Advertising on social networks is expected to drop in 2009 after a period of strong growth, amid spending cuts by marketers and problems at MySpace, according to a story in the Wall Street Journal.
A new report by eMarketer, set to be released Thursday, sharply reverses an earlier prediction by forecasting that ad spending on social networks will fall 3% to $1.1 billion this year, according to the Wall Street Journal.
Written by Emily Steel, the story says that in December, eMarketer had predicted that 2009 ad spending growth would be 10.2%, with revenues rising to $1.3 billion.
Online advertising has been considered an important area of growth in the depressed ad industry, the story says, but while social networking sites have been popular with consumers, they have yet to gain significant traction among advertisers.
MySpace is the largest social network in terms of ad revenue, the story says, but it’s lead is beginning to erode as rival site, Facebook expands.
WSJ Online subscribers may read the full story here.