US Ad Spend to Hit $1.7B on Social

Trend Continues Worldwide

Ad spending on social networks in the US will reach $1.7 billion this year and cross the $2 billion mark in 2011, according to eMarketer. Spending is growing quickly outside the US, as well. Worldwide, $4.3 billion will be spent on social networks in 2011, a 29% boost from this year’s expected $3.3 billion.

Ad spend on Facebook $1.3B

The company driving most of the growth is Facebook, where advertisers will spend close to $1.3 billion worldwide this year to reach the web giant’s more than 500 million users. In 2010, Facebook will receive half of all social network ad spending in the US and 39% of spending worldwide.

MySpace is diminishing in importance, with an expected $297 million in ad spending worldwide next year, down 14% from $347 million this year.

Twitter hopes to be in the running for spend

Twitter, which launched its ad business earlier this year. This year, the worldwide ad spend on Twitter will be under $50 million. But, the potential for 2011 and beyond could be dramatic if it proves that its “resonance” model of measuring advertising effectiveness works, according to eMarketer.

Online social games and applications aslo are becoming an important part of the ad mix. While advertising is not a primary revenue stream for game companies such as Zynga or Playdom, their large audiences are drawing the interest of marketers. eMarketer expects such companies will attract $293 million in spending worldwide in 2011, up from $220 million in 2010.