The Social Path

Should you pull your advertising from Facebook?

General Motors is pulling $10 million in Facebook advertising, but does that mean you should follow suit? Is this one of those defining “abandon ship!” moments?

Before I answer, let me first propose that we’re asking the wrong question. It’s not about “Should I stop advertising on Facebook?” The real question is, “Should I be advertising on Facebook in the first place?”

Here at Luckie & Company, we’ve generated literally billions of ad impressions for clients on Facebook, typically at a miniscule cost compared to other media options. And what we’ve consistently seen is that Facebook ads are incredibly effective — with a few caveats. Namely, your brand has to be committed to both Facebook and creative flexibility.

General Motors is citing poor sales-related ad performance as the reason to pull its money from Facebook, and I’m sure that’s true. But those of us who deal with Facebook ad campaigns every day quickly found ourselves wondering if GM was really trying hard enough.

By audience size alone, it’s clear that General Motors has struggled to keep up with its peers, especially at the global level. Let’s look at some numbers for comparison

 

Automakers | Facebook Likes

BMW: 9,914,313

Hyundai Worldwide: 2,430,572

Honda: 2,057,104

Kia Worldwide: 1,925,231

Ford: 1,502,385

Volkswagen USA: 1,169,401

Toyota USA: 935,990

Volvo: 415,784

General Motors: 378,491

Chrysler: 298,765

Fiat: 289,134

Renault: 239,127

 

Auto Sub-Brands | Facebook Likes

Mercedes-Benz (Daimler): 7,319,676

Audi USA (Volkswagen): 5,215,038

Mini (BMW): 2,969,017

Chevrolet (GM): 1,215,242

Cadillac (GM): 1,167,853

GMC (GM): 660,359

Land Rover (Tata): 386,392

Buick (GM): 411,908

Smart (Daimler): 283,079

Acura (Honda): 173,020

 

What these comparisons show us is that GM has been a respectable player in the Facebook marketing space, but clearly not a leader. The automaker admitted as much when it fired its social media ad agency in December (read more here), after which the agency complained that GM never understood the value of social media as place to build brand instead of just racking up sales.

So let’s get back to the real question: Should YOU pull your ads from Facebook? Or maybe kill that big campaign you had in the works?

Probably not.

Facebook ads remain tremendously effective (compared to the alternatives) at driving awareness and audience growth within Facebook. True, Facebook is saturating a bit, making it tougher for brands in lots of ways. More businesses are competing for limited ad space, and consumers are becoming jaded by the tedious and unexciting ads they see stripped down the side of each page.

Looking at the numbers

I had our agency's Facebook ad guru, Keith Browder, crunch some comparison numbers to see if Facebook is really losing its punch as an ad forum. Here’s what he found:

Comparing a Facebook campaign we’re running now to a similar one we ran this time last year, we’ve seen the click-through rate (CTR) rise from .04% in 2011 to .07% in 2012. Those numbers might sound low, but with the staggering number of ad impressions Facebook generates, it’s really not bad at all.

And while this case study sounds like good news for Facebook, it probably says more about our agency's ability to tweak creative and improve our targeting to yield better results.

Things are a bit less rosy on two other fronts: cost per Like and cost per thousand impressions (CPM). There, we saw the cost of new Likes rise from $1.30 each in 2011 to a number that hovers between $1.48 (for Sponsored Stories) and $2.75 for display ad units.

The nice thing about Facebook is that we can, at any time, adjust the current campaign to bring our costs down and increase our effectiveness. That’s a time-consuming process that requires experience and expertise, but it’s the only way to ensure your Facebook campaigns are consistently effective.

Apples, Oranges, Google and Facebook

Many pundits are using GM’s exit from Facebook as a reason to compare Facebook ads side-by-side with Google’s ad options. But any social media savvy marketer know that this is a real apples-and-oranges debate.

Google has a myriad of ad options ranging from search and mobile to YouTube pre-rolls and Google+ Circle targeting. Facebook, on the other hand, has Facebook ads, which have notoriously (and intentionally) few bells and whistles. Facebook has never wanted to be seen as primarily an ad platform, though Wall Street investors are sure to disagree once the stock goes public.

So in summary, if Facebook is important to your business, by all means keep advertising on Facebook. But keep some of these tips in mind:

• Facebook ads can’t be your only growth strategy. Ensure that your business’ page is being promoted on your products, in stores, on traditional ads or anywhere else you can reach your audience. And sure, try some Google search ads and see how they perform as a driver to Facebook, not just your home page.

