Nielsen and Facebook just released a study evaluating the impact of various types of social media ads on 800,000 participants. While there was significant value generated from a basic page ad, the results suggest that a personalized ad (that indicates which friends like a particular product) increased brand awareness by 60% and moreover increased purchasing intent by 4x.
With the Facebook announcement today of the OpenGraph API, personalization is now easily available not only within Facebook, but across the web. Based on Nielsen’s report, it is clear that if businesses want to get the most value for their advertising dollars, they should implement this personalization as soon as possible across all potential touch points and at various levels of the marketing funnel. While it may mean providing more information to Facebook, it seems that the potential return on marketing dollars will be worth it.
Always Connected, All The Time
A recent study by the Kaiser Family Foundation of 8-18 year-olds in the US showed that children are consuming more media than ever before. On average children are using digital media (including TV, computers, video games, music, etc.) for 10:45 per day, an increase of 40% from 10 years ago. None of this is shocking given the technology advances over the past decade, even though it’s a little surprising that children have 10:45 to spend on media outside of school hours. What was eye-opening was the high correlation between heavy media use and poorer grades. While only 23% of light media users reported poor grades, 47% of heavy media users had poor grades. While the presentation does not get into causes of the relationship, it is clear that overuse of digital media can have a downside. The more time one spends with digital media, the less one studies, reads, pursues hobbies, or interacts with other people offline.
If heavy media use has such a clear effect on children, is it a stretch to suggest that the effects may be similar on adults? Continuous use of media could have a deleterious effect not only on workplace productivity, but also in the quality of real life interactions with others.
Is Social Media the Solution?
The average Facebook user spends 6.5 hours a month on Facebook alone. Add on Twitter, websites, email, video and other online avenues, and it’s no surprise that many people spend a majority of their waking hours in front of a screen. However, unlike most digital media activities, shouldn’t social media be a reasonable substitute for offline interactions?
This piece by Ben Atlas describes the anti-social nature of the major social networks. It suggests that there is far more voyeurism and blast messaging on social networks than there is genuine interaction between friends. Social networks have multitudes of uses (event planning, reconnecting with acquaintances, marketing a personal brand, a digital rolodex, etc.), but as far as enhancing emotional connections that humans crave within their social interactions, Facebook and Twitter leave a lot to be desired. Therefore, according to the author, social networks are not a substitute for genuine interactions, instead adding to clutter of our already crowded digital lives. Ideally, we all should spend more time cultivating relationships and communicating offline versus spending more and more time on these “social” networks.
How to Take Control of Your Digital Life
You can start by streamlining four major time drains based on expert advice (Television, News Sites, Email, Social Networks).
Television: Figure out what programs you want to watch and get a DVR to record them. Watch them on your time. If you are like the average American who watches 4 hours of TV a day, simply skipping the ads through a DVR will save you 1 hour a day. Even if you don’t skip ads, the DVR will keep you from mindlessly watching random TV when you have nothing better to do.
News Sites: Take all the websites you like to visit and set them up in Google Reader (here is an article which is a good guide), and then over time streamline them. It will change your browsing habits completely and reduce the amount of time you are mindlessly jumping around the web.
Email: Many users check their inbox each time they are alerted of a new message, which is a major waste of time. It takes more time to transition between email and whatever work you might be doing than it does to deal with the actual message. Furthermore, a recent study suggested that the average user lost 8.5 hours per week transitioning between email and their previous task. Email productivity experts suggest checking your inbox in bulk 1-3 times a day at preset times. Find a balance where you can respond to emails on a timely basis, but you do not check your email so often that is a distraction.
Social Networks: This Lifehacker article suggests you use NutshellMail and we agree. Seriously though, if you can avoid checking the networks constantly while creating filters to reduce the noise, you will be far more efficient while at the same time interacting more with the people you care about most.
The problem with social networks is that you are connected with hundreds of friends, but you really only want to hear from a much smaller subset on a regular basis. On top of that, social networks have every incentive to have you waste your precious time on the site – it makes them more money. This is why gaming has become so important to Facebook, even though there is very little that is social about most Facebook games.
Most users however, have a different motive than Facebook does. They want to stay in touch with their friends in the easiest way possible. As long as users are disciplined in their usage of social networks, the time drain will disappear.
What’s the Payoff?
By taking control of the media that currently control us, we can streamline our lives and have a newfound freedom, without having to disconnect ourselves completely. Of course the recommendations above require some planning and discipline, and isn’t always practical (I do plan on watching the NBA Playoffs live, for example), but in return you get greater efficiency, more free time, and a better quality of life. Wasn’t a better quality of life the goal of technology in the first place?
Nirav Batavia is VP of Interactive Marketing for NutshellMail (www.nutshellmail.com), the first social networking management tool that combines the best of the Social Web with the original killer app: email. The service lets you organize, customize, monitor, manage and interact with all your social networks (Facebook, Twitter, MySpace, LinkedIn, etc.) and extra email accounts from an interactive email dashboard delivered directly to your favorite inbox on a schedule that you choose. NutshellMail is part of the fbFund REV incubator program, a joint venture between Facebook, Founders Fund and Accel Partners to seed and incubate early stage companies. NutshellMail keeps you connected and saves you time.
An experiment was recently conducted examining the effectiveness of seven different types of online advertising. The researchers’ conclusions were interesting and relevant to businesses trying to figure out how to properly leverage social media and online marketing to engage their customer base. It turned out that corporate pages with logos (such as Facebook Fan Pages) and widgets (such as interactive elements) were the most popular in engaging users but weak as far as creating intent to purchase. Banner ads and email newsletters (traditional online media) had the opposite effect. Though these traditional online media channels had the lowest engagement rates, they produced the highest rates of purchasing intent.
What does this mean for the average small business trying to figure out where to concentrate their efforts? According to this experiment, just having a social media presence would not be enough to drive purchases, but only focusing on traditional advertising like banner ads and email newsletters will not effectively increase your customer base. In fact, the most powerful strategy would seem to be using social channels to engage new users and create community and then complement the social media advertising with traditional banner ads and email newsletters to re-engage the community and drive product purchases.
Many advertising analysts have pointed out that new customer acquisition is a weakness of traditional online advertising, even if the re-engagement of existing customers was stellar. Social media advertising provides a solution to customer acquisition and effectively complements but does not replace traditional online ads. By using traditional advertising channels to reinforce social media, businesses can create a self-reinforcing virtuous cycle, increasing both their engagement and reach with customers.
You can read the entirety of the report here.
Newsrooms are shuttering as journalists are being laid off and print magazines are folding. While it may be premature for Chicken Little to cry that the sky is falling on the traditional media establishment, people are starting to ask serious questions about the traditional media ad-supported business model.
A recent press release by Kantar Media shows double-digit declines in every ad sector except for online advertising. The press release suggests that the declines are mostly due to businesses pulling back during the economic downturn, and that ad spending will recover with the economy. It may be true that advertisers are seeing higher returns on digital advertising or that advertisers are willing to spend more money to experiment online. What is clear is that digital advertising will continue to attract a growing amount of dollars going forward.
You may find it interesting that there is no mention of a possible structural shift of spending from traditional media to online advertising especially with the rise of social media. What if traditional media spending does not recover with the economy?
Here is a link to the full press release.
