While social networks amass huge audiences and are the most dynamic sector in digital advertising, they tend not to bring in revenues to match. Luckily for brands, that’s beginning to change—and we have the four reasons why.
More metrics.
For advertisers wondering whether their efforts are paying off, new social analytics services seem to be launching every week. Facebook, for instance, recently unveiled a new measurement tool called Insights, which has stats like “Friends of Fans.” The social networking company also says advertisers will soon be able to aim their messages at users even more carefully using data from Facebook’s integration with media services like Spotify and Hulu.
Facebook Insights Dashboard - Sharing Metrics
Facebook Insights Dashboard - Sharing Metrics
Facebook's Insights Dashboard provides deeper analytics on user demographics, “Likes,” shares and reshares. The above sample dashboard images are designed for page owners, publishers using the new social plugins and application developers.
In September 15, 2011, Twitter announced that they were implementing a Web analytics Dashboard. The new analytics tools has been in beta since late 2010. The dashboard will consist of four tabs:
- Traffic: this tab will correlate information between the number of tweets linking to a site against the number of people actually clicking those links. There will also be a graph that measures this information with the following options; one day, the week and the past month.
- Tweets: this tab will display all tweets containing links to a site, including any tweets sent from the site’s embedded Tweet button.
- Tweet Button: this tab displays interaction and engagement a site gets from its Tweet button.
- Content: this tab compiles the site’s top-performing pages.
It will be nice to be able to see how this is being shared in the Twittersphere, the amount of traffic (or Twaffic) being referred and measure the amount of interaction a Web site generates with the Tweet button.
Content is advertising is content.
Facebook and Twitter have both emphasized turning regular user content into ads—Facebook through its Sponsored Stories unit and Twitter through its Sponsored Tweets. But that doesn’t mean the death of traditional advertising copy. In fact, Facebook has a new ad unit that blends a friend’s activity (e.g., “Anthony likes Movie X”) with a message from the advertiser.
A new Facebook advertising product, "sponsored stories," plans to pull content out of members' posts for use in advertisements that will appear on their friends' Facebook pages.
Social blindness less blind.
The bad news: Some, like Altimeter Group principal analyst Brian Solis, believe “blindness or deafness” to brand messages is going to increase on social networks as they’re flooded with promotional content. But there’s good news, too: Some companies are working on ways to fight the clutter. Facebook, for instance, announced that it’s starting to organize user newsfeeds based on an algorithm that it calls Graph Rank—so brand activity that’s actually generating user interest won’t get buried.
Social discovery of apps is seen as the next frontier in solving the troublesome problem of finding useful and relevant programs from among hundreds of thousands of choices.
Facebook CTO Bret Taylor wrote.
“App discovery is an important part of the Open Graph philosophy. The structure of the Open Graph enables apps to grow more quickly based on usage. The more engaging your app is, the more people will discover it on Facebook.”
It’s not just about Facebook.
Yes, Facebook claims the majority of social ad spending, but other services are starting to make progress, too. For example, an advertiser survey conducted by The Pivot Conference found that 16 percent of respondents had run campaigns with Foursquare, and another 26 percent planned to do so in the next year. And eMarketer is projecting that LinkedIn’s ad revenue will grow from $79 million last year to $250 million in 2013.
COMMENTARY: I don't agree completely with Anthony Ha's assessment that social media is about to take off as a platform for generating revenues. The data I have seen clearly shows that social networks are not very effective in either driving traffic to a brands websites or generating a buy decision. Only about 50% of small business owners are using social media. There are a lot of Likes, but these don't correlate into real buying decisions.
There have been several studies about social commerce or f-commerce and the revenue projections are hardly worth talking about, which might explain why there has not been a huge rush by brands to embed their site within Facebook. That 30% cut that Facebook takes for Facebook Credits, the standard currency on Facebook, does not help matters either.
Overall, I do believe that the addition of analytics by both Facebook and Twitter is a good thing, but has been very slow in coming, and are only going to be useful if brand managers know what they need to measure, can establish achievable goals, are prepared to be pro-active, and know how to act on the data being measured to improve engagement and potential revenues.
On the whole, I believe that social networks are better suited for generating feedback from fans about their products and quality of service via polls and surveys. Some marketer's have referred to social networks like Facebook as the world's largest focus group. This is where social networks truly shine.
Social networks can be very powerful forces in generating viral traffic, but this can also backfire, so brands need to be extra careful. RIM BlackBerry's recent worldwide service failure is a great example where a major service failure can undo ten years of customer loyalty. The BP oil spill is another great example of negative viral marketing.
Courtesy of an article dated October 17, 2011 appearing in AdWeek and an article dated September 13, 2011 appearing in ReadWriteWeb
Comments