 • Be flexible. If your Facebook ads aren’t working, try something else. Change your targeting. Change your creative. Kill the ads that aren’t working and enhance the ones that are. Are you wasting money on audience-growth ads that hit existing fans? Are your thumbnail images cluttered and confusing? Are your headlines saying anything worth acting on? Be hard on yourself and set aside the time to treat your campaigns with professional diligence and creativity.

• Keep people within Facebook. The best ad units offered by Facebook are those that generate Likes, not click-throughs. So focus on Sponsored Stories, Like ads and display ads that explain the benefits of becoming a fan. It’s worth experimenting with Facebook advertising as a driver to your website, but I doubt you’ll find it to be the best option. Instead, focus on building and engaging your audience, then producing content that fans the flames.

And remember, no ad medium is ineffective by nature. Dismissing an entire outlet, whether it’s Facebook or radio or rich media, is just a cop-out. Think about what you’re trying to accomplish, then find the right tools for the job. From this perspective, the recent ad flap may say more about General Motors than it does about Facebook.

David Griner is the VP/Director of Digital Content for Luckie and Company and contributing editor for Adweek’s blog, AdFreak.com. You can reach him by e-mail or on Twitter.

Photo credit: H Aoki on Flickr.

A new metric for ad success: Keeping eyes away from apps.

This past Sunday, I once again had the pleasure of being the "voice of AdFreak" on Twitter, as I live-tweeted about the Super Bowl ads for Adweek's blog. (I also made occasional contributions to the magazine's Super Bowl liveblog itself, which you can read a transcript of here.)

Amid the frenzy of tweeting about ads in real time, I became hyperaware of how the game and its celebrated commercials kept or lost my attention. When the game grew dull, I was able to cram in more online updates. When a great ad surfaced, I stopped typing and stayed glued to the screen.

I wasn't alone, as you can see in the chart above from analytics service Flurry, which tracks data from more than 160,00 iOS and Android apps. The graph shows how many mobile apps were being opened during every second of the game.

For example, during downtime, smartphone users would fire up the Twitter or Facebook apps to see what friends were saying. When the game got intense (or Madonna took the stage), phones went dark and the TV took hold.

Certain ads obviously drew in viewers. I was one of the millions who couldn't look away from the mysterious movie trailer that ended up being for the board game-inspired "Battleship." Coke's polar bears kept people away from their phones, as well.

There's so much insight to be gleaned from this data, though mostly it just illustrates two points:

• Major television events have become national social experiences, giving us all something specific to talk about. Short of major world events, what else these days brings together so many diverse voices into the same conversation? Whether it's the Grammys or big game, TV's biggest moments are unparallaled in their ability to get people talking in real time.

• Attention comes at the cost of discussion. This creates a tough challenge for the entertainment industry. You want your TV show to be a nationally trending topic on Twitter while it's airing, but you also want viewers paying attention, right? A viewer's natural inclination will be the chat during commercial breaks, which means there's never been more pressure on advertisers to keep eyeballs on the screen and off the phone for just a few more seconds.

Which leads us to another fascinating implication of this data: We might be witnessing a new metric for TV ad performance. Most advertisers simply look at a program's audience size and claim the impressions as their own. But this chart clearly shows that attention waxes and wanes, even if the audience never leaves the room.

Will your favorite brand's next TV ad be enough to keep people engaged, or will audiences find their eyes drifting down to the dreaded second screen?

David Griner is the Director of Digital Content for Luckie and Company and contributing editor for Adweek’s blog, AdFreak.com. You can reach him by e-mail or on Twitter.

The Super Bowl Ad Awards: Honoring the most memorable commercials.

It's awards season and Super Bowl week, making it the perfect time to present our own honors for Super Bowl ads! In an effort to get the most out of their millions of dollars, companies go to great lengths to win the Super Bowl ad wars with most suggestive, adorable, heartfelt, and funny  commercials they can produce. Many of these are so good (or bad) that they stand head and shoulders above the rest in their respective categories. Join me as we honor the best the Super Bowl has to offer.

Most Innuendo-Packed Ad

Ahhh, the '70s. Arguably the first famous Super Bowl ad, this Noxema commercial starred the one and only Farrah Fawcett and possibly the most charismatic football player ever, Joe Namath. There's very little script, mostly just Farrah and Broadway Joe saying "creamed" over and over again. No obscenity, no skin, just enough creepy dialogue to give you the giggles. Simple, suggestive and effective. Go Daddy can only dream of being this brilliant.

