MySpace Making Room for Advertisers
MySpace is trying to create a friendly space -- for advertisers.
News Corp.'s fast-growing Internet social network plans to announce a marketing deal today with the Improv chain of comedy clubs to bring performances, behind-the-scenes footage and other content to the new humor section of MySpace.
Executives hope to laugh all the way to the bank. MySpace Comedy is a key element of News Corp.'s strategy of turning the website’s heavy traffic into big profit by creating special sections for blue-chip companies leery of the sometimes racy content on MySpace users’ personal pages.
Other MySpace sections include music and movies. The company said it expected to revamp its sports and games sections soon to make them more appealing to marketers who want to get their messages across to MySpace’s mostly young audience without the risk of having their ads appear in unwanted places.
The appeal of MySpace and other social networking sites is that they allow users to create personal Web pages with photos and blog entries. Users can then create communities by inviting “friends” to link to them. Some of the pages, however, contain material that spooks image-conscious advertisers.
But by making the website more viable for advertisers, News Corp., which paid $580 million for MySpace last year, risks losing the edginess that made the website so popular among teenagers and twentysomethings.
“The minute users sniff trying to be conned, they move away, so you need to remain authentic,” said Ross Levinsohn, president of Fox Interactive Media, which oversees MySpace. “It’s a true balancing act.”
More than 52 million U.S. Web surfers visited MySpace in June, according to market research firm ComScore Networks. Richard Greenfield, a media analyst with Pali Research, estimated that the site would generate $200 million in revenue this year.
“They have tremendous traffic that’s been growing exponentially,” Greenfield said. “Part of the equation is to make it easier for advertisers to approach MySpace, whether that’s the home page or safer sections. I think it’s a very logical step in the right direction.”
MySpace is also charging advertisers to promote their product pages, such as the “X-Men: The Last Stand” movie page that signed up 3.2 million friends. Another revenue boost is expected from search-related advertising; the company is in talks with the big Internet players to provide a better search engine on MySpace.
Pepsi-Cola North America won’t advertise on user-created pages, but its Sierra Mist beverage is the main sponsor of MySpace Comedy, and its Aquafina bottled water brand sponsored the site’s Filmmakers section.
“It’s important for us to be on screened sections of the site,” said Pepsi spokeswoman Nicole Bradley.
Carlos Mencia is a stand-up comic and cable TV show host who is featured in MySpace Comedy. He credits his MySpace page with boosting his career and bringing him in closer contact with his audience; he has 96,000 MySpace friends and often chats with fans online.
“When I was a kid we used to go to the park, or to 7-Eleven on the weekend,” he said. “MySpace is that place for a lot of these kids, man.”
He promotes upcoming tour dates and his Comedy Central show, “Mind of Mencia,” on MySpace, but he sometimes worries that he’s taking advantage of his fans’ goodwill. He said he understood that MySpace executives were trying to walk a fine line.
“People are interested in what I’m doing, but on the other hand they don’t want to be bombarded with ... spam,” he said. “As soon as it becomes a marketing machine, a sales machine, people will leave it.”