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March 2009
Global Faces andNetworked Places
A Nielsen report onSocial Networking’sNew Global Footprint
Social networks/blogs now 4
th
 most popular onlinecategory – ahead opersonal e-mailThese sites account orone in every 11 minutes onlineOrkut in Brazil has the largest domesticonline reach (70%) o any social networkanywhere in the worldFacebook has the highest average time per visitoramongst the 75 most popular brands online worldwide
INSIDE:
 
1
How social networks are creatinga potentially transormationalchange in consumer behaviour
Social Networking has been the globalconsumer phenomenon o 2008.Two-thirds o the world’s Internetpopulation
1
visit a social network orblogging site and the sector nowaccounts or almost 10% o all internettime. ‘Member Communities’
2
hasovertaken personal Email to become theworld’s ourth most popular onlinesector ater search, portals and PCsotware applications.The story is consistent across the world,‘Member Communities’ has taken aoothold in every major market rom50% o the online population in Switzerlandand Germany to 80% in Brazil. Facebookhas become the largest player on theglobal stage, dominant in many countries, yet localised oerings have won the dayin many others.However, the growth in popularity osocial networks – and the resultantbroadening audience – is only hal thestory. The staggering increase in theamount o time people are spending onthese sites is changing the way peoplespend their time online and hasramications or how people behave,share and interact within their normaldaily lives.Consequently, the global media andadvertising industries are aced with newchallenges around the opportunities andrisks this new consumer mediumcreates. Social networks providecompetition to traditional publishers orconsumer attention and at the sametime, acilitate new ways or publishers
Report Highlights
Putting the growth o social1.networks – popularity andengagement – into contextHow the audience to social2.networks is changingThe challenges acing3.advertisers on social networksWhat advertisers can do to4.nd the magic ormula oradvertising in social networksFactors contributing to the5.Facebook phenomenonWhy localisation has won the6.day in many countriesWhere mobile social networking7.has taken the greatest holdWhat ‘traditional’ publishers8.can do in the ace o the socialnetwork phenomenonand advertisers to connect with theiraudiences. So how do they need tochange their strategies accordingly?Consumer engagement within socialnetworks has the potential to changethe way consumers are targeted, not just through the digital medium, butthrough all orms o traditional media.Whilst a ew billion dollars o ad revenuecan’t be wrong, the prevailing wisdom isthat the current level o advertisingactivity on social networks isn’tconsummate with the size – and highlyengaged levels – o the audience. Thesocial networks and advertising industryhaven’t quite yet ound that magicormula to make this happen.The industry is aced with a real ‘Catch-22’situation. Part o Facebook’s extraordinarysubscriber growth is due to a cleandesign with little advertising clutter;consequently, the audience growthhasn’t been accompanied by a similarsurge in advertising revenue. On theother hand, MySpace’s more customisableentertainment and content-orientedoering – carrying more advertising –has been more successul at attractingadvertising revenue, yet MySpace’saudience is fattening. The industry willbe watching very closely at which one othese undamental dierences in strategywill prove the most successul inattracting advertising revenue in 2009.This report puts the global socialnetwork phenomenon during 2008 intocontext, providing insights and lessonsor the networks themselves, advertisersand the media industry on how to takeadvantage o what’s happening onlinearound “Global Faces and NetworkedPlaces”.
Introduction
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In this report, the terms ‘Global’ or ‘World’ encompass the ollowing countries in which Nielsen Onlinehas a NetView panel – USA, Brazil, United Kingdom, France, Germany, Italy, Spain, Switzerland andAustralia. (Whilst Japan gures are shown in certain graphs, Japanese data isn’t included in any globalgures.)
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Nielsen Online’s ‘Member Community’ category includes both social networking and blogging websites.
Copyright © 2009 The Nielsen Company
 
2
Dec-08Dec-07
61%5.4%67%65%9.9%75%63%9.9%73%67%2.7%70%59%10.3%69%64%2.6%67%64%2.9%67%55%4.9%59%39%12.5%51%41%9.6%51%
  S  w  i  t  z e  r  l  a  n d  *  G e  r  m  a  n  y  *  A  u s  t  r  a  l  i  a  F  r  a  n c e  U  S  A  U  K   J  a  p  a  n  I  t  a  l  y  S  p  a  i  n  B  r  a  z  i  l  *  G  l o  b  a  l
78%
1.4%
80%
 
78%
    1
Figure 2: Germany has seen the greatest increase in online reach oMember Community websitesFigure 1: Member Community growth twice that o any o the other vemost popular sectors
Source: Nielsen Online, Global Index, December 2007 – December 2008. E.g. In Dec 08 the Search sector reached 1.9% (points) more of the world’s online population than it did in Dec 07 
1
‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only Source: Nielsen Online, NetView, Home and Work Data, December 2007 – December 2008 (*Home only). E.g. InDec 08 ‘Member Communities’ reached 67% of the global online population compared to 61% in Dec 07 
1
‘Global’ refers to AU, BR, CH, DE, ES, FR, IT, UK & USA only (JP figure not included in Global figure)
Social network and blogging sitesare now the ourth most popularactivity on the Internet 
‘Member Communities’ now reach over5 percentage points more o the Internetpopulation than it did a year ago – agrowth rate more than twice that o anyo the other our largest sectors.The strongest growth has come inGermany where the sector now reaches51% o Germans online compared to39% a year ago – an actual increase oover 12 percentage points.Large growth has also occurred in theUK, Spain, Italy and Switzerland – thesector reaching 10% percentage pointsmore o the online population in each othese countries than it did a year ago.
RankSectorGlobal
1
 ActiveReachDec 08Global
1
 ActiveReachDec 07% PointIncrease inActiveReach
1Search85.9%84.0%1.9%2General Interest Portals & Communities85.2%83.4%1.9%3Sotware Manuacturers73.4%72.0%1.4%4Member Communities66.8%61.4%5.4%5E-mail65.1%62.5%2.7%
Natural German reserve when it comesto disclosing personal data resulted insocial networking taking o later than inmost other countries. As in manycountries, younger people were the rstin Germany to embrace social networks.However, the activity is starting tospread to the wider online populationdue to sites like “Wer-kennt-wen”,literally translated as “Who KnowsWhom.” Including neighbourhoodcommunities and job-related networks,“W-k-w” addresses a more mainstreamaudience than previous dominant playerssuch as StudiVZ, which targets students.Takeovers by big traditional mediacompanies – bringing signicantinvestment and managementexperience – have also helped bringsocial networking to a wider audience.Publisher Holtzbrinck bought StudiVZ(within eight months its audience grewby 168%) and ater TV network RTL, asubsidiary o media giant Bertelsmann,bought “W-k-w”, its reach tripledwithin a year.
Germany arrives later to thesocial network party
Facebook has started to make a biggerimpression since launching a Germanlanguage interace in March 2008 – the lastsix months o 2008 saw the site triple itsaudience to over 2.4 million Unique Visitors.However, Facebook is still only the sixthmost popular social network in Germany aslocal players already had a signicant headstart (MySpace, third, is the most popular‘international’ player). In act, StudiVZ,started in 2006, was so similar to Facebookthat Facebook sued it in a Caliornian courtin 2008, alleging that StudiVZ copied itslook, eel, eatures and services. StudiVZdenied the claims.
Copyright © 2009 The Nielsen Company
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