Everybody is well aware of the role social media plays in today’s society. Fewer people are aware of the importance of paid social media advertising within campaigns. And even fewer people are aware of how paid social media came into being a standard on all media plans, and how it will grow even further in the coming years.
The very first Facebook ad appeared in May 2005, and it’s very different to the dynamic ads which we are used to today. Just 5 years after this, Facebook’s ad revenue hit $1 billion. Between 2005 and 2006, both YouTube and LinkedIn introduced their own advertising platforms. Twitter didn’t introduce their ad platform until 2010.
This year, advertising spend on social media will reach $8.1 billion, and this continues to grow very fast, reaching $11 billion by 2017. A phenomenal growth.
Facebook is at the forefront of this, with 83% of brands having a presence on it, compared with 74% on Twitter, and 56% on YouTube. There may be a small shift happening; brands are spending more on Facebook, but Twitter advertisements produce a higher CTR, and at lower costs. If Twitter continue to grow their targeting options, more and more of the Facebook budget could be moved over to Twitter. Internally we are seeing both Facebook and Twitter budgets increasing, although Twitter budgets are increasing by a bigger percentage than Facebook budgets.
Social media is obviously the place to reach a huge amount of people, especially the group of users between 18-34 years old. Facebook now has over 1 billion members, and growing each day. However, this isn’t the only reason why brands are spending more and more on social.
Targeting has obviously vastly improved over the years, with Facebook and Twitter leading the charge. Both of these platforms are continuing to develop new targeting options- Twitter are even partnering with third party data providers in the US to allow brands to target behavioural targeting.
This is a huge jump in the targeting abilities on Twitter, and for the first time will allow brands to target ‘in market’ segments, something that was sorely missing before. In market segments may just become the next big thing within social media advertising, as brands are beginning to rely on social more and more in order to drive sales.
Soon we will be able to use this data along with the regular advantages of targeting on social- such as likes, interests, conversation topics. This will essentially create a perfect mix between targeting your own audience, and targeting people who actually want to purchase your product at that particular moment.
Couple that with the upcoming ‘buy now’ button, and it is easy to see why brands are pumping more and more of their digital budgets into paid social media.
Simply put, we will be able to target users who are willing to purchase a given product, and at an exact moment in time. Whatever the product being sold, the key to the success of the ‘buy now’ feature on both platforms is the dynamic use of targeting, and how to successfully capture your audience with the right product at the right moment.
This is all leading to an even bigger role in which social media will play in the marketing mix. Consumers will also be a huge driving force with the growth of paid social media. As they begin to see benefits of correct and proper advertising on social media, they will begin to trust products being sold to them, which in turn will force brands to increase their budgets to keep up with the growing demand.
Agencies, including us at iProspect, are in a great position to drive growth and ultimately sales on social media. We’re seeing this trend of growth in social media advertising spend first hand, and the real role it already plays in the marketing mix and the sales that it really does generate. We have our own dedicated paid social team who are experts in their field driving this growth, and ultimately sales, for all of our clients.