Social media has long been synonymous with “owned” or “earned” media -- the kind you don’t actually pay for. But a new survey commissioned by Nielsen unit Vizu
indicates that three-quarters of advertisers are spending on paid social advertising and nearly two-thirds (64%) plan to increase their social ad budgets this year.
That’s welcome news to Facebook, Twitter, Instagram and others as they ramp up paid ad opportunities on their respective platforms. Still, social media budgets remain relatively small. Last year, the vast majority (70%) of companies earmarked 1% to 10% of overall ad spending to social media, with only 13% allotting 21% or more.
And while social ad spending is expected to rise this year, the increases will be modest. Four in 10 marketers plan to grow paid social ad budgets by 1%-10%, while 15% said they expect to increase budgets by 11%-20%, and 11% by 21% or more. The increase in social ad spending will often come at the expense of other online and offline marketing channels, including online display.
Social might be growing even faster as an ad category if businesses had better means of gauging its effectiveness. A lack of standard metrics for measuring ROI remains a major stumbling block. Less than one-third of both advertisers and agencies said social advertising is effective and produces measurable ROI.
Two-thirds of advertisers said social ads “move the needle” when used with other efforts, or is a promising new tactic, but they’re not sure how to assess how well they work.
The study noted that many marketers are using things such as “likes,” “pins” and click-throughs to evaluate campaign results, but prefer to apply more traditional metrics. More than half of advertisers and two-thirds of agencies said a clear link between social advertising and sales would increase their use of the medium. Many want to see a link to brand lift.
“It is not a coincidence that these metrics translate to both offline and online mediums,” stated the report. “Media buyers should ensure that they are using these relevant metrics to get an accurate assessment of campaign ROI.”
That’s especially true since paid social media is mainly being used as part of broader branding campaigns. Two thirds of advertisers run social ads with other online advertising; 51% do so with offline advertising. Social ads typically run most often in conjunction with online display, online video and mobile efforts.
As part of cross-platform campaigns, marketers want to use the same metrics for social ads that they use for online and traditional media. “Very few media sellers, however, can actually provide this,” according to the study. Only 11% said they could provide the same metrics as offline along with some measures specific to online.