Social networking sites (SNSes) like MySpace.com and Facebook attract large numbers of mostly young users who are eager to engage with their favorite brands. But most marketers use traditional marketing tactics like run-of-site advertising and static microsites to push messages into these networks. Instead, to realize the full value of marketing on SNSes, marketers should be prepared to engage in a personal relationship with users by providing something of value. Promotions are good in this context, but even better are information or brand elements that users can pass on to their friends.

Social networks connect people at low cost; this can be beneficial for entrepreneurs and small businesses looking to expand their contact base. These networks often act as a customer relationship management tool for companies selling products and services. Companies can also use social networks for advertising in the form of banners and text ads. Since businesses operate globally, social networks can make it easier to keep in touch with contacts around the world. In many ways business networking on social networks has eclipsed the amount of networking that takes place on dedicated business networking websites.

How consumers responded to the survey question: "If the following were available on a social-networking website, which would you likely do this holiday season?"

• Find out about store sales/product discounts: 51%
• Download coupons: 51%
• Search for gift ideas: 47%
• Buy products: 29%
• Post or view videos: 20%
• Read or write product review on blog: 18%
• None of the above: 12%

**Does not total 100% due to multiple responses

Many who go to MySpace or Facebook to network with friends also would go there to buy stuff. But for the most part, they can't.

And that means there may be billions of dollars being left on the table by the major social-networking websites, according to an eye-opening survey to be released today by the American Marketing Association.

In a survey commissioned by the AMA, 47% of consumers said they would visit these sites to search out and discuss holiday gift ideas, and 29% said they would buy products there.

POINT & CLICK HOLIDAYS:   More consumers go online for holiday shopping

The networking sites "provide some of the most powerful word-of-mouth-marketing opportunities there have ever been," says Nancy Costopulos, chief marketing officer at the American Marketing Association. "It's past the fad zone and into the reality zone."

The dollars available: $211.4 billion will be spent for online purchases this year, including travel, according to Shop.org , part of the National Retail Federation. More than one-third of all U.S. households shop online. The big social-networking sites now rely on ad revenue for most of their income. But they're popular with younger consumers, a huge e-tailing revenue base, who now frequent hip fashion and electronics sites or even Amazon.com to buy online.

People who go to them would buy things, but none offers the option in a major way, says Brian Kardon, chief strategy officer at Forrester. Revenue from sales on the sites could be worth billions of dollars, Kardon says - potentially more than ad revenue. Ad spending on social-networking sites is now about $350 million a year and could grow to $2.5 billion by 2010, projects researcher eMarketer.

Some 51% of respondents to the survey said they'd be willing to go to a social-networking site this holiday season to find out about store sales - or download coupons. The online survey of 1,098 consumers was done earlier this month by Opinion Research.

Executives at MySpace and Facebook declined to comment. A spokeswoman at LinkedIn, however, was not enthusiastic about sales on the social-networking site for business professionals.

"It would be a stretch to say that people are checking LinkedIn before buying gifts," spokeswoman Kay Luo says. However, many people list their hobbies in their profiles, which could trigger gift ideas, she says.

Critical to commerce on social sites would be a "soft sell" that doesn't feel overly commercial, says David Szymanski, chairman of retail studies at Texas A&M.

Assuming that can be accomplished, there's nothing more effective than the word-of-mouth marketing that takes place on social-networking sites, he says. "It's the trust factor."

The survey was done ahead of a discussion of social networking by the nation's top marketers at an AMA forum on new media next week in Orlando called Mplanet 2006.

Social Networking or Social Media Marketing are the major buzzwords in the Search Marketing world lately. Social Networking has had a strong presence on the Web for quite some time; however only now has it really reached its highest point. So, what is Social Networking? It's just that. Web sites created which allow networks of people to share content or Web pages that they find interesting. In the process, in-bound links are spread virally that are indexed and rewarded by search engines.

There are basically two types of Social Networking avenues; Web sites such as Digg , Technorati and Reddit which allow you to submit articles that in turn users can vote on whether they like or not. The other is online book marking sites such as Del.icio.us , Simpy , Yahoo MyWeb and Netscape which allow you to share you bookmarks across the Web.

Top search engines (Google, Yahoo and MSN) have been granting great importance on links from Social Networking sites, especially Digg. By submitting articles / stories related to your industry that are on your Web site, you can easily gain links that search engines see as good, quality links thus benefiting your search visibility.

Social Networking for Link Building

Why all the hype? Social Networking has become an important piece of the pie in terms of your link building strategy and overall search positioning. Social Networking can increase traffic to your Web site. However, unless your story can compete with Britney's newest dilemma or Hollywood 's dramas, don't expect a large amount of traffic to come from it. The links your articles receive from Social Networking sites is where the real link building advantage lies.

