Social Media Advertising: In-Depth Guide and Proven Tips (2023)

What is social media advertising?

Social media advertising is a type of digital marketing strategy that uses social networks, such as LinkedIn, YouTube, Facebook, X (formerly Twitter), TikTok and Instagram, to deliver paid ads to your target audience.  

A social media ad campaign is a quick and effective way to communicate your value proposition to your prospects and improve your brand recall. You can even hyper-target your audiences and deliver personalized content using data and analytics. Social media ads are also cost-effective, offering a great return on investment compared to traditional advertising channels. 

More and more companies — including the world’s top-performing brands — rely on social media ads to grow their business and attract prospective customers. Therefore, to keep up with your competition, it’s important to understand the nuances of social media advertising and incorporate social ads into your social media and content marketing strategies.

Social media advertising statistics

From increased brand visibility and engagement to higher conversion rates, these numbers provide some valuable insights on why so many businesses have increased their investments in social media advertising.

1. Market size:

• Ad spending in the social media advertising market is projected to reach US$1.28 billion in 2023.

• Mobile advertising spending is expected to reach a record US$399.6 billion worldwide in 2024.

• In digital advertising market, social media advertising ranks as the second largest segment. It generated US$226 billion in revenue in 2022, and experts predict it'll grow even higher, reaching a figure of US$385 billion by 2027.

2. Discoverability:

• 26.8% of internet users aged 16 to 64 discover brands, products and services via ads on social media.

• As a marketing strategy, 77% of marketers utilize retargeting in their Facebook and Instagram advertising efforts.

• The average click-through rate (CTR) for social media ads was 1.2% in first quarter of 2023.

So, if you're still unsure about investing in social media advertising, think again.

How does social media advertising differ from SMM? 

Social media marketing (SMM) refers to the practice of businesses using social media websites and apps to showcase their product and/or services. It entails creating and publishing content on social media to accomplish your various marketing and branding objectives. Simply put, social media marketing helps you promote your brand, engage with customers and even incorporate user feedback into your marketing strategy.

SMM primarily involves content creation, audience and community engagement through comments, user-generated content and social care efforts. It rarely involve direct monetary investment, rather it relies on the creativity and consistency of posts to improve reach and engagement.

Also Read: Impact of social media marketing on businesses

On the other hand, social media advertising is a paid marketing approach (pay-per-click) where businesses allocate a certain portion of their marketing budget to create and run ads on social platforms. These ads can be highly customized to reach specific audience segments.

Social media advertising ensures you have precise control over ad placement, timing and audience segmentation. Unlike SMM, which relies on organic growth, social media advertising delivers immediate visibility and can be optimized for various objectives, such as lead generation, website traffic or product sales.

Both SMM and social media advertising are integral components of a comprehensive social media marketing strategy, with each serving distinct purposes in reaching and engaging the target audience.

Benefits of social media advertising

Whether you're aiming to catch the eye of tech-savvy teens on TikTok or make a mark with trendy millennials on X, your success lies in developing a tailored social media advertising strategy. Doing so will help you with the following:

1. Achieve a wider reach

With social media ads, you can cast a wide net, helping you reach not just your current followers but also potential customers who meet your demographic criteria. This means your brand can break into new markets and expand its reach in ways that traditional advertising might struggle to match.

2. Refine your target audience

Reach your ideal target audience — potential leads who have visited your website, customers who have previously purchased from your brand and prospects who are interested in your brand’s products or services — with ease. Yes, layered targeting helps you target your audience with pinpoint accuracy. Whether it's age, location, interests or online behavior, you can customize your ads to reach the right people at the right time.

3. Improve engagement

Social media platforms are all about interaction. When you run ads, you're not just publishing yet another content. You're creating opportunities for meaningful engagement with your audience. Whether it's likes, comments, shares or clicks, social media ads encourage your audience to act and connect with your brand.

4. Attain measurable business outcomes

One of the standout benefits is the ability to track and measure your ad performance in real time. You'll know exactly how many people saw your ad, clicked on it and even made a purchase. Along with this insight, you can also gauge how different ad elements like content, design and call to action perform. Thus, providing you with the necessary data to fine-tune your campaigns for optimal results, saving you time and money.

