Social Network Advertising is a Waste of Time

by Samir Balwani on November 19, 2008

Don’t waste your time and money advertising on social networking sites. People just aren’t receptive to it. Social media ads suffer from extremely low click through rates and just disrupt the flow of social media users. It’s true that there are positives of social media advertising but I think the negatives outweigh them.

Positives of Advertising on Social Media

Demographic Targeting
This is the strongest point for social media ads. Since sites like Facebook and Myspace invite users to share what they like, advertisers are able to target users by terms found in their profile.

Obviously you can use this at the most basic level targeting users by age, location, and gender. You can also go beyond that by thinking outside the box and targeting TV shows, products, books, and movies that a demographic that parallels yours.

Huge Audience
Social media users are amazingly loyal. They spend a lot of time on their corresponding sites and tend to check their profiles often throughout the day. Because of the number of page views, an ad on the site gets seen multiple times meaning great branding potential.

According to Compete’s figures for every unique visitor to YouTube there are 54 pageviews. With Facebook, a unique visitor creates an amazing 564 pageviews in a month and on MySpace each person generates a staggering 1,110 pageviews. credit

Cheaper Cost
This is a positive aspect for now, only because this could quickly change as people start to use social media ads more. Cost per click prices for usually extremely expensive keywords on Adwords are generally far cheaper on Facebook.

The low prices equals either more profit or the ability to show the ad more often.

Negatives of Advertising on Social Media

Curiosity Clicks
We already know that social media users are extremely loyal, clocking in amazing amounts of page views per visit, but that could be a bad thing.

If I surf around on Facebook for an hour looking at 100 pages, I’ll see your ad more than once. At some point I might become curious about it and click on it to see what it’s about.

I had no intention of buying anything, I was just curious about the ad, and now you’ve had to pay for that. It gets worst, even though I clicked the ad you’re still targeting me. This means I’ll still see the ad, even though I’ve shown’ I’m not interested in the product.

Right now though, while ad costs are cheap, social media advertising offers a viable arbitrage opportunity for affiliates.

Ignored Ads
Most social media users tend to be pretty engaged by the site itself. This usually leaves little room to even acknowledge the ads. A recent BusinessWeek article explained how Myspace users had built up an “Ad Immunity”.

Direct marketers say only a fraction of 1% of the people who see the ads click on them. Chernin says new targeting efforts enabling marketers to deliver ads to more than 750 interest groups are bringing results. Some marketers, he says, have seen as much as a 300% improvement in response to their ads. But that increase is off the comparatively low response rates for social-network ads in general, marketers say.

This “affliction” does not only effect Myspace, but I’d say most if not all social media sites.

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Annoying and Bothersome
One of the biggest problems with social media ads is that they disrupt the conversation taking place on the site.

Imagine if you will that you’re having lunch with a friend of yours and I come along try to sell you something then get up and leave. Welcome to how the average user looks at social media ads.

Conclusion

So should you advertise on social media sites? In my opinion, no.

What works on search engines and regular web sites won’t work on social networks or other social media sites. The fact that advertising disrupts the users experience is a huge turn off, as well as the depressing CTR.

Unless your plan is to hammer in your brand (the large amount of page views help you achieve this goal), you’re better off spending your PPC budget elsewhere.

A second reason why I say no, is because most social media site give you the opportunity to advertise your product without paying for it. Why not utilize the free services Facebook and Myspace offer? Instead of spending the money on social media advertising; create a Myspace profile, a Facebook fan page, or a widget.

Social media sites need to find a way to monetize their site without interrupting the flow of conversation. What do you think? Is social media advertising viable? Is it cost effective?

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Social Media Campaign Tracking: A Basic Overview

by Samir Balwani on November 18, 2008

One of the hardest things to do is convince small business owners to invest in social media. The problem is that good social media strategies involve an investment, a payment ahead of time for a return that isn’t always accurately measurable. How do you measure good customer relations?

But for those with the insight and strength to explore new media the question still remains; what is social media doing for me?

If you’re business has an online aspect, measuring the effect is easier than for your brick and mortar brethren. Use Google Analytics to track visitors to your site. Create conversion points at contact forms, this way you know who’s sending you messages and where they came from.

For more control over your tracking install the Social Media Grease Monkey Script. It lets you differentiate social media traffic and track it separately.

To make your life even easier, Google just released a new feature called advanced segmentation. With it you can track who did what on your site, and now you can see what social media users like and don’t like on your site. To better understand how to use the feature check out this series on Advanced Segmentation.

As you can see, online stores and service providers can simply look at analytics to get an idea of how social media users are interacting with their landing page. For offline vendors this becomes harder. So how do you measure online reach in an offline world?

One way is to simply ask your clients and customers. You see this all the time on your receipts. Companies offer prizes to customers for filling out an online or phone survey. Make sure to ask people if they’ve connected with you online and if it influenced them in any way.

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Another good technique is to offer your social media friends free or discounted products. Track this with a coupon. As people use the coupon you get an idea of how many of your “friends” use your products. It also gives you a way to reward your loyal fans and generate a buzz.

The biggest difference between online and offline tracking is the need to add an incentive to the process offline. This usually means giving a discount or prize to get customers to do something.

Finding a way to track offline consumers being courted online is going to be one of the largest hurdles for social media marketers.

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Social Media: The Next Step in Marketing

by Samir Balwani on November 17, 2008

Social media is a new field. It’s relatively untested and is considered the Wild Wild West of online marketing. It’s still in its youth and because of that many businesses are afraid to take the plunge.

Not only is this an obstacle to adoption for many businesses, but the fact that social media costs are front loaded (meaning you invest up front in the hopes of turning a profit in the future) creates an even larger hurdle for many.

Recognizing that there is value in social media is a marketing first step. Business owners need to know that social media is the next evolution in marketing.

