Despite the number of marketers using Facebook as an advertising tool, they are still unaware of how to measure ROI or how to compare spending to other social and traditional media channels.
Those are some of the takeaways from a survey of Advertising Age readers conducted in conjunction with Citigroup to gain insight on how marketers view Facebook and what their specific plans are in terms of spending marketing budgets there.
The 658 subscribers who took Ad Age’s survey over the past two weeks characterized themselves as decision-makers in social marketing. The respondents were 34% marketers, 34% agency execs, 13% media execs, and various consultants and other members of the marketing ecosystem.
The results were a mixed bag for Facebook that illuminated some of the challenges it will have in scaling ad revenue, but it also indicated that some of Facebook’s perceived challenges with marketers — such as not providing enough transparency and data — are overblown.
The results also revealed confusion on how to calculate return on investment on Facebook and how to compare that to spending in other social and traditional media channels.
Remarkably, Ad Age readers surveyed speak in virtual unison on two questions. Nearly 86% of those surveyed say they currently use Facebook as a marketing tactic. Only 55%, however, say they currently advertise on Facebook, and nearly 88% said they would implement Facebook content without advertising at all.
Those results closely mirror what we’ve heard in conversations with marketers, particularly after GM revealed that it was pulling its ad dollars from Facebook even as it spent tens of millions to build and maintain the presence of their many auto brands on the social networking site.
Of the readers surveyed, 47% said their digital ad budgets were still less than 20% of their total. Nearly 50% said their budgets designated for social-media marketing were less than 10%. That said, 77% said they expected their digital-marketing budgets to increase in the coming year, while 73% said they expected their social-media advertising budget to increase.
While 72% said they expected their social-media advertising budget to increase, only 56.6% said they thought their Facebook advertising budget would increase, while nearly 40% believed it would stay the same.
“I think it comes down to measurement,” said Michael Scissons, CEO of Syncapse. “If you are a direct-response marketer it’s easy to measure. If you’re a brand marketer, it becomes much more intangible to track the point of sale.”
That said, 72% said they consider their Facebook content efforts and advertising strategies to be linked, showing a widespread belief in the interplay between earned and paid media on Facebook. A sponsored story, for example, is just Facebook content turned into an ad and shown to more people. As the theory goes, the better the content, the more effective the ad.
The biggest question for marketers comes when it’s time to measure the impact of their efforts on Facebook. A majority said clicks and “likes” were the most important metrics to look at, but when it came to driving purchase intent just over 19% said they “don’t know” if Facebook is useful and more than 13% said it’s “not useful.” Just 55% said Facebook is “somewhat useful,” indicating a high level of ambivalence on a key branding metric.
Eric Johnson, CEO of Los Angeles-based agency Ignited, said clients are experimenting with Facebook and in some cases upping their investment on it, they’re certainly not dumping their TV budgets into it. Or even their budgets for other digital-media platforms, where the value of clicks and video views is more proven. “The metrics [on Facebook] are not screaming that you have to go and change your budget,” he said.
Respondents also said doing business with Facebook isn’t always easy. About 24% of respondents said Facebook’s advertising-customer support was inferior to other digital platforms; only 7% said it was superior. Asked what it would take to make Facebook a more useful ad platform, one said, “It’s incredibly time consuming and requires a lot of manual entry. Our agency has tried to optimize by working directly with Facebook but found they were unhelpful and lacked the knowledge to move our projects forward.”
And another: “Better analytics and better customer support, like Google’s AdWords.”
Some questioned the notion of ads on Facebook altogether: “I do not believe that Facebook is an advertising platform. We need to explore other possibilities.”
But one of the most widespread criticisms of Facebook — that it doesn’t provide adequate data to marketers — may be overstated. In written comments, several respondents cited data as a key issue holding back budgets. Several gave variations on the simple response of one commenter: “DATA.” Yet asked if they were satisfied with the level of data returned by Facebook, 61% said “somewhat satisfied” and 10% said “very satisfied,” a majority.
Marketers also expressed strong interest in buying mobile on Facebook, with nearly 28% calling it “very important” and 36% “somewhat important” as a marketing channel.
To read the original article in Advertising Age, click here.