5. Save a considerable amount of money

Social media advertising costs a fraction of what you generally spend on traditional advertising methods. You can set your budget upfront; most social platforms offer flexible options to help you make the most of your investment. This affordability has made social media advertising a popular choice for businesses of all sizes.

Let's now explore the nuts and bolts of social media advertising.

How does social media advertising work?

When it comes to social media advertising, four components reign supreme: goals and objectives, audience targeting, ad creatives, and bidding and budgeting. These components are the building blocks of any successful campaign, allowing you to connect with the right audience, craft compelling social media message and manage your budget effectively.

Understanding how these elements come together is the key to harnessing the full potential of social media advertising.

1. Campaign goals and objectives

Let’s say your goal is to boost brand awareness, your objective might be reaching a million people with your ad within a month. Or if your goal is to sell more of your new product, your objective could be achieving 1,000 online sales in the next two weeks.

These campaign goals and objectives serve as your guiding star, helping you shape your ad content, targeting and budget to align with what you want to achieve. They make sure you stay on the right track and measure your success along the way. Therefore, establishing the right goals is essential for a successful social media advertising campaign.

2. Audience targeting

Audience targeting is all about finding the right audience for your product or service in a crowded room. On social platforms, you can narrow down your audience based on age, location, interests and even behaviors.

For example, let’s say you're a fitness brand selling high-protein snacks. Your target audience are health-conscious individuals who enjoy an active lifestyle. Instead of trying to reach everyone, you can use audience targeting to show your ads specifically to people interested in health, fitness, nutrition and other similar topics. This way, you can make sure your message reaches only those most likely to purchase your product.

3. Ad creatives

An ad creative is the combination of visual and text elements of an advertising campaign, intended to grab your audience's attention and persuade them to take a desired action.

The choice of ad format depends on your brand messaging and goals. For instance, if you want to communicate an elaborate story, a carousel ad is the right choice. If you're looking for quick engagement, a simple image ad can do the trick. The key is to craft an ad with compelling assets that resonate with your audience, whether you're aiming to inspire, inform or entertain them.

You also have the option to run multiple versions of the same ad, each featuring different creatives, This allows you not only to determine what's working but also to engage with various audience segments within a single ad campaign.

4. Bidding and budgeting

Bidding and budgeting determine how much you spend on your ads and how effectively your ads reach your audience.

For example, if you're running an ad to sell your latest smartphone, you might bid $2 for each click on your ad. If your daily budget is $20, your ad will be shown until you've spent that amount for the day.

The key here is to strike a balance between your bid and budget to make sure your ads get enough visibility without overspending. You may have to manage your finances wisely to get the most out of your social media advertising efforts.

As we dig deeper into the nuances of social media advertising, a pivotal question arises: which platforms hold the key to your brand’s advertising success in 2023?

Don’t worry about Googling it. We've done the legwork for you.

Best platforms for social media advertising

The most popular social media platforms for advertising are, unsurprisingly, the same as those for organic marketing.

1. Facebook (FB)

With over 2.27 billion monthly users, FB’s popularity is at an all-time high! And with options to create and target ads with its Ads Manager, it's always been the go-to platform for most brands. And the interesting part? You can use your customer database to reach out to them with upsell and cross-sell campaigns on the platform and even target prospects who've only visited your website and not interacted with your FB page.

• Largest FB users’ age group: 25-34 (29.9%)

• Duration of FB users' daily engagement: 30 minutes

• 93% of social media advertisers use Facebook Ads

Pros:

• Massive reach and diverse audience

• Precise targeting options

• Comprehensive ad formats, including video, carousel and more

Cons:

• Increasing competition can raise ad costs

• Ad fatigue among users

• Privacy concerns

Key takeaway:

FB remains a top choice for social media advertising due to its massive user base and versatile ad formats. However, you should carefully manage your budget and focus on creative, engaging content to stand out.

