Social networks abound on the internet, from the behemoths like MySpace and Facebook to the startups like Treemo and Organized Wisdom.

Over the last few years, many have speculated about the financial stability of business models where the keys to the content are held by the public. Well, there is good news for social networks according to Prospero Technologies. According to research conducted by Prospero Technologies on the social network advertising forecast, 31 percent of online advertising companies are planning to significantly increase spending on social media apps in the coming years. Whats more, 58 percent of these online advertisers say they plan to up their social network spending to some degree.

This could mean that online advertising companies are seeing value and realizing traffic from social networks or… they still haven’t figured out the impact that social networks are having on their bottom line. The rest of the Prospero research points to the latter because their survey found that 41 percent of companies did not know how their social media advertising performed in terms of return on investment (ROI). This is a bit startling from a marketing standpoint. Why? Because until an online advertising company can produce solid ROI stats, a fixed advertising budget cannot be established.

While this is still good news for social networking sites, startups included, it seems that advertisers are still working on a way to measure the true value that social networks offer to their clients.

Co-founder and VP of Prospero Technolgies put it this way,

“…businesses are becoming more sophisticated in creating new revenue sources through social media, with 12 per cent citing ad revenue and nine per cent reporting sponsorships as important measures for success.”

On a smaller scale, individual online marketers already KNOW the power of social networks and, in most cases, have figured out how to measure ROI. Sometimes, I think corporations and large online advertising companies get lost in the status quo and overlook innovative techniques.

TIP: For more on a great social network advertising strategy, read the recently published eBook “Bending the Web“.

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