Tapping the gold mine of consumer information across its MySpace social networking site, Fox Interactive Media has been experimenting for a six-month period on a newly designed algorithm, built to travel through the MySpace member profiles and pages to uncover users' interests.
Based on categories like Video games, health, autos, fashion, sports and finance, the algorithm determined the interests of users. Other factors included in the algorithm were things like groups joined, users' heroes, ad responsivenss and friend's identities.
To ensure the system can counted on and is accurate, the copany enlists a number of "relevance testers" who manually go throughout the network every two weeks to doublecheck categories and profiles, ensuring accuracy.
The reason this is so important to the social networks, is they have been siphoning off some of the advertisers from the web portals, but they've done it at a price: low-cost ads. They don't want to become the commodity ad model of the Internet.
If the social networks can come up with targeted ads, they can start to charge premium prices for their ads to increase revenue and earnings.
Fox Interactive Media president Peter Levinsohn said at a Merrill Lynch conference in Los Angeles that “We are blessed with a phenomenal amount of information about the likes, dislikes and life’s passions of our users. We have an opportunity to provide advertisers with a completely new paradigm.”
After the six-month test, Fox Interactive Media executives claim the improvements make the chance of members clicking on ads increase by 80 percent. The company added that auto ads clicks more than doubled during the test time, and music ads increased by 70 percent.
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