Rise of Paid Social Ads to Bring More Focus on ROI Measurement

Social media advertising used to be about establishing a presence on popular social network sites and interacting with fans and consumers on these sites. However, as consumers spend more time in the social space and platform providers look for a way to build a business model, marketers are Social Media keyboardbeginning to pay for social media. A key challenge for marketers and platform providers will be agreeing on how to measure the effectiveness of this paid ad strategy.

A new study from Vizu, a Nielsen company, shows that about 89% of marketers use free tools on social media while 75% are paying for some of their activity on these sites. When it comes to agencies, 81% are paying and 71% use the free tools. For now, the dollar amount shifted to the paying tools remains modest with 70% of marketers applying between 1–10% of their online budgets to paid social media. But this year, at least 64% of marketers plan to increase their paid social budgets.  To fund the added costs, 23% will reduce their online display budgets and 39% will reduce their offline media budgets.  Paid social advertising is largely done in conjunction with an overall marketing campaign.

Analysts say that media sellers like to focus on likes/​pins, click-​throughs, and views as effective measurements of a campaign’s success. However, marketers and agencies are more likely to want to define what constitutes brand lift and then measure the results of a paid social media campaign using agreed-​upon metrics. This will be an area of intense media sales competition as almost half of marketers and their agencies say they’ll increase the amount of social media advertising they’re buying once the right benchmarks are established.

[Source: Paid Social Media Advertising. Nielsen​.com. 2013. Web. 27 Feb. 2013] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.