A recent study by JupiterResearch reports that half of all advertisers are spending less than 5% of their online budgets on social media ads in 2008, which is a much smaller chunk of the pie compared to Search and Display. Larger marketers have been the most hesitant in getting more involved with advertising on Social Media due to challenges with measuring ROI and brand metrics.
Overall, marketers are still unclear on how to leverage this emerging channel and how to measure results. In addition, marketers have limited performance history to use as a comparison with the channel. Social Media publishers realize there are some issues, and are beginning to offer more tools to marketers to help ease any worries.
Social Media users are flocking to these sites, but that doesn’t equate to interaction with the ads. According to a recent MediaPost article, 54% of users never click on ads, 39% occasionally click on ads, and only 7% often respond to Social Ads.
As social media publishers like FaceBook and MySpace continue to offer more tools to advertisers to help them customize their campaigns, there should be a higher adoption of the channel and increased budgets should soon follow.
Being that I have been in the SEO/SEM industry for almost 5 years, I am not surprised by how much Social Media has grown. Social Media is being utilized on a daily basis and not just by the savvy searchers who constantly blog or the commonly used networks like MySpace, YouTube and Facebook either. Case in point – I recently spent the day with a friend who has a precocious 7 year old daughter. To put it mildly, this 7 year old has become a social media guru! She now belongs to Club Penguin, which is self-described as “a snow covered virtual online world for kids”. What more could a 7 year old desire?
Disney acquired the social media network in August of 2007. Through this network, kids can purchase virtual clothing, furniture and even pets for their penguins. Kids can play on the site for free; however, certain features, like furnishing an igloo (which becomes essential, of course) and chatting with other penguins will require the parents’ trusty plastic card! Very smart indeed, although my initial reaction was wait just a second, this chatting could certainly go awry if parents are not constantly aware and monitoring the context of the chat. Not to worry, mom and dad! Club Penguin thought of everything. The network was designed with safety in mind and thus, offers what is known as Safe Chat. Safe chat limits what can be chatted back and forth by providing the children with a predefined menu of choices.
Social Media is everywhere! From Blogs, to Press Releases, even to Club Penguin! The fact that a 7 year old belongs to a social networking site is enough to make anyone realize that social media is growing and an integral dimension of the internet today. In addition, keep in mind that there are huge SEO benefits to be gained from social media. The engines love fresh content to crawl on a website. It’s definitely time to jump on the Social Media Bandwagon!
I recently ran across this article from BusinessWeek that discusses the challenges of advertising on social media sites. Websites, such as MySpace, seemed to come right out of the gate with display advertising, while others treaded more cautiously before heading down this avenue.
Today, it would appear that neither has found the magic recipe of pleasing both their advertisers and users at the same time. According to the BusinessWeek article, advertisers find that “as few as 4 in 10,000 people who see their ads on social networking sites click on them, compared with 20 in 10,000 across the Web.” In addition, users are feeling invaded and frustrated, some going as far enough as to start petitions against the sites!
Although predictions for growth on social media sites will be down from last year, we can still expect a 75% increase in ad spend. Aggravated visitors may choose to cancel their accounts, but the fact still remains that these sites aren’t going anywhere! They continue to make great efforts to update their advertising platforms with future promises of, for example, additional targeting options to reach a more engaged visitor.
My thought is that it can still be a smart way to reach your target demographic, but you have to be sensitive to that fact that they don’t want to feel like their MySpace is a walking advertisement for your product or service. More to come on this revolution, I am sure!