2. X

X is a social media platform renowned for its real-time updates and microblogging features. It’s fast-paced, trending and perfect for companies dropping fresh content and updates about almost everything regularly.

• Number of daily active users: 237.8 million

• Largest age group: 18-29 (42%)

• Duration of daily engagement: 34.8 minutes

• 41% of Twitter Users Intended to purchase based on a tweet

Pros: 

• Real-time engagement with a global audience 

• Effective for brand awareness and trend-based marketing 

 Cons: 

• Limited character count for ad copy 

• Fierce competition for trending topics

Key takeaway:

X should be your go-to platform if you’re aiming to engage in real-time conversations and leverage trending topics for advertising.

Also read: X, formerly Twitter Advertising

3. YouTube (YT)

Everyone knows YT as a popular video-sharing site but it’s also perfect for showcasing company culture and for creating how-to videos and demos. You can either embed your marketing videos and advertisements on your website or let users access them directly from your channel on the platform. 

• Number of monthly active users: 2.1 billion 

• Largest age group: 15-35 (highest reach) 

• Duration of daily engagement: 45.6 minutes 

 Pros: 

• Massive reach and diverse audience 

• Video ads have the power to captivate and resonate with viewers 

• Offers detailed targeting options for effective ad placement 

• Advertisers gain access to comprehensive analytics to measure ad performance 

 Cons: 

• Ad skipping: With TrueView ads, users have the option to skip ads after a few seconds. 

• The platform is highly competitive, especially in popular niches

Key takeaway:

With the right strategy and compelling ads, you can drive brand awareness, engagement and conversions on this influential platform.

4. Instagram

Owned by Facebook, it offers similar ad options. Instagram is where you can go all out and flaunt your brand's personality. It's great for sharing snazzy product images and short videos. Plus, with hashtags, stories and live videos, you can reach a broad cross-section of your target audience.  

• Number of monthly active users: 2 billion 

• Largest age group: 18-24 (30.8%) 

• Duration of daily engagement: 30.1 minutes 

• Over 200 million Instagram users visit at least one business profile every day, emphasizing the platform's value for brands. 

• Meta's survey shows that 200 million Instagram users check out business profiles daily. And 80% of the users rely on Instagram to decide whether to buy a product or service. 

Pros: 

• Ideal for visual brands 

• Strong engagement with younger audiences 

• Integration with Facebook's ad platform for seamless management 

Cons: 

• Increasing competition for ad space 

• Limited link placement options in posts

Key takeaway:

Instagram should be your prime choice if your brand is known for visually appealing products or services. Engaging visual content and a clear brand messaging are key to advertising success here.

5. LinkedIn

This is a social network meant for working professionals. From a brand perspective, it’s perfect for sharing company updates, recruiting top talent and connecting with industry peers. This platform is tailor-made for B2B marketers who are looking to generate quality leads. 

• Number of members: 930 million 

• Largest age group: 30-39 (31%) 

• LinkedIn continues to be a popular forum for job seekers, with 52 million candidates using the platform weekly to look for opportunities 

Pros: 

• Excellent for B2B and professional services 

• Offers a wide range of targeting options  

• High-quality lead generation 

Cons: 

• Higher cost-per-click (CPC) compared to other platforms 

• Smaller overall user base 

 Key takeaway:

LinkedIn is a powerhouse for B2B advertising, making it an essential platform for businesses targeting professionals and decision-makers.

6. TikTok 

 Last but not least, TikTok has over 689 million monthly users and the platform is famous for its short, quirky videos. From viral dance tutorials to quick product unboxing, it's a great place to make your brand appealing to the Gen Z crowd by showcasing the fun side of your brand.  

• Largest age group: 18-24 (21%) 

• Duration of daily engagement: 45.8 minutes 

• According to a 2023 Statista study, 38% of TikTok users don’t consider ads as a deterrent. They are fine with having ads in exchange for free access to specific services.  

• Millennials lead the charge on brand engagement: They are 2.3 times more likely to create posts and tag brands on the platform. 

