Accordingto The Salesforce Marketing Cloud Report, based on global advertising data across Facebook, Twitter and LinkedIn, covering more than 2 trillion impressions and 200 billion engagements, in the last 18 months there has been a seismic shift in both the entire digital and advertising landscapes.
Facebook advertising CPMs were highest for the telecommunications ($9.40) industry and lowest for the gaming ($2.76) vertical in Q1, according to data released by Salesforce Marketing Cloud. Salesforce’s data shows that in Q1 the professional services vertical saw the highest average cost-per-click, of $1.12, more than 5 times that of telecom advertisers ($0.21). Meanwhile advertisers from organizations and associations (3.72%), retail (3.37%) and telecom (3.37%) appear to have crafted the most compelling creative, averaging the highest click-through rates for the quarter.
Among the major shifts, mobile is further entrenching itself as the first screen; according to Yahoo, people spend more minutes per day on their mobile devices than watching TV. 88% of those 177 minutes per day are spent with smartphones and tablets in mobile apps as compared to mobile web, a percentage that has continued to grow each year.
The Executive Summary points out key trendswith Facebook, Twitter, and LinkedIn as follows:
In the UK, social advertising, led by Facebook, Twitter, and LinkedIn, reached almost £1B in 2014 a staggering 65% year over year increase, says the report.
New advertising channels are emerging, including Instagram and Snapchat, with new ways to reach audiences at all stages of the marketing funnel. Facebook itself surpassed YouTube for video views and its views are growing at 91% annually according to Mixpo.
A scientific study in October 2014 with Facebook, looking at the impact of coordinating marketing across two key channels: Email and Facebook advertising. Findings, after the group was exposed to messages in both channels, showed that they were 22% more likely to purchase.
This revolution in technology will help break down organizational barriers within marketing silos and between brand teams and their agencies, fostering tighter collaboration between marketing, sales, and service, says the report.
Globally, the overall CPM decreased by 11%, to $3.30, reflecting normal seasonal trends in digital advertising. Facebook itself shows increased overall revenue in Q4 relative to Q1 both this year and last year in line with the overall advertising industry, as it has matured and become a major channel in digital advertising.
In the U.S., the overall CPM decreased from Q4 to Q1, to $3.72. At the same time, CTR in the US increased to 0.86%, indicating a healthy engagement with the ads. Similar decreases in CPM were seen in multiple other countries, including France, Germany, and Japan.
Ads targeting consumers in these countries showed a small decrease in CTR, and the CPCs declined relatively less than the CPMs. This decrease in CTR implies that consumers have engaged with ads in these countries at a lower rate in Q1 than Q4. Globally, the overall CPM decreased by 11%, to $3.3.
US Facebook Ad Benchmarks (Q1 2015)
Consumer Packaged Goods
Food and beverage
Organizations and associations
Source: Salesforce, July 2015
Social.com customers use two major ad types on Twitter; Promoted Accounts and Promoted Tweets. Promoted Accounts are used to drive new followers for a given Twitter handle, while Promoted Tweets focus on all other objectives. Neither ad type can be bid purely for impressions, on a CPM basis, so any CPM-based analysis shows the media cost despite bidding on engagement-based objectives.
Both major ad types saw a decrease in CPM and a slight increase in cost per engagement (CPE) from Q4 to Q1; Promoted Tweets only rose one cent in CPE, to $0.45 in the United States. However, the engagement on the ads fell from 2.28% to 2.00%, and the CPM decreased to $8.92.
Because there are many more ways to engage with a Promoted Tweet (e.g. link click, favorite, or retweet) than a Promoted Account (just following the account), the CPE for Promoted Tweets remains about half that of Promoted Accounts.
On Twitter, advertisers cannot bid on a CPM basis, but must bid for some action, such as any click on a Tweet, link clicks, or video views. Therefore, focus on measuring the specific metrics that matter to your campaigns, says the report.
On LinkedIn, the CPM in the United States declined from Q4 to Q1 to $13.05, indicated a general maturing of the advertising platform. LinkedIn revenue from ads, according to their latest earnings report, has risen rapidly, with $119M in revenue from selling ads in Q1 2015, a 38% increase from Q1 2014.
At the same time, Sponsored Updates (the in-feed ad unit that social.com supports) rose to 40% of advertising revenue, up nearly double the prior year, according to Ad Age. The slight decrease in CPM indicates that more advertisers are buying more ads, not just existing advertisers are paying more for the same inventory. This bodes extremely well for the health of the LinkedIn advertising ecosystem, concludes the report.
The CPC of LinkedIn also declined slightly, to $3.89, because users continued to engage with the ads at approximately the same rate, with CTR declining just 0.02 percentage points between the two quarters. Advertisers can take advantage of the premium audience on LinkedIn by creating campaigns that drive specific actions on your websites, such as filling out a test drive form for a new car at a dealership.
Please visit Social.com for access to the complete report.