Cashing in on Orkut

2009 should be the watershed years in terms of monetizing of the social networking sites through ads targeted on user specific information. Mark Zuckerberg knows it and Google is doing it. Orkut which is the No 1 networking site in India is tieing up with IPL to create its own brand positioning platforms to lure advertisers. What it offers advertisers is a better opportunity to create engagement and branded pages, groups etc with its users... to create its own buzz. Ultimately at some level it may serve as a online brand building medium with a decent RoI.

“Last year, we built a stronger base of marketers and invested in internet advertising. In 2009, we should make revenues from our social media platform,” says Google India Managing Director Shailesh Rao. Google is banking on converting its vast network of Adwords advertisers to Orkut, where they can place targeted and contextual advisements on various social communities and user profiles, reaching individual customers directly.

According to comScore data, in 2008, Google sites ranked as the top property in India, with nearly 20 million visitors. Orkut registered nearly 10 million visitors, marking a growth of 39 per cent. Orkut Apps, the blog that has become popular for software developers to market their social applications, has also opened new revenue streams for Google. An estimated 45 million internet subscribers drove the online advertising market to Rs 240 crore in 2008, and according to Federation of Indian Chambers of Commerce and Industry (Ficci) estimates, it could touch Rs 2,500 crore by 2011. But a harsher financial outlook in 2009, combined with an expected fall in online advertising, is forcing the networks to focus more on making money from existing subscribers than on adding new users.

The only catch is the belief that a user on social networks is browsing to keep himself updated with his network of friends and to interact with them. Thus he is immune to ads. It is now Google, with its formidable access to users and advertisers and customized solutions, which is going to test the axiom of "immunity to ads on social networks". Whether it can extend the success of its ad sense and ad words is what we will see happening through this year.