"Dollar for dollar, you are actually going to receive more branding, and more impression impact, using streamed endorsements on Facebook and Twitter, than people seeing an ad on Facbeook, because the engagement rate is so much higher," says Ryan Steelberg, CEO of Brand Affinity Technologies (BAT), which conducted the analysis involving campaigns it executed for undisclosed brands in the automotive, entertainment, technology and retail categories involving endorsements from celebrities including Drew Brees, Snoop Dogg, Matt Hasselbeck, Enrique Iglesias, Khloe Kardashian, Nick Swisher, and Kendra Wilkinson.
Steelberg described the performance of the social media endorsements as being "magnitudes" higher than the corresponding ads placed on social media pages. Specifically, he said celebrity endorsements on Facebook averaged a 50% improvement in cost-per-action (CPA) vs. conventional ads placed on Facebook. Clickthrough rates were 21 times greater.
Endorsements streamed through Twitter were somewhat weaker on clickthroughs, but higher on actual conversions. Celebrity endorsed tweets generated clickthrough rates that were 17 times greater, and CPAs that were 72% higher than ads on Facebook.
Steelberg said the test covered campaigns that spent a total of about $70,000 each on the three "buckets" being compared: celebrity plugs on Facebook and Twitter, and conventional ads on Facebook. The Facebook ads were not endorsements, but conventional brand messages.
Steelberg acknowledged that the media of celebrity social endorsements and social media advertising are still young, and that performance would likely change over time as celebrity, consumer and brand behaviors evolve, but that at least for now, endorsements seem like a more cost effective option.
Steelberg also acknowledged that BAT has a vested interest in promoting the value of social media endorsements, because it is one of its core services, but he said BAT also is heavily staked in marketing celebrity endorsements via traditional media - primarily radio - and he said that the two media actually work very well together. He likens Twitter's more ephemeral nature to radio buys, because they require continuous frequency for a brand's message to resonate, vs. Facebook, which tends to have more permanence with user's posts remaining on their walls and friends' newsfeeds over time.
Taylor Valentine, vice president of social media and relationship marketing for Horizon Media, agreed. Valentine, who has worked with BAT on celebrity endorsement campaigns in the past, got a preview of the results, and said they "make sense," but added that social endorsement campaigns have to be in keeping with the goals and spirit of the brand that is using it, as well as the celebrities touting them. More than anything, he said there has to be an organic and "genuine" connection between the celebrity and the brand, and that the campaign must appear authentic to the consumer. When done correctly, Valentine said he could see marketing budgets shifting from conventional display advertising in social media to streamed celebrity endorsements via social media.
"The trick for companies like BAT or Ad.ly [which competes with BAT] is making the best connection, and the best means the most natural connection, between a celebrity and a brand, because that is what yields the most influence and the greatest brand results," he said.