Social media advertising versus traditional marketing campaigns

Whenever you try to research the effectiveness of social media advertising, you consistently get very vague and ambiguous information. Does social media advertising really work? Is there a measurable return on investment? I think the answer to both questions is obvious. Yes, social media advertising works and no, you can’t measure the return on investment. Digital zombies will make you think otherwise, but there is no real measurable return. Consider Facebook’s recent IPO; many investors simply could not accept the valuation of a company that sells something intangible without real data to support its marketing strategy.

Before we explore the context of this article and go into deep and gut-wrenching thoughts on how to effectively balance and structure your strategic marketing platform, we need to first consider a few data points.

Based on a recent unscientific study, we ran some numbers on social media advertising platforms. The first was a Google AdWords campaign that received just over 28,000 impressions and 128 clicks, or about a 0.45% click-through rate. The second was a Facebook campaign that received more than 505,000 impressions with less than 45 clicks; this is a click-through rate of less than 0.01%. Finally, there was a similar campaign on Linked-In that had just under 30,000 impressions with a click-through rate of 15, again less than 0.01%. At this point, you can clearly see why Facebook’s IPO was such a poor value proposition. In essence, not really, because you need to carefully weigh your total marketing campaign among many forms of media to deliver your message effectively and get measurable results, read on:

Now let’s look at the total dollars spent on marketing across all media in the US:

Television: $66.4 billion in 2013 to $75.4 billion in 2012

Digital media: $32 billion in 2013 to $61.4 billion in 2017

Television remains the nation’s leading advertising medium with annual spending of more than $66 billion in 2013 and is expected to maintain the dominant position in the future. Since almost 2/3 of all marketing budgets are spent on TV and digital media, the real question is extrapolating the ROI of one versus the other. I would speculate to say, despite much opposition from the geek community, that television is vastly more effective than social media. But don’t stop here, you must be the final judge based on some of the data we will present.

social media vs. traditional marketing platforms: Social media is cheap, it’s interactive, somewhat measurable and, in most cases, time-consuming to accurately implement an effective campaign. Comparatively, traditional marketing is expensive; it is not reciprocal, something measurable and very tangible. Most advocates will tell you that there is an inverse relationship between the effective growth and decline of each medium. On the one hand, the pro-social authorities will say that they are on the rise and the traditional forms are on the decline, while the traditional ones proclaim the opposite. The fact is that both are growing and an effective marketing campaign will have to use both mediums.

The cost of social media marketing makes it extremely attractive, approximately $5.00 per thousand impressions vs. $10.00/M for TV, $30.00/M for print and $55.00/M for direct mail. However, when it comes to engagement levels, TV is at the top with over 50% compared to Facebook at 12% and Twitter at 2%. Additionally, consumers place a higher level of trust in television marketing because higher costs are directly associated with a more reliable message.

With traditional advertising, we often measure a broad demographic reach compared to social media, where we may measure a narrower message to speak to an individual’s concerns or a more personalized message. Social media creates a broader overall customer experience that allows you to monitor and participate in what people are saying about your brand or company. Unfortunately, designing a campaign to address these finite concerns is very difficult, primarily because the likes of Facebook and others do not share demographic profiles to allow businesses to effectively target a specific demographic. Mark Zuckerberg recently bought all the houses surrounding his Palo Alto residence because he was concerned about privacy his company has collected more information about you that you are interested in knowing if they ever publish this data beware the barrage of targeted ads will be overwhelming .

What should the future of your marketing platform look like? It should contain a carefully balanced mix between traditional media and digital media, depending on the marketing goals of your brand and company. As the chart above clearly illustrates, all forms of media are alive and growing, with the possible exception of newspapers. However, all must be considered. Most people are tired of sharing information and are making their social profiles much more private, almost to the point of being annoyed. Social networks are not immune from users feeling they have been mistreated, and if they want to proliferate, they must create useful interactions with their users.

We have become an empathetic society, Obama, his staff and his economic policy have clearly demonstrated this cultural change. Marketers need to focus on a “shared responsibility” strategy and leverage their move to this platform. Shared responsibility? Yes, we have adopted a cultural change, at least temporarily, so that our life decisions are made by third-party entities. It reminds me of being on the Titanic when the front of the ship was under water and the people and the back were like, “I’m glad I’m in the back of the ship.” This may be an extreme example, but many consumers will be looking for targeted ad campaigns to guide rather than suggest.

Millennials (18-34 years old) continue to demonstrate an unprecedented interest in working together to support this empathetic society. They believe that a fragmented government unable to make meaningful change for the better is the way of the future. Marketers must recognize that this is the number one force in America and beyond. This philosophy dictates that you deliver measurable value and relevance on the same scale millennials think, your marketing strategy must embrace these behavioral changes while increasing sales. Check out my post titled “Gen Y Influencer” and “Generation Y Influencer Marketing Strategy.”

I think this will be the year of the global “slump” in terms of more localized marketing platforms. Consumers will be most influenced by localized marketing campaigns that hit the heart of their sphere where they live, where they shop and what they buy. As stated above, people are getting tired of being ruled by Google’s algorithms and will seek to make decisions that are free of some digital outcome. Look into employing five local marketing officers instead of one global marketing officer, you’ll get spectacular results. Consumers will look for consistency, impact, pleasure, and simplification from the brands they support.

Anticipate a move in the future towards a disconnect from the online community to a more traditional approach. Consumers are looking for more contact, more connection and more fun in marketing strategies. So ask yourself this question: “Ask not what your customers will do for you, ask what you can do for your customers.”

Conclusion: How you interpret this report is entirely up to you and should be structured around your company and brand strategy. At its core, it is critical that you understand your customer and their marketing campaign. At the end of the day, nobody can assign an effective value to digital media; no one has been able to determine if the return on investment is worthy. However, the moral is this: digital media have a huge impact and cannot be ignored, they are cheap to implement but difficult to achieve. Digital media must be combined with traditional forms of marketing to create the most effective strategy.