 Pros: 

• Engages younger audiences 

• Creativity is encouraged 

• Higher chances of your content going viral 

 Cons: 

• Competing with the abundance of user-generated content 

• Limited targeting options compared to other platforms 

 Key takeaway:  
TikTok has evolved from its status as an "emerging platform" to becoming firmly established, showcasing immense potential for the execution of creative and engaging advertising. If you’re targeting the Gen Z crowd, then you should be present on the platform.

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Tip: To manage your social media advertising campaigns from a centralized dashboard, check out the best social media management tools for higher ROI

Cost of advertising on social media platforms

The actual cost of advertising on popular platforms varies widely. It depends on factors like the platform, your target audience, ad format, and competition. By gaining insights into these costs, you can strategically allocate your budget and make the most of your marketing efforts.

So, on average how much does it cost to get your ads out there on popular platforms?

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1. Facebook advertising costs

Facebook advertising costs can vary widely based on ad objective, audience targeting, ad placement and competition within your chosen audience segment.

The four primary cost structures are:

• Cost per click (CPC): You pay each time someone clicks on your ad. The CPC can range from a few cents to several dollars, depending on factors like industry competitiveness and audience targeting.

• Cost per mille (CPM): This model charges you per 1,000 impressions (views) of your ad. CPM rates can vary greatly, often influenced by factors like ad format and audience targeting.

• Cost per like (CPL): You pay for your ad when someone likes your business page.

• Cost per action (CPA): You pay for your ad when someone converts.

Source 

The costs of Facebook advertising are influenced by demand and supply dynamics.  

For instance, during peak advertising seasons or for highly competitive demographics, costs tend to rise. Advertisers must optimize their campaigns to ensure cost-efficiency while achieving their campaign objectives. Ad relevance, targeting precision and ad creative quality are crucial factors in controlling advertising costs on Facebook.

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2. Instagram advertising costs

The cost of Instagram ads can fluctuate, typically ranging between $0.20-2.00 per click.

However, these costs are influenced by several factors, including the pricing model you choose. If you prefer to pay only when users interact with your ad, you can opt for Instagram ads using the CPC model.

In this case, the cost per click may go up to $3.00. Alternatively, if you choose the CPM model, you'll be charged around $7.00 for every thousand impressions your ad receives. The pricing model you select should align with your campaign goals and budget strategy.

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3. YouTube advertising costs

The primary cost structures for YouTube advertising are CPC and cost per view (CPV).

The average CPC on YouTube can vary widely, ranging from $0.10-0.30 or more. For instance, if you're running a video ad promoting a cooking class and your CPC is set at $0.20, you'll pay $0.20 for each click that leads to your website or video.

With CPV, you're charged when a viewer watches a significant portion of your video ad. YouTube considers a view when a viewer watches at least 30 seconds of your video (or the entire video if it's shorter than 30 seconds) or interacts with your ad, like clicking on a call-to-action overlay. CPV rates can range from $0.01-0.15 per view.

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4. LinkedIn advertising costs

The primary cost structure on LinkedIn is CPC.

The average CPC on LinkedIn can range from $2-7 or more, depending on factors like audience targeting, competition and ad quality. For instance, if you're running a campaign to promote B2B software services and set a CPC bid of $3, you'll be charged $3 every time someone clicks on your ad.

LinkedIn advertising costs are notably influenced by factors such as audience targeting. If you're aiming to reach a specific niche audience, your CPC may be higher due to the limited availability of such audiences. To optimize costs, advertisers should focus on refining their targeting parameters, crafting compelling ad content and testing different ad formats. Understanding these cost dynamics is essential for planning a cost-effective LinkedIn advertising campaign tailored to your specific objectives.

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Different types of social media ads in 2023

Below are the different types of social media ads. These ad types cater to various campaign goals and audience preferences across platforms.