The Most Annoying Trend Caused By A Super Bowl Ad

Admit it, you've said it. We've all said, and it was hilarious for roughly 15 minutes. Since it's been awhile since we've heard it, maybe it's poised for a comeback ... "WASSSSSSSSSUU..." Nope. Still annoying.

Ad Most Likely to Ruin A Company

What was once one of the largest athletic shoe retailers in America met a swift death thanks to one ill-fated Super Bowl ad. A short 11 months after this disastrous 1999 ad from Just For Feet, the company filed Chapter 11 bankruptcy and closed their last store in 2004.

Facebook officially kills Deals after downgrading Places. Will geotargeted mobile ads fill the gap?

UPDATE: Since we posted this Friday, Reuters and other news outlets have clarified that it is Facebook's Daily Deals offering (a la Groupon) that is now being phased out, not the Check-in Deals (a la Foursquare). It remains a bit unclear how Check-in Deals will continue or evolve, but since much of the commentary below is still valid, I've decided to leave the original post up:

Well, Facebook's short-lived attempt to compete with Foursquare in the check-in space is officially over.

As you might have heard, Facebook dropped the "check-in" aspect of Facebook Places from the social network's mobile app this week. Now Reuters is reporting that Facebook will be shutting down its related Deals product "in the coming weeks."

It's easy for all this to sound like a public defeat for Facebook — and it is, in the sense that they tarnished their brand by launching a lackluster check-in tool to begin with. The site also lost some goodwill from socially savvy marketers who tried using Facebook's check-in Deals, which were riddled with glitches. (In a recent campaign run by my team featuring Deals at 300 locations, the check-in offer went unclaimed due to glitches a staggering 95% of the time.)

But Facebook isn't giving up on location-based marketing. In fact, the site's leadership deserves credit for admitting they had a flawed product, pulling it, and choosing to focus on the next iteration of how location can be folded into online activity.

Here's a nice summary of the change, via MediaPost:

"This is not a retreat in any way," said Michael Nicholas, chief strategy officer at Aegis Group's Isobar. Rather, the move is essentially an "embedded tag strategy that's about getting more people to put more location data into Facebook." Instead of a single mobile feature where users have to manually check-in, he added, "they're putting location into everything."

The real question, of course, is how Facebook will allow marketers to make the most of this location data. My hunch is that it will be tied directly to the one marketing tactic that has been noticeably missing: mobile versions of Facebook ads.

Given that more than 50% of smartphone owners are checking Facebook at least daily, you can bet that Facebook wants to make money off this massive audience. Using location data to serve up geotargeted ads could be the perfect solution.

David Griner is the Director of Digital Content for Luckie and Company and contributing editor for Adweek’s blog, AdFreak.com. You can reach him by e-mail or on Twitter.

The Super Bowl: Now playing on three screens.

A diehard Green Bay fan will be watching the Super Bowl.  A commercial comes on.  After watching, another one airs, but this one doesn’t interest him, so he pulls out his mobile phone while walking to the kitchen to get another plate of wings, typing in a URL or becoming a “fan” of a product he just saw advertised. Then, he sends a text message to his buddy in Pittsburgh to share the experience, along with a healthy serving of trash talk.  In Pittsburgh, his buddy goes online and Googles the advertiser.  He find the website along with the Facebook site, Twitter, campaign sites, etc.

TV. Mobile. Text. Search. Web.

All while getting a plate of wings.  Welcome to Super Bowl XLV, a marketer’s Shangri-La.

It has been happening for years now, but in the current marketing environment we are seeing an emphasis on digital media on behalf of advertisers.  Examples like the scenario above are the reason marketers will be using their big-budget Super Bowl spots as a springboards to digital experiences in social, mobile  and Web.  Why?  Because this will create an ongoing and transferrable relationship with the brands which will extend far past the game.  Marketers know that in order to remain relevant, they need to create an experience that will include three screens - TV, mobile and PC.

So how will those watching the Super Bowl see evidence of this? It may be obvious to some but routine for others.  When watching ads this Sunday, they will find themselves being driven to destinations outside the norm.  They will be pausing their DVRs looking for hidden codes, texting numbers to enter sweepstakes, tweeting in order to effect the outcome of the next spot and telling their friends about it the whole time.  Marketers are relying on consumer behavior and their use of digital technologies to help tell a story that is seamlessly intertwined into the game experience.

But with all the great emerging ways to reach consumers, the one true thing marketers need to keep in mind is to be relevant.  Consumers are smarter than ever.  Developing a marketing architecture that manages to convey the right message in the right medium is the challenge, but the reward is creating an immersive campaign experience that feels as natural to the consumers as getting up from the couch for that second plate of wings.

