Tuesday, December 1st, 2015 | 8 min read
So far, 2015 has been the biggest year ever for paid advertising on social media. Instagram opened its advertising API to all businesses; Facebook launched new Product Ads; Twitter ramped up its event targeting capabilities; Pinterest unveiled Buyable Pins; and Snapchat introduced its 3V advertising strategy for Vertical Video Views.
Whew, that’s a lot.
With all of these new opportunities to launch paid ads—and with organic reach decreasing—it’s no wonder CMOs are increasingly incorporating paid advertising into their strategies, boosting targeted posts to reach the right audiences at the right times.
In fact, according to a 2014 report from The CMO Survey, 9.4% of marketing budgets are currently devoted to social media spend, but that number is set to rise to 21.4% by 2019—representing a 128% increase in budget percentage.
The question now is: What does the future hold for paid advertising? And what do CMOs need to know to make better strategic decisions in the year ahead?
Let’s take a look.
Michael Brenner, CEO of Marketing Insider Group, wrote, “The leading marketing trend of 2016 will be the maturing of the age of ad blocking.”
He explained that as more and more consumers download ad blockers, marketers will be challenged to raise their budgets to get their messages across, improve their ability to show ROI, and—perhaps most importantly—figure out how to deliver ads with content that people actually want to consume.
As Brenner wrote, “Their talent in storytelling will be put to much better use telling actual stories instead of trying to interrupt the ones we want to pay for.”
Of course, the threat of ad blocking poses the biggest risk for CMOs considering paid search marketing. It doesn’t currently affect those trying to reach audiences on social media—at least not directly. Alex Packham, Founder of ASTP, pointed out at Social Media Week London that the competition in search marketing could drive advertisers away from these pay-per-click strategies and encourage them to transfer some of their budget to paid social ads.
“We can’t stop ad blocking software,” Packham said, “But we can improve our advertising and content to get to the point people don’t feel they need to block advertising online, which has to be the industry’s goal.”
As social media marketing strategist Jeff Bullas wrote in his post of trends for 2016, “Mobile is now your first screen.” In other words, what we’ve been used to calling the second screen is now the main focus of many advertisers’ strategies. And why is that? Because it’s where the consumers are—with mobile usage having overtaken desktop usage in 2014.
MDG Advertising also reported that mobile already accounts for 35% of all digital spend, and it’s expected to be the fastest growing advertising segment in 2016. Particularly, Facebook has emerged as a mobile goldmine for marketers. The study stated that one out of every five minutes people use mobile are spent on Facebook. And Business Insider reported that mobile accounts for a whopping 75% of Facebook’s ad revenue.
So, what does this mean for marketers?
As Bullas points out, “less is more” on mobile, since you’re working with smaller screens and, sometimes, more finicky online connection. To up the game, CMOs need to be sure all content is optimized to load quickly and be viewed on these handheld devices. Smart tactics include incorporating straightforward call-to-action buttons on ads and simplifying mobile website design for easier navigation.
Emarketer estimates that the number of US digital video viewers will reach 204 million, increasing by more than 22 million from 2013. Additionally, the company projects that US digital video ad spending will jump from $7.7 billion this year to $14.38 billion in 2019.
Again, this supply of a specific type of content is largely in response to consumer interest and demand. According to eMarketer, US adults jumped from watching 21 minutes of digital video each day in 2011 to viewing one hour and 16 minutes of digital video each day in 2015. And, of course, we’re increasingly viewing this content on tablets and smartphones.
Thankfully, marketers have more opportunities than ever before to craft original, custom, and targeted ads for video-hungry audiences.
Last Fall, Instagram unveiled its video ad capabilities, and just a few months ago, the platform extended video ads from 15 to 30 seconds. This year also saw the launch of Cinematic Pins on Pinterest, as well as enhanced targeting capabilities for video on Facebook, Twitter, and Snapchat.
One of the best ways to get the most out of your ad dollars is to test different creative assets with a small budget before launching a major paid campaign.
Social media management agency Consumer Acquisition recommends testing 10-15 images with the same ad copy against one large audience. Finding the right images is crucial because visual assets can affect up to 75% of a post’s performance. Additionally, A/B testing headlines can increase engagement by 25% on Facebook.
To keep your strategy fresh and engagement numbers high, the company recommends running these tests each week, and spending roughly 10 percent of your monthly budget on testing alone.
As for Twitter, the social network recently launched #TweetSmarter and #TestSmarter guides, in partnership with HubSpot, to help marketers build better ads. The #TestSmarter report suggests testing different kinds of images to see which ones your audience responds to. For instance, do they prefer product or lifestyle visuals, bright or subtle colors, and copy over the image or no copy?
With these testing tools at your disposable—and an ability to choose any budget you deem fit—it’s a smart move to test different assets against your audience and use data to determine which ones drive the strongest results.
Just because organic traffic is declining rapidly on networks like Facebook doesn’t mean marketers need to throw their organic social efforts out the window.
Larry Kim of WordStream predicts that “content remarketing” is on the rise. This process involves starting off with creating high-quality content, sharing it on social media, and then selecting top-performing posts to boost to targeted audiences. From there, you should track site visitors from those posts, use that data to create custom audiences, and launch new paid posts to reach these optimized segments of consumers.
As Kim wrote, “Remarketing to these people who have already visited your website enables you to get back in front of them with relevant, targeted offers based on what you know of their demographic traits and behaviors.”
This has been a huge year for paid advertising on social media, and we should only expect 2016 to bring more developments. As organic reach continues to dwindle, paid advertising is becoming not just an attractive strategy, but a necessary one. The good news is that each major social network is attempting to aid marketers in their efforts by launching innovative advertising resources.
CMOs would be wise to not only jump on these new features and services, but also use strategic tactics such as A/B testing and mobile optimization to be sure they’re getting the most out of what they offer.
About the Author: Amanda Walgrove writes about content marketing, social media, and online entertainment. She has written for Advertising Week, The Huffington Post, Tablet Magazine, and The Content Strategist, among others.