online: Nielsen Online, a service of The Nielsen Company, delivers comprehensive, independent measurement
and analysis of online audiences, advertising, video, consumer-generated media, word of mouth, commerce and consumer
behavior. With high quality, technology-driven products and services, Nielsen Online enables clients to make informed business
decisions regarding their Internet, digital and marketing strategies. For more information, please visit www.nielsen-online.com.
Also, visit our blog at www.nielsen-online.com/blog.
About CR-Nielsen: CR-Nielsen, partner of ChinaRank, is the Nielsen Company’s joint venture in China. CR-Nielsen is focused
on providing scientific and comprehensive traffic data analysis services, including online marketing analysis, online advertising
delivery, marketing intelligence, competitive analysis, client orientation, website operation and other data services for commercial
use. For more information, please visit www.cr-nielsen.com.
About The Nielsen Company: The Nielsen Company is a global information and media company with leading market
positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement,
trade shows and business publications (Billboard, The Hollywood Reporter, Adweek). The privately held company is active in more
than 100 countries, with headquarters in New York, USA. For more information, please visit www.nielsen.com.
Copyright © 2009 The Nielsen Company
All rights reserved. Nielsen and the Nielsen logo are trade marks of The Nielsen Company.