It’s next after direct mail campaigns, after tv or radio advertising, and after ads in your newspaper. Except it’s better than all of the above. Instead of the one way communication of traditional advertising, social media has made it a conversation.

No longer do you have a 30 second piece to convince consumers to use your product, but now you have a community at your disposal. Build a relationship and convince customers to stay with you and advertise for you.

However, it’s important to know that social media’s true power is not lead generation. Instead, it shines in pushing consumers along the “selling funnel”.

With all the positives of social media there come some negatives. Because of it’s youth there are very few metrics. Determining success is difficult when you consider abstract ideals like community building and branding effectiveness.

It may also be too soon to know if social media really works or if it’s just a fad. Is social media just another bubble thats about to pop?

In my opinion social media can be an powerful tool when wielded properly. A good social media strategy with built in tracking can lead to a positive ROI.

In reference to it being a fad, consider the growth and value of digg and Facebook. There’s already talk about the next generation of web users who will do almost all their surfing in a social media site whether it be Facebook or Microsoft’s new Live social network.

Social media is here to stay, and businesses and corporations better learn to leverage its power or be prepared to be left behind.

Regardless of your business size, deciding on a marketing budget that your company can sustain is an important aspect of company growth.

Small businesses that fail to invest in long term marketing projects will continue to be small businesses. A powerful branding campaign or new online community can help push a company to the next level.

Do you agree with me? Is social media marketing a fad? Is it of little use to small businesses or can this new marketing strategy work for the ma and pa store down the street? What is a good marketing budget and how much should go to online advertising? What do you think? I’d love to know.

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Is It Time to Hire a Social Media Consultant?

by Samir Balwani on November 13, 2008

Not everyone needs a social media consultant. Hell, not everyone needs social media; but it can be extremely useful and also give you a healthy return on your investment. So how do you know when it’s time to hire a social media consultant? Here are some tell-tale signs to stop trying yourself and to get an expert.

No Strategy

You know you want to increase your sales, get better branding, or create a community; but you have no idea how to do it.

A good consultant will be able to create a plan and explain it can help you leverage the web. The strategy might be as simple as creating a blog or as complex as building a social network.

No Tracking

Building a coherent social media strategy is no easy feat, but some do it without the help of a consultant. However, once they’ve implemented the plan, they realize they have no idea how to measure success.

Outsourcing your social media tracking and analytics might not only save your sanity but also save a lot of time.

The Campaign Has Stalled

You had a strategy and were following the right metrics, but where you saw growth you now see a plateau.

If your campaign has stalled, sometimes a social media expert can breathe new life into it.

You Just Don’t Have the Time

There’s a reason why there are consultants and outsourcing. As a business owner, if you tried to do everything you wouldn’t even have time to breathe.

In situations like this it makes sense to let an expert take over. Not only do you save time (you don’t have to learn everything) but the consultant bring his experience to the table.

You’d Make More Money Paying Someone Else

Time is money. In economics we call it opportunity cost. Let’s say that if you spent time managing employees or finding clients you’d make $200 an hour. If hiring a consultant, to explain how to use social media, costs $100 an hour; it makes sense to hire one.

If you hire the expert instead of trying to learn yourself, you effectively make $100 an hour plus whatever the social media campaign nets you. By saving time you save money.

If you’ve decided you need an online presence and are ready to explore social media, hiring either a consultant or agency is a good idea. The field is still young and a lot is changing. New creative ways to leverage the Internet are being explored almost daily and if you don’t have the time to dedicate yourself to it, you’ll not only waste your energy, but your money too.

I invite anyone offering social media advice to leave a comment here so readers interesting in hiring a consultant can find one. Did I miss anything? Let me know what you think.

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An Unlikely Case Study

by Samir Balwani on November 10, 2008

Watch the video then see why it’s important…

You wouldn’t know it, but this amazing song highlights how prevalent social media has become in our life.

The video was created by Kina Grannis as part of a social media campaign by Doritos called “Crash the Superbowl”. The campaign was centered around a contest where users could submit videos to potentially be featured in a Super Bowl ad for Doritos.

The Dorito’s campaign is the first part of this social media chain. By leveraging social content (inviting users to submit their own videos) they not only are able to outsource the creation of a Super Bowl ad, but they also make people feel a part of the brand.

The second part of this campaign included having “America” vote for the best video. Now, not only had Dorito outsourced the creation of the ad but also have started creating a buzz for their ad. As users submit videos they’ll ask their friends, family, and colleagues to vote for their videos. The more people that know about the contest, the more people see Dorito’s and the more people see the ad.

So already the Dorito’s campaign has shown two signs of social media. Now enter Kina Grannis.

Kina submitted a video to the Dorito’s campaign, but she also posted on YouTube. She had already built a following there, and the web savvy musician began to leverage the community to build her votes.

For those keeping track, this single campaign has already spanned three different social media websites and types.

The fourth social media aspect of this campaign is the traffic behemoth, digg. When Kina made the video about digg she had a pretty good idea that it would get a lot of attention. She was right. Not only did it bring her up to the front-page but it definitely gave her a huge spike in traffic.

With digg comes blog attention. The fifth and final part of this social media web, Kina started getting mentions on blogs for her digg song. Once that wore off they began voting for her, and when she finally won the Dorito’s campaign they wrote about “the digg girl wining the Dorito’s contest” or “how the digg girl got a record contract“.

So for businesses considering a social media campaign, use the Dorito’s strategy as a reason why you should jump in. Their plan spanned social content and social voting, but instead it pulled in YouTube, digg, and bloggers.

As the web grows more interconnected, social media strategies begin to branch out to other sites. You might only expect one thing, but people on the web can truly surprise you. All it takes is a good strategy and smart people.

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