1. LinkedIn 

• Sponsored content: Promote your company updates, articles and posts to a targeted audience 

• Sponsored InMail: Send personalized messages to LinkedIn users' inboxes 

• Display ads: Display banner ads on the platform 

• Dynamic ads: Automatically personalize ads based on user profiles

2. Facebook

• Image Ads: Simple image-based ads in users' feeds

• Video Ads: Promote video content, including in-feed and Stories

• Carousel Ads: Showcase multiple images or videos in a scrollable format

• Messenger Ads: Appear in users' Messenger conversations

3. X 

• Promoted tweets: Boost your tweets to a wider audience 

• Promoted accounts: Increase your account's followers 

• Promoted trends: Place your hashtag in the trending section 

• In-Stream video ads: Short video ads within users' feeds 

 4. Instagram 

• In-Feed Ads: Image or video ads within users' feeds 

• Stories Ads: Full-screen vertical ads within stories 

• Carousel Ads: Users can swipe through multiple images or videos 

 5. Snapchat 

• Snap Ads: Full-screen, vertical video ads 

• Sponsored Lenses: Interactive augmented reality (AR) ads 

 6. TikTok 

• In-Feed Ads: Short video ads in users' feeds 

• Branded hashtag challenges: Encourage user-generated content 

• Branded effects: These effects are highly customized, with brand logos and other branding elements, to fit your specific campaign needs

7. Reddit 

• Promoted posts: Display ads in specific subreddits 

• Video Ads: Promote video content to Reddit users 

• Award Ads: Encourage user engagement with award-based ads 

 8. Pinterest 

• Promoted pins: Image-based ads that appear in users' search results and feeds 

• Shopping Ads: Showcase products with pricing and availability 

• Carousel Ads: Multiple images in a scrollable format

Steps to run a social media advertising campaign

Crafting a successful social media advertising campaign involves a strategic journey with well-defined steps. Whether you're looking to boost brand awareness, engage your target audience or drive conversions these essential steps will guide you through the process ensuring your campaign is both effective and impactful.

Step 1: Define clear objectives

Begin by defining your campaign's specific goals. Are you aiming to boost brand awareness, generate leads, drive website traffic or increase sales? Having clear objectives will guide your campaign strategy.

Step 2: Know your target audience

Conduct thorough audience research. Understand their demographics (age, gender, location), interests, and online behaviors. This information helps you create content that resonates with your target audience.

Step 3: Choose the right platform

Select social media platforms where your target audience is most active. For example, if you're targeting professionals, LinkedIn might be more effective than TikTok.

Step 4: Create compelling content

Craft ad content that captures attention and conveys your message effectively. Whether it's eye-catching visuals, persuasive copy or engaging videos, ensure your content aligns with your campaign objectives.

Step 5: Set budget and schedule

Determine how much you're willing to spend on your campaign and the timing of your ads. Consider daily or lifetime budgets and schedule ads to maximize their impact.

Step 6: Target effectively

Utilize the advanced targeting options provided by social media platforms. Refine your audience based on factors like demographics, interests, behaviors and even by retargeting previous website visitors.

Step 7: Optimize ad formats

Choose the most suitable ad formats for your campaign objectives. For instance, use video ads for storytelling or image carousels for showcasing multiple products.

Step 8: Monitor and adjust

Keep a close eye on your ad performance. Regularly review metrics such as click-through rates (CTR), conversion rates and return on ad spend (ROAS). Make adjustments along the course to improve results.

Step 9: A/B test the ads

Experiment with different elements of your ads, such as headlines, visuals or calls to action. A/B testing helps you identify which variations perform best.

Step 10: Track conversions

Implement conversion tracking to measure the success of your campaign. Track actions like sign-ups, purchases or form submissions to gauge ROI accurately.

Step 11: Engage with users

Actively engage with users who interact with your ads. Respond to comments, address questions and foster a sense of community around your brand.

Proven tactics to skyrocket social media ads conversions

By implementing these tactics, you can significantly boost social media ad conversions while enhancing the overall effectiveness of your campaigns.

1. Leverage user-generated content (UGC)

Encourage your audience to create content related to your brand or product and incorporate it into your ads. UGC adds authenticity and trust to your campaigns. For instance, Airbnb frequently features user-generated travel photos in their ads, making their listings more appealing to potential travelers.

