The Social Media Seesaw
The ups and downs exhibited in the past few weeks suggest that social media continues to grow in popularity but remains a challenge for online marketers.
When it comes to digital media buying, U.S. ad agencies certainly seem to favor social media. According to a new survey of U.S. ad agencies, conducted by media software firm STRATA, a Comcast company, media buyers rank social media second only to online advertising and ahead of search. The survey, which polls both small and large agencies around the country and therefore is representative of a broad sample, indicated that social media is considered the â€œfocusâ€ of digital spending by 69 percent of advertising executives, a 32 percent increase over last year. Mobile advertising also showed strong growth in the survey.
Keep in mind that ad agency executives are keenly aware of media trends, and they know all about the explosive growth of the online world as an ad medium. As I recently reported, ad agencies and their clients are discovering that online videos have a potency that at times can rival television advertising. Television is no longer the no-brainer choice for launching big ad campaigns; digital media is being taken seriously as a viable alternative.
So it only makes sense that the ad agencies would now be flocking to social media, given its current popularity with so many consumers. Agencies, after all, recommend media buys on the basis of consumer reach.
Questions Still Linger
Despite the breathless embrace of social media by the ad world, questions still linger regarding the advertising efficiency of social media. Iâ€™ve commented in the past about the difficulty of objectively quantifying results in terms of being able to attribute sales to social media ads.
It turns out this concern is shared by big advertisers as well. In a recent Wall Street Journal article unkindly titled, â€œThe Big Doubt Over Facebook,â€ Michael Sprague, Vice President of Marketing at Kia’s North America Division says, â€œThe question with Facebook and many of the social media sites is, â€˜What are we getting for our dollars?â€™â€ Although Kia advertises on Facebook, Sprague wonders â€œdoes that ultimately lead to a new vehicle sale?â€
Agency executives underscore their clients concerns. According to the Journal, Martin Sorrell, head of the worldâ€™s leading ad holding company, WPP, said at a conference in March that â€œclients, for the very first time are starting to question the measurement issueâ€ when it comes to social media advertising. Sorrell said â€œclients have gone almost willy-nillyâ€ into social media â€œbecause itâ€™s fashionable to do so,â€ but now they â€œare increasingly starting to look at the value of those investments.â€
Facebook on the Defensive
As the big gorilla in the social media space, Facebook has the most to gain and, potentially, the most to lose. While Facebook has been aggressively pushing its ad business, some of its deficiencies in that area have come to light. For one thing, Facebook doesnâ€™t make measurement entirely transparent because, according to the Journal article, â€œWhile advertisers can directly track the return from ads on Google and Yahoo, Facebook mostly doesnâ€™t permit third-party surveys on its site or allow ads to be tagged with â€˜cookiesâ€™â€¦â€ Whatâ€™s more, Facebook â€œhas alienated some advertisers with what they perceive as a highhanded attitude that implies that marketers have nowhere else to turn. Some media buyers and advertisers said Facebook has stymied their attempts to get more ad measurement, for instance.â€
To blunt criticism, Facebook has collaborated with comScore and Nielsen in an effort to improve the ability of advertisers to track results. That is helpful, but if grumbling from the ad community doesnâ€™t abate, Facebookâ€™s viability as an advertising medium will come under fire just as the company launches its IPO.
In fairness to Facebook and social media in general, marketers need to recognize that there will always be inherent challenges in measuring its ad effectiveness. Social media is simply different from other forms of media. As Sarah Hofstetter, president of 360i, a digital ad agency, told The Wall Street Journal, â€œIf a marketer measures [return on investment] as direct sales from the Web, then Facebook may not be the ideal platform. But if the goal is to move the needle on brand health metrics, whether itâ€™s awareness or engagementâ€¦ then Facebook should be a key part of the marketing mix for most consumer brands.â€
About Barry Silverstein
Barry Silverstein is a freelance writer/marketing consultant. In addition to writing for ReveNews, he is a contributing writer to Brandchannel.com, the worldâ€™s leading online branding forum. He is the author of three marketing books, The Breakaway Brand (co-author, McGraw-Hill, 2005), Business-to-Business Internet Marketing (Maximum Press, 2003) and Internet Marketing for Technology Companies (Maximum Press, 2003). Barry ran his own Internet and direct marketing agency for twenty years. You can find Barry on Twitter @bdsilv.