Further Proof Social Media Provides ROI – study finds
There has been a lot of public discussion over recent years about ROI on social media, with many blaming a lack of decent analytics for any issues surrounding how it’s measured.
However, new research for the Internet Advertising Bureau UK (IAB UK) has helped to justify the merits of going social. The report has backed up professionals in the industry justifying that social media is effective “at driving a brand sentiment”, social also enhances engagement, increases loyalty and generates of potential ROI of over 3:1. Pretty impressive stuff.
The IAB UK, which is a trade association for digital advertising, looked at a total of more than 4500 quantitative survey responses, 800 research panel interviews and the social media pages for three leading brands.
4 out of 5 customers buy
The research was carried out over a period of 8 weeks and was intended to assess the impact of social at various stages in the purchase funnel.
Of those consumers who connected to a brand through social media, 4 out of 5 of them said that they would be more likely to buy following exposure to a brand’s social presence.
83% of those asked said that they would trial a brand’s product after seeing the brand on social. Of the brands studied, all three experienced an “uplift in sentiment after implementing their social media campaigns.”
For leading food brand Heinz, this rose by 22%, whilst for tea company Twining, it was 19% and 17% for Kettle, who produce snack foods such as crisps.
£1 advert = £3.34
According to the IAB UK, this means that for every £1 spent on social advertising, brands could see a potential value of £3.34, so the investment triples the return. It was also found that regular posts about new products significantly increased incentives to trial the products.
This was demonstrated during the study by Heinz Beanz’s promotion of new product ‘Snap Pots’
“In the case of encouraging trial for a newer product line, frequency becomes even more important to support the new concept, as the IAB study illustrates,”
commented Ian McCarthy, Heinz’s Marketing Manager. Ian Ralph, who carried out the research, said that social turns customers into brand fans, commenting:
“By making people love, not just like your brand, you’re more likely to drive future purchases and increase sales.”
However, an industry watchdog said that it’s not enough to measure social media success just by using the easy metrics, such as likes, retweets, shares and so on. Bryan Urbick of the Consumer Knowledge Centre referenced a recent social campaign carried out by Pepsi.
When looking at tweets, retweets, likes and shares, the campaign for the soft drink manufacturer seemed to be a success on the surface of things. However, Pepsi lost 2.6% of the US market whilst the campaign was running.
This flags up the dangers of using standard social metrics in order to measure engagement and it’s advisable that professional marketers and advertisers use tools that can provide deeper insight.
It’s also wise to measure traffic to the company website and converted sales from each campaign, in order to gain a clear insight. Whilst plenty of tools are becoming available, social advertising is still such a young discipline that many companies don’t know how to effectively measure ROI.
Bearing this in mind, it’s a good idea to thrash out a sound strategy before the advertising is embarked upon. Like any marketing discipline, it has to first be ascertained if social will have as much impact as other campaigns.
This of course depends on the nature of the business, as all companies have different needs when it comes to marketing, especially that of digital.
However, the research provides a positive outlook for digital marketers, as it provides further proof of the fact social DOES provide return on investment.