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Social Media. Brand mentions on Social Network. How do you calculate value, how do you get comprehensible ROI in your board presentation? Discussion between guru’s, rainmakers, ninja’s, experts and specialist were long, fierce and mostly built upon hot, slightly stirred air.

It is about the like, right? Or about the click through. Definitively about the click through. Well, much to everyone’s astonishment, Brad Smallwood, Facebook’s head of measurement and insights proved all advertisers who measure the success of an online campaign solely on click-through rates wrong.

The Social Network states boldly that the impression, not the click-through is what really matters and positions itself ad-wise directly in the same play-field as traditional television.  Smallwood bases himself on a new data study from Datalogix that connects ad exposure (seeing a brand’s ad) on Facebook with in-store purchases (buying the brand’s product).

On his blog, Smallwood states that:

  • Impressions create value. 99 percent of sales generated from online branding ad campaigns were from people that saw, but did not interact with, ads— proof that it is the delivery of the marketing message to the right consumer, not the click, that creates real value for brand advertisers.
  • Reach drives revenue for online brand marketers. This is a concept very familiar to TV marketers, who often start with a reach objective—but until now hadn’t been proven for online. When applied to digital brand campaigns, the study demonstrated that campaigns that maximized reach had on average a 70 percent higher return-on-investment.
  • Finding the right message frequency is key. The study revealed that for online brand campaigns, if you reallocated high frequency impressions to people seeing too few impressions, you would see a 40 percent increase in ROI with the same budget. What this means is that for every online campaign there is a “sweetspot” of effective frequency that maximizes return on investment, and that the DataLogix tool can help marketers empirically isolate that sweetspot for each brand and campaign.

This sheds a totally new light on how the effective delivery of an ad, or a message should be measured and valued online, and proves the gut feeling a lot of marketers and communicators have had for a long time: that the power of the silent visitors of social networks, the people who do not interact, like, or click through, is way bigger than estimated.

Very often these people are labeled “lurkers”. For people making a living communicating, they are liquid gold.


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