New Delhi: Growing popularity of social media is expected to help grow the global revenues of the platform by 43.1 percent to reach USD 16.9 billion in 2012, research firm Gartner said Wednesday.
The social media revenue stood at USD 11.8 billion in 2011.
Advertising will continue to be the largest contributor to overall social media revenue and is projected to total USD 8.8 billion in 2012, Gartner said in a statement.
Revenues from social gaming more than doubled between 2010 and 2011 and is expected to reach USD 6.2 billion in 2012, while revenue from subscriptions is expected to total USD 278 million this year, it added.
"Usage of online social media has matured, and more than one billion people worldwide will use social networks this year," Gartner Senior Research Analyst Neha Gupta said.
Although the number of social media users is large, and in some cases increasingly mature in their usage patterns, the market is still in its early stages from a revenue perspective, she added.
"New forms of media and entertainment will keep users engaged on social media sites and attract new ones. Rising competition among social media players, each vying for consumers' leisure time and attention, will lead to the rise of new forms of social media (web based and mobile)," she said.
Marketers are allocating a higher percentage of their advertising budget to social networking sites.
This is mainly driven by the fact that these sites offer a large pool of engaged users who spend considerable time on these sites, which increases the potential click-through rates.
"Social media sites are becoming more innovative in their ad products to attract marketers. Social networking sites should deploy data analytic technologies that interrogate social networks to give marketers a more accurate picture of trends in accordance with consumers' needs and preferences," Gupta said.
Gartner expects social media sites to continue to incorporate gaming techniques on their networks, driven by the monetisation opportunities that it presents.
The sale of virtual goods will remain the primary source of revenue, it added.
"The biggest impact of growth in social media is on the advertisers. In the short and medium terms, social media sites should deploy data analytic techniques that interrogate social networks to give marketers a more accurate picture of trends about consumers' needs," Gupta said.