Bebo plans to ride cyber chat wave by appointing agency to attract advertisers

Media & Marketing:Social networking website Bebo has appointed an agency to attract Irish advertising to the site, with companies and organisations like Permanent TSB and Open University signing up, writes Emmet Oliver

Generator, the online advertising specialist, is representing the website, which claims to have 700,000 registered users in Ireland.

While Bebo has yet to establish a specific Irish site, the nationality of users can be picked up from their IP address, and Irish content and advertisements are then offered to them.

Generator already has a strong client list, including Daft.ie, Eircom.net and RTÉ.ie. It recently signed a deal to sell advertising space in Ireland on behalf of MSN, Microsoft's site.

Managing director Mark Tarbatt said companies seeking to access younger people were interested in using Bebo. The company's recent decision to appoint Rachel O'Connell as chief safety officer is likely to have an advertising spin-off too.

Some companies have so far been squeamish about putting banner adverts on social networking sites like Bebo and myspace.com because of the dangers of cyber bullying and children being groomed by sexual predators.

But Bebo's founder Michael Birch claims the site spends 10 per cent of its turnover on safety measures.

However, large companies tend to be ultra protective of their brands, even if it means missing out on some opportunities. But Tarbatt says the growth of the online advertising market is clearly evident.

Last year he booked €2 million of advertising business for his group of publishing companies, but he expects this to double this year.

Irish internet advertising is dominated by two agencies, Generator and Sales Online. Commissions on online advertising vary and are jealously guarded.

They are believed to range from about 20 to 40 per cent of the value of the advertising paid, and depend on variable revenue targets and other measurements as agreed with publishers on a case by case basis.

The growth of the social networking sites helps to bolster web-based businesses generally, many people argue.

It is reported that the founders of Bebo, Michael Birch and Xochi Birch, were recently offered £300 million (€443 million) for the site by BT, but it is believed the owners are looking for closer to $1 billion (€779 million), although Birch has described this as a ridiculous amount of money.

The site is behind myspace.com in the UK, but ahead of Google's Blogger site and Friends Reunited, the site bought by ITV, which has lost traffic in the past six months.

In Ireland, Bebo is the number one social networking site and Disney recently put advertisements on the Irish version of the site for its new movie Cars.

The European private equity fund Benchmark Capital recently invested $15 million in Bebo, probably on the basis of the advertising uplift.

In sectoral terms they are right, as there is a strong expansion in web advertising. Zenith-Optimedia, the media buyer, predicted it will account for 7 per cent of all global advertising by 2008.

In Ireland the sector is still the poor relation, falling way behind press, TV, radio, outdoor and cinema advertising.

But it is growing fast and within a short period those in the industry are hoping to pass out cinema and then outdoor advertising.

How quickly this happens probably depends on the social networking sites, as well as property sites and maybe even blogs.

But there is some ground to make up in Ireland, where newspapers and magazines hoover up €926 million each year in ad revenue, some 64 per cent of the total spend for Ireland. Yesterday Initiative, the Dublin agency, said online advertising had already caught up with cinema based on rate card returns for the first half of the year.

'Sportsman' newspaper pitches for backers

The Sportsman, the sport and gaming paper which has gone into administration, is either in its final death throes or on the brink of a miraculous recovery depending on which media reports one believes.

Dermot Desmond, pictured left, is believed to have been approached to put some money into the paper and, as a racing enthusiast and Celtic shareholder, this would make sense.

The other backer being sought out is Ben Goldsmith, son of James Goldsmith.

Other reports suggest Desmond simply heard a pitch from the shareholders and has reserved his position.

Cinema advertising house gets Irish-run PR firm

The cinema sales house Pearl & Dean has appointed public relations agency Eulogy! to handle its media relations activity in Ireland.

The cinema advertising house is synonymous with big-screen advertising and is in competition with the likes of Carlton Screen for business. Eulogy! is mainly based in the UK, but is run by an Irishman Adrian Brady and has accounts like Enterprise Ireland and ABC, the circulation monitoring body.

Unilever emerges as advertising big spender

The biggest advertisers in Ireland in 2006 have now been disclosed. The big spender in this period was Unilever, which lobbed €11.9 million into the Irish market.

This was followed by Diageo with a €7.9 million spend.

As a reflection of its takeover by Eircom, Meteor was a major spender with €5.3 million, which was even higher than more established operators like O2.

Emmet Oliver can be contacted at eoliver@irish-times.ie