My friends over at IZEA has just released its first report on The State of Social Media Sponsorship for the second quarter of 2010. The report was compiled from survey data of over 2,800 social media publishers, consultants, marketers and public relations professionals who volunteered to participate. It uncovers the impact sponsorships have on engagement, compensation practices, publisher preferences, and earnings.
The survey defined Social Media Sponsorship (SMS) as the practice of providing compensation to a social media publisher in exchange for mention, promotion or review through a publisher’s social media channels. Compensation may be in the form of cash, free product or service, experiences, discounts, coupons or other brides.
- 88.3 percent of social media publishers monetize social media in some way
- 87.4 percent of social media publishers have or would create sponsored content
- The average social media publisher spends $711 per year on hosting, education, conferences and related social media costs
- Twitter users earn 298 percent more in SMS for their blog than non-twitter users
â€œThe growth of the SMS industry is astounding,â€ said Ted Murphy, CEO and founder of IZEA. â€œAccording to PQ Media, social media sponsorships are positioned to grow from $46 million in 2009 to over $160 million in 2014, this explosive growth presents significant opportunities for publishers to monetize their social media channels.â€
With social media enabling every consumer to become a publisher, advertiser demand is clearly increasing. Brands of all sizes recognize the value of building relationships with social media publishers. This is validated by the majority of publishers (71.3 percent), who stated that they have been approached by someone offering cash, free products, discounts or other compensation in exchange for a blog post, tweet or other social media promotion.
While the report underscores the growth in SMS, it also highlights areas of concern. Survey data determined that 35 percent of public relations, social media and marketing professionals are not aware of the FTC guidelines on endorsement announced in late 2009. Only 29 percent of these professionals indicated that they read and understood the guidelines, meaning that the majority are unclear as to the best practices.
â€œOur space is maturing and becoming more sophisticated;â€ said Murphy, â€œhowever, we clearly need better education among both advertisers and publishers. In order for this space to gain widespread acceptance, everyone needs to play by the same legal rules and ethical guidelines.â€
You can grab your copy of the The State of Social Media Sponsorship at IZEA’s website. It’s free.