Chris Zobel is Director of Digital Strategy at Luckie & Company. You can contact him by e-mail.

Photo credit: CarrieA on Flickr

Mobile is crushing online in ad effectiveness.

Here at Luckie, we recently invited mobile analyst Joy Liuzzo from Insight Express to come share her thoughts on trends and technology. While she had a lot of fascinating insight to share, here's a slide that really blew me away:

Essentially, this chart shows that — based on three years' worth of research data — mobile advertising is twice as effective as online advertising when it comes to ad awareness, and a whopping six times more effective in the "holy grail" category of purchase intent.

Later in the presentation, she sliced it even thinner, showing that for the retail sector specifically, mobile ads were 14 times more powerful than online in the area of aided awareness and 8 times more effective in purchase intent.

I was simply flabbergasted by these numbers, so I followed up with a brief Q&A asking Joy to help put these findings into context. Check out her responses after the jump:

Making sense of Twitter's new advertising crackdown.

In a long-winded and circuitous blog post today, Twitter’s COO announced that the social network is banning third-party services that insert ads into users’ streams.

The decision is a kick in the collective crotch for in-stream ad businesses like Ad.ly, 140 Proof (shown at right) and Sponsored Tweets, which pay users to post occasional commercial messages or partner with applications to drop ads into the tweet stream.

It’s also a sign that Twitter is getting serious — after a mere four years — about monetizing their own service instead of just watching while everyone else milks their cow. The relatively new, official ad service of Promoted Tweets will now have a lock on in-stream advertising.

What Twitter said:

I’ll spare you the 611-word introduction (kid you not) to Twitter COO Dick Costolo’s blog post and skip right to the key points:

“Aside from Promoted Tweets, we will not allow any third party to inject paid tweets into a timeline on any service that leverages the Twitter API. …

“Why are we prohibiting these kinds of ads? First, third party ad networks are not necessarily looking to preserve the unique user experience Twitter has created. They may optimize for either market share or short-term revenue at the expense of the long-term health of the Twitter platform. …

“Secondly, the basis for building a lasting advertising network that benefits users should be innovation, not near-term monetization. Twitter is uniquely dependent on and responsible for the long-term health and value of the platform. Accordingly, a necessary focus of Promoted Tweets is to explore ways to create value for our users.”

Personally, I find this to be a less compelling argument than if he had simply said, “It’s our service, we pay the bills, and we want to be the ones making money from it.” I think we'd all agree that's fair.

Who does this affect?

The biggest problem here isn’t Twitter’s decision; it’s the length of time it took for Twitter to make the decision. By taking a laissez-faire stance on advertising for so many years, Twitter’s execs tacitly gave companies and users the green light to create their own ad opportunities.

Had Twitter made this decision in 2008, it probably wouldn’t have hurt much of anybody. But this late in the game, it comes as a heavy hit to several businesses and takes away a modest revenue source from many users and app developers who’ve signed up to automatically distribute the ads.

All that said, it’s hard to get too upset about a decision that reduces the number of ads we have to see in a day. Also, the Twitter execs deserve credit for being otherwise accommodating to most businesses profiting off their service.

Even Sponsored Tweets, part of the Izea network of paid social media content, seems optimistic its advertisers and users can remain active on Twitter. As I was writing this post, Izea CEO Ted Murphy published his take on what kind of promotion is still kosher:

“You can still tweet about our sponsors. You can still promote your employer. You can still drive traffic to your blog. You can still share amazon affiliate links. You can still use your account to tweet out deals. You still have freedom to do what you like with your Twitter account, so long as you aren’t a spammer.”

Murphy hopes that turning off his service’s “direct publishing” feature will be enough to comply with Twitter’s new rules, though I’m not so sure. Ad service 140 Proof also has posted a quick response, which basically just says "no comment."

If you’re in the advertising field, now’s a good time to brush up on Twitter’s constantly evolving guidelines on commercial use.

It’s also a good time to start thinking about Twitter’s upcoming Annotations feature, which could help users interconnect more intricately than ever before. Costolo feels this addition alone will spark the creation of many new companies, ones which can hopefully live in peaceful co-existence with a Twitter that’s finally behaving more like a tech industry leader and less like a nonprofit.

David Griner is a social media strategist for Luckie and Company and contributing editor for Adweek’s blog, AdFreak.com. You can reach him by e-mail or on Twitter.