Advertisers Can't Afford to Quit MySpace

None Back Out After Site Says It Removed Profiles of 29,000 Sex Offenders

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How many advertisers backed out of MySpace last week after it revealed it had deleted the profiles of 29,000 known sex offenders -- more than four times the number originally suspected -- from its site?

A Fox Interactive spokesman said marketers were placated after being told that MySpace had deleted 29,000 sex offenders from its system. | ALSO: Comment on this article in the 'Your Opinion' box below.

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Not a single one.

That's because even though marketers tread carefully around MySpace, they avoid the site -- now the fifth-largest by unique visitors, according to ComScore -- at their own risk. Marketers can't afford not to advertise on social networks because they account for larger and larger chunks of the time kids spend online. According to Grunwald Associates, 96% of online teens and tweens report using social networks.

Calming fears
Julie Henderson, senior VP-corporate communications at MySpace parent Fox Interactive Media, said a few concerned marketers called when the news came out but were placated when told MySpace had deleted those 29,000 profiles.

"We're pleased that we've successfully identified and removed registered sex offenders from our site and hope that other social-networking sites follow our lead," said MySpace Chief Security Officer Hemanshu Nigam.

Ms. Henderson pointed out that 29,000 out of 180 million registered users is one-thousandth of a percent. (Agency executives pointed out that 29,000 comprises only the offenders registered under their own names.)

The number underscores the fact that social networking -- and the internet in general -- is still in large part a bastion of anonymity. Chat rooms and e-mail have also been sources of predatory behavior.

"Any circumstance that supports people's anonymity can lead to issues like this. It's whether or not that overwhelms the greater good," said Rob Norman, CEO of Group M Interaction.

'An active role'
"One would hope MySpace would take an active role in alleviating this issue because the best way to solve it is to clean it up and take it out of marketers' hands," said Jason Klein, president of Special Ops Media, a MySpace advertiser on behalf of some of its entertainment clients.

Elias Plishner, senior VP-digital communications, Universal McCann, Los Angeles, said his agency uses two tactics to help clients understand what they're getting into. The first is a careful examination of every site's registration policies, and the second is a competitive-landscape overview. If a client is more risk-averse, he might recommend a more closed site such as Facebook.

"Social networking is a great place to find communities with like interests, market to them upfront and have them build brands for you," Mr. Plishner said. "We still need to be there, but it's a matter of what type of network you pick."

Easing concerns
For some marketers, education is the key to feeling comfortable. About six months ago, Sapient Interactive was seeing results buying MySpace ads for client Citi's college-targeted credit cards but took a hiatus when Citi's corporate-marketing team became concerned about the site's content. MySpace's sales team conducted a workshop to assuage the client's fears, and Citi returned to the site.

Safeguards under consideration may help ease marketers' concerns. The North Carolina House of Representatives is considering a bill, already passed by the Senate, that would require parental consent for children to join MySpace (see story below). And MySpace said it is pushing for legislation that would require convicted sex offenders to register their e-mail addresses, allowing sites to block them, and make it a parole violation to falsify that information.

Despite the risks, brands have had success on MySpace. A study earlier this year from FIM and Carat touted the value of consumers' interactions with brands on MySpace. In campaigns for Electronic Arts and Adidas, friends passing along brand messages contributed to more than 70% of the sales return on investment.
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