To gain the most bang for your buck with Social Networking link building, you need to write about topics that professionals, consumers and readers within your industry will find interesting and important. Try writing "how to" articles or describe your opinion on current industry developments. Remember, your articles / stories must be written in an informative manner. Sales pitch content will not serve its purpose and may even get you booted from the Social Networking sites. With Social Networking, the key is to sell by not selling.

Whether you decide to Digg or book mark, go ahead and take advantage of Social Networking, since it seems to be here to stay. At least for the time being!

Keep it Real

Just as with every new communication technology, there are those who use the medium in overbearing, unwanted ways. Social networking sites are no different. The key term here is "networking," give and take. According to Bob Baker , author of MySpace Music Marketing , social networking success stories have one thing in common: "They're all about the ping-pong effect ? It's you sharing yourself with and getting to know dozens, and then perhaps hundreds of people. In turn, those people mention you to their friends."

It's NOT about posting, sending and otherwise spamming hundreds or thousands of others. Because interaction is a key feature of these sites, the potential for backlash is enormous. Social networking sites are back-and-forth communication forums, not broadcast media. Annoy or abuse people and they'll tell the world.

So what can you do on these sites? How exactly does one share his/herself and get to know people?

Basic Online Marketing Principles

There are certain basic online marketing principles that apply when networking online. Among them:

- First and foremost, no spam. Communication should be individual and meaningful, not bulk, impersonal nonsense.

- On a related note, do not use automated software to post generic comments or messages in bulk.

- When emailing or messaging, unobtrusively remind people of what you do through your signature. Include your name; clickable Website URL; tagline or short mission statement; and/or other contact information in the signature.

Finding Connections

A critical component of successful networking (both in the physical and cyber worlds) is finding quality connections. On social networking sites, first think about the types of people you want to connect with (see "Whom to Interact With" in part 1. Then use a variety of methods to find them:

- Use the site's search features to find connections by their psychographic or demographic features (religion, age, gender, geographic location, interests, likes/dislikes, etc.)

- Each time you find a new connection, look for additional connections in her or his network.

- Study comments on your connections' pages ? or those outside your network with similar interests ? for potential new connections.

Approaching People to Become a Part of your Online Network

After finding potential connections, approach them about becoming part of your network. Ways to do this include:

- Send a friend request to each.

- Post thoughtful, relevant comments on their pages (which also creates new links to your page).

- Return comments on your page with relevant ones on the commenter's' page.

- When contacting someone, send a private message and leave a comment on her or his page.

Working your Network

The flip side of finding potential connections is having potential connections find you. There are several things you can do to become more approachable:

- Your page is the first thing people see when researching you, so keep it appealing. Regularly review comments others have left and delete irrelevant or crude remarks.

- Add new content to your page often, giving people a reason to visit regularly.

- Set aside time to respond to comments and messages.

Like all worthwhile business relationships, online networks must be nurtured. Make the effort to do so, and over time you will reap the rewards.

One in four adult Internet users in the U.S. regularly visits popular social networking sites, according to "iProspect Social Networking User Behavior Study," a report sponsored by iProspect and conducted by JupiterResearch .

The study defines a social networking site as "one that allows Internet users the ability to add user-generated content such as: comments, review, feedback, ratings, or their own dedicated pages." Sites such as MySpace, YouTube, and Amazon.com fit the study's classification of social networking sites.

While one quarter of the adult online population may be considered a small segment, lacking the reach of major search engines like Google, Yahoo, and MSN, it accounts for 41 million people, according to Rob Murray, president of iProspect.

The audience visiting social networking sites is self-selecting in terms of looking for specialized sites to suit particular interests. These specialized sites deliver highly-targeted audiences.

Many of these sites target communities defined by their affinity to a vertical industry, business model, or interactive activity type, unlike MySpace and YouTube, which are designed to appeal to the mass population.

"Most marketers would far more prefer targeting a very think slice of a highly relevant audience than doing the mass marketer appeal," said Murray .

Beyond display and sponsored listings, opportunities exist for marketers. Past reluctance to get involved in online social communities signals marketers to remain cautious. "Participation on these sites can take a couple different forms," said Murray . "[Marketers] have to pick the right site, picking the one that most closely matches your online audience. Being very transparent in your communication is very important. Each community has its own rules of engagement; a marketer must abide by those rules."

Consumers visiting social networking sites generally do so through direct navigation and bookmarks. Secondary is navigation through Google and Yahoo, or links in e-mail. In addition to optimizing participation on a social networking site to be visible on Google or Yahoo, marketers need to ensure "that their content is of high enough interest, quality, or value that it will serve as 'link bait' or 'bookmark bait.'"

The report, conducted by JupiterResearch, is based on an Ipsos U.S. Online Consumer Panel of 2,223 individuals. The survey consisted of 25 closed-ended questions about behaviors and preferences regarding online holiday shopping, search, ISP and video, online social networking (on behalf of iProspect), and online dating. Data were weighted by AOL usage, online tenure, and connection speed, determinants of online behavior.