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 “focus” 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. I’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, “The Big Doubt Over Facebook,” Michael Sprague, Vice President of Marketing at Kia’s North America Division says, “The question with Facebook and many of the social media sites is, ‘What are we getting for our dollars?’” Although Kia advertises on Facebook, Sprague wonders “does that ultimately lead to a new vehicle sale?”

Agency executives underscore their clients concerns. According to the Journal, Martin Sorrell, head of the world’s leading ad holding company, WPP, said at a conference in March that “clients, for the very first time are starting to question the measurement issue” when it comes to social media advertising. Sorrell said “clients have gone almost willy-nilly” into social media “because it’s fashionable to do so,” but now they “are increasingly starting to look at the value of those investments.”

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 doesn’t make measurement entirely transparent because, according to the Journal article, “While advertisers can directly track the return from ads on Google and Yahoo, Facebook mostly doesn’t permit third-party surveys on its site or allow ads to be tagged with ‘cookies’…” What’s more, Facebook “has 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.”

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 doesn’t abate, Facebook’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, “If 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 it’s awareness or engagement… then Facebook should be a key part of the marketing mix for most consumer brands.”

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 world’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.

  • http://www.brickmarketing.com/ Nick Stamoulis

    Social media, Facebook in particular, is where the people are.  This means that no matter what product or service you sell, your target audience is using Facebook.  Facebook ads can help from a branding and visibility standpoint and get you in front of an audience that may not be following you.