The Bursting Social Media Advertising Bubble 254
schwit1 writes One of the great "paradigms" of the New Normal tech bubble that supposedly differentiated it from dot com bubble 1.0 was that this time it was different, at least when it came to advertising revenues. The mantra went that unlike traditional web-based banner advertising which has been in secular decline over the past decade, social media ad spending — which the bulk of new tech company stalwarts swear is the source of virtually unlimited upside growth — was far more engaging, and generated far greater returns and better results for those spending billions in ad bucks on the new "social-networked" generation. Sadly, this time was not different after all, and this "paradigm" has also turned out to be one big pipe dream. According to the WSJ, citing Gallup, "62% of the more than 18,000 U.S. consumers it polled said social media had no influence on their buying decisions. Another 30% said it had some influence. U.S. companies spent $5.1 billion on social-media advertising in 2013, but Gallup says "consumers are highly adept at tuning out brand-related Facebook and Twitter content."
What do you think "secular" means? (Score:2, Interesting)
I'm genuinely curious, because that word does not fit in that sentence.
Re:Tuning it out? (Score:5, Interesting)
of course the point that marketing effect on consumer behavior is largely unconcious remains.. so that's the real handicap on this study
This "study" is garbage. Most people have always said that advertising doesn't effect them. They said the same thing back in the days of TV, radio, and print. Poll results mean nothing. Web ads link to specific landing pages that allow the advertisers to track the source of the click, and track it to any eventual purchase. If the ads weren't paying, the advertisers wouldn't be running them.
My company runs web ads, and we know exactly which are working, and which aren't. Social media sites actually don't work well for us. Search engine text ads, triggered by specific search terms work much better. But social media ads appear to be working fine for many other advertisers.
Re:Tuning it out? (Score:5, Interesting)
Part of me wonders whether advertising actually works, or is simply a formalized form of hidden bribery
Sure, advertising works. That's why we have had TV commercials since very early on. Does it work the way people claim it does on the Internet? Well, that is a different question and that answer is "depends".
I think an important thing to remember, is that a metric assload of science has been done specifically for advertising. For some reason, that science is not really used with advertising on Web sites.
What works? Easy. Products and placement with certain colors and sounds, targeting your average audience. This is why demographics for TV and Radio shows are important. Have younger females listening? Advertise woman's products, "light" alcohol, and healthier foods. Have a bunch of younger males watching? Advertise beer, fast food (Extra Big Ass Fries), and men's products. Have a mix of younger adults, run gender neutral ads for cleaning products, baby products, and "family" style food.
The key here is that ads have to be appealing, not overwhelming. Sure, some people fall for the infomercial fast talking guy showing off their "Amazing (Billy Mayes TM)" products, but those are an extreme minority. The majority of web sites either don't care about overloading consumers or don't realize they are doing it.
What does not work? Overload. Slashdot currently has dozens of adds, all blinking and flashing in an attempt to get your attention. This method of advertising is equivalent to having 10 TV commercials simultaneously sharing your TV screen. It's annoying, and the overwhelming majority of people won't click anything even if they might be interested. What they will do is open a new browser window and search in clean space for the product and information. This way they can get it without the overloading of senses. Web sites decided a while ago that since you can't target an audience by any rational means, the majority of the time, you have to overload people with everything they might possibly want and pray that a user clicks and generates a fraction of a penny.
Services like Google ads try to make more sense of your audience so that you can target them more like TV/Radio commercials. Web sites on a massive scale may use the targeted ads, but are still overloading "hoping" for a click.
Psychological studies have shown how good sensory overloading can be at causing discomfort and confusing the audience. Ever wonder why CNN and MSNBC have shit flashing all over the place? Overloading is a huge reason why, and yes it's intentionally done. Not for advertising purposes, but it's an interesting one to study.