How to turn social media into cash

Paid Content reports that executives from a new generation of tech media companies, from Twitter to Tumblr, gathered to discuss how to make money in an age of social, mobile media.

The Advertising Week event, titled Masters of Monetisation 2.0, featured some useful insights into the business of ads and engagement.

Takeaways included:
1. In-stream, native advertising works best
What do LinkedIn, Twitter, Buzzfeed and Tumblr all have in common?  These companies all embed sponsors in their content stream rather than laying ads on top it. This provides a less disruptive user experience and better engagement for advertisers. In-stream ads also scale well to smaller screens which, for many publishers, can be a marketing black hole. “If you can get into the feed where people are looking and not piss them off, that works,” said BuzzFeed’s CRO, Andy Wiedlin.

2. Mobile natives are best positioned to offer mobile ads
This may seem intuitive but consider a company like Foursquare, which uses location tools to help people find friends and places. As CRO Steven Rosenblatt pointed out, a lack of “desktop baggage” means Foursquare is not tempted to try and shoehorn older ad models into the mobile environment. A company doesn’t have to be born mobile, however, to succeed on smaller screens. Jonathan Lister, VP of Sales at LinkedIn, explained how the company had designed its mobile site for the “coffee and the couch” habits of its tablet readers. But the most striking example of a company adapting to mobile is Twitter: VP Joel Lunenfield disclosed that the company, whose embedded ads work well on a small screen, now makes more money from mobile than from the desktop.

3. Social communities aren’t created equal
Social media lets advertisers reach a “community” but that’s just the beginning of the story. Advertisers must also decide the relative value of a given company’s network of users. LinkedIn, for instance, claims that leads based on its professional profiles are three times more likely to convert than the personal ones on Facebook. They must also figure out what to do with “transient communities.” “The interesting thing about communities is that there�s established communities and communities that just establish around an event,” said Twitter’s Lunenfield. His point is that events can give rise to a massive and passionate target audience — but that advertisers must be nimble to reach them in time.

Read the rest of this article on Paid Content.

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