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Do social media ads really work? We put them to the test!

Christopher Null | March 15, 2013
Social media sites already offer free advertising in the form of tweets and Facebook posts, but these tools can only take your brand so far. The next step involves paying for social media ads, and if you're considering this option, you're probably most concerned with one big question: What will my return actually be? Will spending money on an ad on Twitter or Facebook bring more customers to my business than the same amount spent on Google AdWords?

Social media sites already offer free advertising in the form of tweets and Facebook posts, but these tools can only take your brand so far. The next step involves paying for social media ads, and if you're considering this option, you're probably most concerned with one big question: What will my return actually be? Will spending money on an ad on Twitter or Facebook bring more customers to my business than the same amount spent on Google AdWords?

I put that question to the test by setting up experimental ads across five services: Google AdWords, Facebook, Twitter, LinkedIn, and StumbleUpon. I wanted to see exactly how these tools benefited my own content-creation and corporate blogging business. Indeed, Null Media is exactly the kind of small business that could benefit from social media ads--in theory.

Google AdWords: The baseline

First, a few words about the baseline for this experiment--Google AdWords--where I had already been running ads for several months. For this test run, I raised my overall budget to $25 a day to make it comparable with the social media sites being evaluated. (See page 2 for how I tested.) I quickly discovered that my budget wasn't being exhausted because my bids were too low. By raising these bids to about $2 per click, in line with other services reviewed here, I received more traffic, but not much.

Over the course of the ad run, at both low and high bids, I received 13,970 impressions and got 65 clicks for a total of $80.74. That's an 0.47 percent clickthrough rate at an average price of $1.24 per click.

The verdict: What may sound like poor performance is actually quite good, and since those ads are delivered to people who are actively searching for terms I'm targeting with my keyword ads, that represents a worthwhile investment.

Facebook: Heavy exposure, light clickthrough

Setting up my ad with Facebook was by far my most complicated experience with these services, although its management system and tracking services are quite powerful. The hassles began right from the beginning. I waited all day for my first ad to be approved, but it was "pending" indefinitely. I canceled it and tried again the next day, and it was abruptly approved within minutes.

Facebook offers both CPC (cost per click) and CPM (cost per thousand impressions) ads. I settled on a CPC ad, targeting Facebook users who expressed an interest in various business topics, with a bid of $0.15 per click. Twelve hours later, the ad had received no impressions, likely because the bid was far too low. Facebook suggested a higher bid of $0.57, which got things moving, but slowly. A day later, Facebook's reporting tool suggested an even higher bid of $1.41. Again, impressions increased, but not clicks. Another day later, I raised the bid yet again to $2, at which point Facebook suggested a bid between $2.58 and a whopping $7.30 per click.

 

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