Advertising on social networks 'uncertain'

A third of European online advertisers plan to launch their own profiles on social networking sites in the next year, analysts have reported.

But only a quarter of these companies measure whether users interact with their online ads, according to a report by JupiterResearch.

The report examined the success of using these so-called 'engagement' tactics and how best to measure their effectiveness.

"The majority of European online advertisers plan to use engagement marketing tactics in the next year, so it is vital that the industry finds ways cheaply and accurately to measure the impact of these campaigns," said Nate Elliott, senior analyst at JupiterResearch and lead author of the report.

"Most European advertisers jump on the engagement marketing bandwagon without truly understanding which tactics represent the most appropriate and effective use of their marketing resources."

The report revealed that over half of European online advertisers used tactics intended to increase user interaction in the past year, and nearly two-thirds will use engagement tactics in the next year.

Although viral campaigns remain the most popular form of engagement marketing, advertisers' use of tactics that engage users more deeply, including the use of profiles on social networking sites, will increase.

Furthermore, advertisements that encourage users to contribute photos and videos to advertisers' websites are predicted to grow more quickly.

However, it can very difficult to calculate the success of these advertising methods as the usual metrics for measuring the effectiveness of more traditional campaigns do not apply.

"As marketers increasingly try to reach consumers through social networking sites like MySpace and Facebook, as well as video sites like YouTube and DailyMotion, they should turn to their online ad agencies for help in gauging the success of these efforts," said David Schatsky, president of JupiterResearch.

Schatsky added that agencies must develop accurate and simple benchmarks and proxies to discover and prove the relationship between technology-based measurements and traditional brand impact surveys.