Monetizing MySpace Traffic

Earlier this month, News Corp. said that Fox Interactive Media (FIM) generated $225 million in revenues in the quarter ended June 30, 2008, up 23% year over year. For the fiscal year 2008, FIM generated revenues of $856 million a little bit less than the $1 billion target News Corp. chief Rupert Murdoch had set this time last year.

FIM consists of a number of Websites, including MySpace, AmericanIdol.com, PhotoBucket and FOXSports.com. News Corp. has never said publicly how much of FIM’s revenues come from MySpace, but the generally accepted estimate is 80%. That would put MySpace at about $685 million in revenues for the fiscal year (including both US and international).

A recent eMarketer analysis of FIM US revenues shows that FIM is getting better at monetizing its traffic.

eMarketer estimates that the US accounts for 80% of total FIM revenues. That puts US revenues at FIM at $180 million in the June quarter, up 23% from $146 million in the same quarter in 2007. By contrast, the average number of monthly unique visitors in the US grew just 6.6% in the same time period, according to eMarketer’s analysis of comScore Media Metrix data.

US monthly revenue per unique visitor is also growing. In the 2007 June quarter, FIM earned roughly $0.59 in average monthly revenue per US unique visitor, according to eMarketer’s calculations. In the 2008 June quarter, average monthly revenue per US unique visitor was $0.68—a 15% increase.

One factor driving better monetization is MySpace’s HyperTargeting initiative, in which display ads are targeted based on information users put in their profiles. 50% of all ad buys on MySpace now include HyperTargeting, and for the past two quarters CPMs for HyperTargeting campaigns have been more than double those for nontargeted advertising, News Corp. COO Peter Chernin said during last week’s earnings conference call.

If you are advertising on MySpace and not using HyperTargeting your campaign is seriously underperforming your competition.