A Visual IQ Perspective:
Four Crucial Takeaways on Attribution & Facebook ROI
Marketing on Facebook has been one of the hottest topics in the digital marketing industry for the last several years. Regardless of the measurable value, brands have been in a virtual arms race with their competitors to secure the most fans, likes, etc. Social media experts, gurus, ninjas, and magicians have sprung up to fill this need in the marketplace and so far there has been fairly good traction in figuring out how to best utilize Facebook and other social channels to engage with consumers.
Social media is no longer an emerging category and is certainly now a mainstream channel for most advertisers. As more budgets flow to advertising on Facebook the discussion and debate has quickly moved away from if it should be used to how it should be accountable for ROI like any other media.
There has been a lot of speculation around why GM pulled its $10M+ budget from Facebook earlier this year. All accounts point to the likelihood that the auto manufacturer was not evaluating Facebook advertising by ROI, but rather the antiquated metric of click-thru-rate (CTR). Was this because they were ignoring ROI or were just having trouble tracking it so were forced to use a proxy for success?
Is Facebook ROI tracking hard? Not for us…
September 2010 marked the pivotal moment when Facebook shut down conversion tracking for most advertisers due to swirling privacy concerns (mainly because of abuse by some Facebook application developers). Since that time there have been many Internet posts regarding issues encountered when attempting to measure Facebook ROI.
Here at Visual IQ we have been tracking advertising activity on Facebook in any and every way it can be tracked since the social network first offered advertising. (In fact, our tracking history with Facebook predates the birth of many of our attribution competitors). Our unique, proprietary, pixel-less tracking system pulls in data from all of our clients' digital marketing tools and all of their data sources – including Facebook.
Some of the ways Visual IQ has been delivering social ROI metrics include:
- Post-September 2010 - Several of our clients were among the top advertisers who have been allowed to track conversion activity via a program run by Facebook.
- Self-Service Platform - Click tracking of Facebook PPC ads has been allowed since the start of self-service program and is a best practice for any advertisers utilizing the program, including our clients.
- June 2012 - Microsoft's Atlas became the first third-party ad server certified to track impressions and clicks on paid media on Facebook. Thus, any Visual IQ clients using Atlas could immediately provide that tracking data to our software.
As advertisers and marketing technologies continue to partner with Facebook and other social media companies our clients benefit from our agnostic tracking approach. They can easily incorporate data from a number of social channels into our products to support the holistic, cross channel measurement approach that we offer.
Four Key Takeaways for Facebook Advertisers
Visual IQ's long history with Facebook conversion and ROI tracking on behalf of many clients has provided us a unique perspective into some of trends taking place across verticals, business models and company sizes. Not only do we have insight into how Facebook campaigns have historically performed individually, but also how they perform within the context of cross channel campaigns and their ROI efficacy in relation to any online elements (display, mobile, search, etc.) and even offline channels (television, print, etc.).
The following are four media challenges we see repeatedly with Facebook campaigns:
1. Facebook ads are almost always undervalued. Like most online display units, social media ads are generally undervalued as a contributor to conversions. They tend to reach users at the top of the funnel and drive tremendous consumer engagement, but when viewed through the last ad methodology, they seemingly fall flat and are thus viewed as underperforming. However, because we track all of the media touchpoints between a brand and its consumers (what we at Visual IQ call engagement stacks), we are able to show them how, more often than they think, their social efforts have a tremendous impact on users at the beginning of the engagement stack. Then, as users move through the funnel, they convert via lower funnel tactics such as paid search or even direct visits to the website.
In one recent campaign, Facebook received 35 percent more credit when viewed through our TrueMetrics compared to last ad measurement, and was the second most efficient channel – just behind branded search.
2. Facebook users are valuable, "in-market" consumers. One of the more helpful analyses we provide marketers is the temporal correlation between converting users and the various channels, sites, and placements in which the brand's advertising reaches those users. Across the board, we generally see that the time lag between an ad impression on Facebook and the brand's desired converting action is much shorter than other media.
In the chart below, Facebook converters tend to fall toward the left of the time lag analysis. This helps our clients understand how often to optimize Facebook campaigns and how soon they should start seeing results from those optimizations. And if a client needs to get quick results, Facebook ends up being at top of the media allocation list.
3. Media planners have trouble figuring out how much to spend. One of the biggest concerns we hear from marketers is how to properly allocate budgets to Facebook. They may have years of experience with search, display, email, and video, etc., but because of the perceived problem of tracking they are generally forced to take a “hit or miss” strategy with this very efficient channel. Our unique IQ Sage scenario planning product helps media buyers solve this issue by analyzing all of their in-market media, and then producing automated media allocation recommendations at the placement level (and for SEM, the keyword level).
For example, on a recent campaign, IQ Sage recommended that the client spend an extra 30 percent on Facebook, which equated to more than a half million dollar increase. The client followed the recommendation and saw their overall campaign CPA drop from $26 to $17 from the increased efficiency produced from this single optimization.
4. What's the right frequency for Facebook advertising? It's not surprising that any media channel would have a point of diminishing returns. At some point, reaching users with high message frequency just doesn't pay off. That's marketing 101. However, Facebook's frequency-to-response curve is virtually unlike any other channel we've ever seen!
Check out the charts below from a recent large client campaign. The vertical axis is conversion rate and the horizontal axis is frequency. In the All graph, we see how media generally performs —where at some point response rates slow to a crawl at a maximum frequency. The Premium Network graph (buys), although more expensive than the aggregate media, show an uptick at the top of the frequency curve due to the quality of the inventory with regards to user engagement.
Now look at the Facebook graph. Conversion rates actually drop when the advertiser tries to overload the audience! This is not just an anomaly to this one campaign; we've seen this happen similarly to other Facebook campaigns with high frequency. What's happening is that Facebook users who are bombarded with messaging get turned off by the advertiser. The takeaway here is that you can actually negatively impact your target audience if you don't understand the frequency levels that are acceptable on this platform. Users will accept the fact that advertising underwrites the free experience on Facebook, but obviously don't want to feel abused by this value exchange.
These are just a few of the insights we've gathered from working with clients on their Facebook marketing efforts throughout the first era of the social network's advertising offering. It's not a secret that Facebook is planning to continuously roll out new and innovative opportunities for marketers. Their audience scale is absolutely unprecedented and Madison Avenue is literally salivating to get closer to these highly engaged users. As Facebook evolves, Visual IQ will be there to help our clients figure out how to best reach these users, which messages and ad units impact ROI, and how to allocate efficient dollars to this channel.
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