Anti-Social Advertisers

Why aren’t advertisers spending money on Social Media?

They know it’s popular. People now spend an average of around 7 hours a month on Social Networks with key target groups like young people using Social Media a lot more. And yet worldwide advertisers only spend just over 1% of their budgets on Social Media. They spend 50 times as much on TV.

Other research quoted by Scott Monty shows that marketers rate Social Media #4 in terms of ROI as a marketing channel but #6 in terms of budget allocation. Mass media is #7 in ROI but #4 in budget allocation.

Part of it is the newness of the medium. It took TV 26 years and a world war to overtake radio as a medium in terms of ad expenditure. And Social Networks only started 11 years ago with Friendster in 2002. But I don’t think that is all.

It is to do with the nature of the medium. Newspapers are primarily about information. Ads are a natural fit. They tell you something about the brand. Radio and TV’s role is entertainment. It took advertisers a while to realize this. Early ads were essential print ads brought to life. It was only when brands like Kodak and Timex discovered the power of narrative to entertain that the medium took off. Now all the best TV ads convey a message while entertaining you.

Social Media is essentially social (Duh!). It is about connecting with other people, being part of a community and sharing things. It is about conversations between people with shared interests. Advertisers find it hard to contribute to this.

We say that brands are like people but this is just a conceit. I don’t want to be friends or have a relationship with a brand in the way I do my human friends. So brands can rarely be a member of my Social Network. That doesn’t mean they can’t have a role. The best brands do. Red Bull is a curator for what I care about, providing material for my social group to form around. Oreo provides a forum for me to connect with other Oreo lovers in a lighthearted way.Converse allows me to show my creative counter-culture side. Starbucks continues its passion for coffee. As such they act more like they do as brands rather than using Social Media as a communications medium.

But the fact is that it is not an easy fit and we as advertisers are still finding our way. Until we do Social Media will stay the poor relation and not get its fair share of advertisers’ spending.