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2. Implement remarketing campaigns

Target users who have previously interacted with your website or app but didn't convert. Create specific ad sequences tailored to their behavior. Amazon, for example, retargets users with ads for products they viewed previously, reminding them to complete their purchase.

3. Utilize interactive content

Engage your audience with interactive ad formats, such as polls, quizzes or playable ads. This not only captures attention but also provides a memorable experience. Spotify ran a successful ad campaign allowing users to create personalized playlists based on their music preferences.

4. Incorporate social proof

Showcase positive reviews, ratings or endorsements from satisfied customers. Airbnb, for instance, often includes guest reviews and ratings in their ads to build trust and credibility.

5. Offer exclusive discounts and promotions

Create a sense of urgency by offering limited-time discounts or promotions exclusively through your social media ads. Domino's Pizza, for example, runs time-bound promotions on their social media channels, encouraging immediate action from their audience.

Social media advertising examples

1.  Dove

The brand has a history dating back to 2004, dedicated to promoting the concept of #realbeauty. Their most recent campaign highlights real women and goes by the name #ShowUs. In this campaign, they encouraged users to submit their own images to enhance the representation in advertising. Presently, the campaign boasts a library containing over 5,000 photos, and the hashtag has garnered more than 650,000 uses.

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2. Snickers

Snickers used a clever strategy by utilizing its signature logo colors, featuring text in vibrant yellow set against a rich brown background, immediately drawing eye to the ad. It cleverly prompts users to share their "rookie mistake," fostering engagement while offering a tempting incentive—a chance to win Superbowl tickets.

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3. Netflix: Global Rift Takeovers | Stranger Things 4

When Season four of Stranger Things came out in the spring of 2022, it already had a huge fan base, so it didn't need much extra promotion. However, Netflix decided to celebrate its worldwide popularity and its fans with a campaign called the "Global Rift Takeover." This campaign featured impressive light shows, projections and captivating visuals in cities like New York, Tokyo and Saudi Arabia, all in anticipation and excitement for Season four.

4.  Dollar Shave Club

While it’s in the business of selling razors and personal care products, Dollar Shave Club’s ads rarely focus on its products. A lot of its social posts are about self-care, self-improvement and other helpful advice. It works because it’s helpful without selling or asking anything in return.

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Plan, execute and optimize your social media advertising with Sprinklr

Today’s advertising tech stacks are fragmented and chaotic. As the number of channels expands and cross-platform barriers between point solutions build, converting customers at scale becomes almost impossible. As a result, countless teams are confined to channel-specific social-advertising tools that rely on manual processes, limited integrations and siloed reporting. And because of this, vital customer and market data fall through the cracks, obstructing collaboration within teams. 

A unified platform for social advertising eliminates these barriers. It lets you plan, execute, analyze and optimize ads with a centralized and shareable data source that supports omnichannel and third-party analytics. Plus, it can transform ad spend into relevant campaigns that drive high-quality conversions.

With Sprinklr social advertising, you can:

• Increase campaign performance by up to 50%: Create personalized ad campaigns that deliver higher ROAS and performance. Easily optimize ads using Strategy Groups, refine targeting with audience insights and trigger ads based on sentiment, share of voice, and more – all from one unified platform."

• Improve productivity by 53% with automated workflows: Enhance collaboration in content development, budget management and audience targeting with Sprinklr. Accelerate campaign launches using paid briefs and a shared creative library. Streamline workflows, templates and campaign management across global, local and cross-channel teams from a single hub, simplifying your tech stack and reducing costs.

• Minimize global brand risk across 8+ modern channels: With Sprinklr's Unified-CXM, establish cross-channel global governance with granular permission controls. Ensure brand compliance with automated ad and budget approvals, aided by listening insights to gauge customer sentiment. Quickly respond to unforeseen events or news cycles by instantly pausing ad activity with the Crisis Switch capability.

• Gain actionable insights and measure performance instantly:  Gather and centralize data from 30+ sources into one accessible platform. Monitor and optimize campaigns, including audience insights, trends and budgeting. Replace ad-hoc reports with customizable, real-time dashboards accessible across your organization.