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THE DIGITAL REALM: WPP, the world’s largest advertising agency holding company, will spend $400 million with Facebook this year, doubling what it spent last year. This figure comes nowhere near the $2 billion it will spend with Google in 2012, but Sir Martin Sorrell, WPP’s chief executive officer, said that’s because Google is more powerful right now. It has search, display, social, video and mobile application, through its acquisition of Motorola Mobility. “Facebook is a social network.…If you interrupt that social communication with commercial messages…is it as potent as search or indeed as display or indeed as mobile? I don’t think so,” said Sorrell, during a CNBC interview on Thursday, adding it’s more difficult to monetize a social network.
And as WPP’s clients shift more to the digital realm and spend less on print, magazine publishers are struggling with how to themselves monetize Facebook. Most have Facebook pages with reader engagement and plenty of “likes” but much more can be done, according to New York University professor Scott Galloway. He’s also the founder of L2, a digital think tank that recently reported that one out of eight minutes spent online is on the social network site.
He gave a stern lecture to magazine executives in October, during the MPA’s American Magazine Conference in New York City. Galloway said publishers should be spending more with Facebook because it’s the least expensive way to target a young, affluent audience. To date, his firm has named Time magazine as the only print title to reach “genius” status (which means, its social and mobile efforts are head and shoulders above the competition of 87 titles that were studied). Earlier this week, WWD reported that Jason Binn is talking to Sean Parker about creating a digital Facebook magazine. If it happens, magazine publishers could have a serious competitor on their hands.