Social Networks Not Clicking?

That was the conclusion reached by market research company IDC in a recent study as described by MediaWeek. It seems that while IDC recognizes the aggressive growth rate of social networks, they see ads being ignored.

According to IDC’s report (U.S. Consumer Online Attitudes Survey Results Part III), more than three quarters of social networking site users log on at least once a week, and 57 percent do so daily. And these folks are logging an increasingly large amount of time on these properties, as more than 61 percent of users spend more than a half hour on these sites per session, with 38 percent staying at least an hour.

Yet despite those huge usage numbers, social networking sites like MySpace and Facebook significantly under perform when compared to overall online advertising, found IDC. Just 57 percent of social net users report clicking on an ad over the past year versus 79 percent of all users, according to IDC’s study. A similar disparity is evident when it comes to online shopping.

Social networking sites continue to evolve how they display ads in order to combat this lackluster facebook ad exampleperformance. Facebook has made several enhancements to its advertising options including new ads that appear in news feeds as well as ads that appear next to relevant user actions.

I disagree with placing all the blame on these social networking sites. Many advertisers have just not figured out how to use this new advertising medium. Advertisers make the common mistake of treating these social networking sites like a media buy and throw up the same creative ad units they use in display campaigns. Messaging must be tailored to this audience and ad designs should look to leverage the social networking platform rather than ask it to mimic other advertising platforms. At NETexponent we have been running social media campaigns for several months and just formally launched our Social Media Services division. Here are a few of the tips we have learned.

1. Target – Social networking sites offer a slew of tools that advertisers can use to target their audience by demographic, geography, and interests. The interest targeting ability is what really makes these marketing channels unique so be sure to target accordingly. You may want to target different campaigns to different segments to enhance your ability to tailor the ad to each segment.

2. Tailor – Make sure your message is tailored to your audience. Once you target the right segment be sure to customize the marketing message so that it appeals to that audience but keep in mind that you are in a social media environment. Hard sell call to action messages like “buy now” may not work in this environment. Try first to engage your users with softer calls to action such as “learn more” or if you have customer testimonials try “hear what others have to say”. Create different messages for each segment you target since they will most likely respond to the most relevant message.

3. Test – Many social sites provide enhanced reporting but none of it will replace your good old ad serving solution. Test out different ads and even test ads that look like text to see how they perform. In addition to testing landing pages perhaps you want to test driving traffic to your company/product fan page. How about special consumer offers for Facebook users?

My overall point is that advertisers have a unique opportunity to tap into this new and growing online channel. Nobody has published the secret formula for success but it is out there if you are willing to search for it. I have seen the rewards and they are definitely worth the effort.

About Peter Figueredo

Having worked in the online marketing arena since 1997, Peter Figueredo has seen the ups and downs of this industry. He is currently the CEO of Affiliate Management and Search Marketing Agency NETexponent. which he co-founded in 2001. Prior to that his online direct marketing experience came from working at interactive agencies such as Mass Transit Interactive, as the EVP Director of Performance Marketing, and i-traffic, currently a division of where Peter held the title of Director and helped establish and grow their Affiliate Marketing Services division. At a time when affiliate marketing was relatively unknown Peter was building and managing affiliate programs for leading Fortune 500 companies.

Peter’s company recently launched an Affiliate Marketing Research division called Affiliate Benchmarks to provide Affiliate Marketers with more insights and data.

You can find Peter on Twitter: @figueredo.

5 Responses to Social Networks Not Clicking?

  1. Pat Grady says:

    "I disagree with placing all the blame on these social networking sites."

    Me too. And when billboards don't work, I don't blame the city that built the streets either.

    The people are there. And they are effectively being exposed to advertising. What remains is the effectiveness of the advertising itself, and the propensity of that population to receive the message and in sufficient numbers, act on it. It's that last part where I think social stuff loses the majority of its luster – they're there to socialize, not shop. We should have much lower expectations for advertising's effectiveness in this setting.

    "Many advertisers have just not figured out how to use this new advertising medium."

    And most never will… fit, format, finesse, friends, foment, and some other f words (not T words Peter) need to be examined and strategized. Social advertising channels just aren't going to fit well for some things. Others will require so much dedicated resources to maintain momentum that you'll eventually be writing articles about time and resource management tools when it comes to social marketing initiatives… or the latest social mark shill scheme… but until then, the hidden discovery theory is intriguing…

    In the meantime, I'm off to work on ways I can effectively advertise to the high disposable dollar men found in the chairs at gentlemen clubs…

  2. Hi Pat,

    I love this line…

    "And when billboards don’t work, I don’t blame the city that built the streets either"

    nicely said

    Your point about time and resource management is definitely valid. Social Media can be a huge time suck and a black hole of resources. This was a major discussion point within my agency when deciding how to price our social media services. The key will be for advertisers to prioritize their social efforts and not spread themselves too thin. For example, it might be nice to have a page and build a community on MySpace..but do you really need one? does it match your brand or target audience? is your time better spent elsewhere?

  3. Pat Grady says:

    Peter, gotta tell you, it is SO refreshing to hear a g-man (you work for the agency) talk about not spreading clients too thin, and properly prioritizing, and that social efforts (or any corner) can become a time suck. We both know most agencies go for max spread without enough real regard for effectiveness / roas.

    And now is the perfect time for someone with your savvy, insight and honesty to pull ahead of your peers in the marketplace – downturns are nature's way of shaking the ineffective branches from the tree. I can see your clients will certainly bear healthy fruit, even during this cloudy period. And when the weather clears, your wood will be stiff and able to support all kinds of wild marketplace luvin on their behalf.

  4. hi Pat,

    Thanks for the kind words. I would be lying if I said our focus on prioritization was for the sole benefit of our clients. We too benefit from clear focus and manageable goals/initiatives so it really is a win-win. Sounds like you are doing great things as well…i wish you all the success in 2009. Enjoy your holiday and thanks for the comments

  5. I also like the streets and billboards line, but it does matter if the billboard is on Park Avenue or the other side of the tracks.

    Most social networks are just people talking to their friends and using applications. It is possible to match ads to these types of users. There also are social networks beiong developed around specific target markets. These social networks will allow a much more targeted advertsing spend.