Sunday, 15 March 2009

Social Media Monetisation and equivalent media buy

There has been much talk on how to monetise social media marketing techniques. The amount of speculations does seem warranted based on the industry figures associated with social media marketing and the vast amount of money that potentially is up for grabs.

  • Growing at a rate of 2:1 over other internet activity
  • Second most trusted source of brand information
  • Video growing at 50% year on year
  • Video based marketing enjoys higher CTR
  • Digital budgets grow while print, radio and TVC shrink
If you operate a social media platform (e.g. Facebook or Twitter) the answer may be a bit foggy. But if you are an social media marketing agency the answer is clearer; equivalent media buy!

When discussing the costs and advantage of social media compared to other online strategies it is often about comparing apples to oranges. Social media is about engagement and consumer content, whereas paid search and display ads, SEO and SEM work differently. Making the argument for the benefit of social media can sound a bit esoteric when the bottom line is at stake.

However, if you engage in a results based discussion
  • Search engine results
  • CTR
  • Conversion
then an apple to apple comparison can be made against existing SEO, SEM, paid search and display ad budgets. So sell social media's clear advantage over traditional and familiar online marketing strategies where you can capture existing budget by proving equal or improved results instead of attempting to sell the "unknowns" of social media. Once the sale has been made then the additional value of social media will become immediately clear and evident and will sell itself going forward.

Prosperity Research has activated hundred's of social media campaigns and a summary of the finding shows a cost comparison against paid search and displays ads as:

Social medial campaigns average about US$ .12 per view/ click
Industry rates of .1% CTR for display US$ 1.25 per click
Average cost of key search term in 3-6 space US$ 1.00

In summary, our survey of campaigns based on apple to apple comparison of results show that social media costs can be significantly less than traditional forms of online marketing.

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