While advertisers have been flocking to Facebook – especially in light of media opportunities introduced at fMC earlier this year – measuring the impact of their efforts relative to other channels has left some media folks scratching their heads. A Wall Street Journal article published yesterday explores the sense of “doubt” some marketers feel toward their media investment within the world’s largest social network.
Although Facebook has built out a full suite of media opportunities to bolster its $3 billion-a-year ad business, Suzanne Vranica and Shayndi Raice of the WSJ argue that “some marketers … are wondering whether they’re getting their money’s worth.” It’s a fair question – especially given Facebook’s impending IPO purported to happen later this month. By the way, Facebook’s valuation is projected to be nearly $100 billion – or 33x the company’s ad revenue, according to Vranica and Raice.
Yet more than doubt, advertisers are experiencing a sense of confusion regarding how media impact within Facebook can and should be measured. The discussion and debate surrounding social media ROI is nothing new – it’s a topic we’ve been hearing about for years – but it does take on a different weight as brands continue to up their investment in Facebook.
For example, one marketer featured in the WSJ piece cites that while he is increasing his investment, he’s still unsure of if an ad on the platform will lead to an eventual sale. Some brands, like Ford, have conducted research to tie social investment to sales and found that Facebook media can in fact provide a boost to sales. There is widespread agreement that social media is effective in helping reach such goals; however, marketers continue to wonder to what degree social media is driving the sale.
But is this the right way to evaluate success on Facebook? As 360i President Sarah Hofstetter notes in the article, Facebook might not be the right platform for marketers who measure ROI as direct sales from the Web. “If the goal is to move the needle on brand health metrics, whether its awareness or engagement, then Facebook should be a key part of the marketing mix for most consumer brands,” she says.
Evaluating Facebook from the same exact lens as other media, while helpful in some cases, does not do justice to the unique opportunities available on the platform. Consider what media can do if it’s driving consumers to a flourishing community wherein advocacy and brand love truly thrive. It’s in these communities where customers can become loyal advocates – true fans and ambassadors of your brand – who can then share your brand story with their friends via word-of-mouth.
Factoring in a recent Nielsen study which found that nearly 2x as many people trust WOM over traditional paid advertising, the importance of paid and earned media integration within Facebook and other social platforms becomes clear. The interplay between paid and earned is completely unique and requires that marketers take a different approach than they would across other types of media. This is not only true for how they evaluate their investment (as noted above), but it’s also true when it comes to how they plan and execute their media programs.
For further information, read 360i’s report on Building an Integrated Paid & Earned Strategy.