Talking about UK Social Networks

eMarketer estimates that among the 37 million UK Internet users in 2007, about 30% or 11 million of them visited social network sites regularly.

In addition, social network usage is rising rapidly.

According to a 2008 study by Universal McCann, 60% of UK Internet users ages 16 to 54 have created a social network profile, more than double the 27% who reported having one in 2007.

"Online social network ad spending has moved at a slower pace than consumer adoption," says Debra Aho Williamson, eMarketer senior analyst and author of the new report, UK Social Network Marketing: Ad Spending and Usage, "but with the growth of Facebook and the acquisition of homegrown favorite Bebo by AOL earlier this year, things are picking up."

This year, advertising spending on social networks in the UK is expected to rise 77% to £115 million ($225 million).

In 2012, UK marketers are projected to spend £285 million ($533 million), a 148% increase over 2008.

But there are clouds on the horizon.

"A key question for all involved is whether economic conditions will slow the growth of the UK social network ad business, as they have in the US," says Ms. Williamson.

In May, eMarketer lowered its 2008 forecast for US social network ad spending to $1.4 billion, down from $1.6 billion, and the reduction was only partially due to the slowdown in the US economy.

"Social network sites are still trying to figure out what sort of advertising works," says Ms. Williamson. "Tapping into consumers' conversations and spreading brand awareness virally have proven far more challenging than most observers originally thought."

For now, eMarketer expects that the UK market will enjoy slightly greater gains in social network ad spending, percentagewise, than the US.