Recent comments by Brad Smallwood, Facebook’s Head of Measurement and Insights, have really thrown marketers for a loop. At the recent Interactive Advertising Bureau MIXX Conference, Smallwood indicated, “It is the delivery of the marketing message to the right consumer, not the click, which creates real value for brand advertisers.”
In essence, Facebook is downplaying the role of the almighty click, falling back on long-term marketing truisms that recency and frequency are the keys to marketing effectiveness.
Most organizations waste a good portion of their marketing dollars, but lack of direct metrics leaves them at a loss as to what’s effective and what’s failing.
eMarketing is supposed to fix all of that, right? So Smallwood’s comments fly in the face of digital marketing dogma. We’re supposed to be able to see and track marketing effectiveness online.
Where’s All This Coming From?
The truth is that Facebook advertising has gotten some fairly negative press in the past year, which has done nothing to help the stock price of the newly public firm. Case in point being General Motor’s much publicized decision to pull all advertising from Facebook only days before its IPO.
The challenge for GM (who has since returned to Facebook) and other online marketers has been lackluster click-through rates for Facebook ads. Dollar for dollar, Facebook gives advertisers great reach relative to Google, but click-throughs are few and far between.
Facebook is therefore looking to recast the metrics of success that online marketers use. A good strategy given their predicament, but does it hold water?
A Defense of Recency and Frequency
Admittedly, Smallwood makes a good point. We know that brand impressions are important and the tremendous amount of time spent on Facebook each day gives ample opportunity for impressions. Further, how important are those clicks? GM sells very few of its cars online. Online advertising builds awareness and preference for a sale that happens at a local dealership.
This puts Facebook ads in the same category as TV, radio, billboards and other advertising vehicles (pun intended) on which many industries, including both automobiles and healthcare, invest the bulk of their advertising dollars. And, relative to those advertising channels, Facebook offers better targeting, control, and metrics.
The Flip Side
On the other hand, impressions aren’t always effective. As the classic saying from John Wanamaker goes, “half the money I spend on advertising is wasted; the trouble is I don’t know which half.”
Mass market advertising requires messaging that appeal to the largest possible audience. Highly targeted advertising can be far more impactful when the messaging is tailored to each customer segment. These segments can be fickle, however, and it can be tough to build traditional focus groups that allow you to hone those messages appropriately.
That’s rarely been an issue online as you simply refine your marketing message in real-time with real data that allows for quick tailoring and adaptation of messages.
That is, of course, if anyone chooses to interact with those ads.
Low click-through rates make it difficult to determine if an ad is working, eliminates your ability to adapt campaigns mid-stream, and undermines your tracking for ROI. Again, this is no different than most of your advertising spend today, but it places it at a disadvantage relative to other online marketing options.
What Do You Think?
So what’s your take on the question of Facebook’s advertising effectiveness? Are clicks the end-all be-all? Or is Smallwood pointing out an important piece of marketing effectiveness that we seem to have lost in this online world?