Measuring The Value Of Social Media Advertising

Nielsen and Facebook recently joined forces to develop ad effectiveness solutions to determine consumer attitudes, brand perception and purchase intent from social media advertising.

Perhaps unsurprisingly, immediately after the two companies announced their strategic love affair, Nielsen started publishing glowing reports about Facebook and how much time people are spending on social networks in general.

Today, the companies are releasing the first insights from their alliance on the effectiveness of brand advertising on social networks, and lo and behold: the take-away conclusion is that apparently, Facebook ads work well in terms of campaign effectiveness.

Note that we’re not saying the report is bogus, but it’s something to keep in mind if you decide to download it for yourself.

(On a sidenote: are you a fan of TechCrunch on Facebook already?)

According to Nielsen, the report leverages six months of research consisting of surveys of more than 800,000 Facebook users and more than 125 individual Facebook ad campaigns from some 70 brand advertisers.

Nielsen looks at advertising from a “paid” and “earned” media perspective, whereby the second is considered advertising that is passed along to or shared among friends.

The company took a look at 14 Facebook ad campaigns that incorporated the “Become A Fan” engagement unit and sliced the effectiveness results three different ways, by each of the types of ads available on Facebook:

1) Lift from a standard “Homepage Ad”
2) Lift from an ad that featured social context or “Homepage ads with Social Context”
3) Lift from “Organic Ads,” newsfeed stories that are sent to friends of users who engage with advertising on a brand.

Nielsen found that the first type of ads on average generated a 10% increase in ad recall, a 4% increase in brand awareness and a 2% increase in purchase intent among users who saw them compared with a control group with similar demographics or characteristics who didn’t.

According to Nielsen, that increase in advertising recall jumped to 16% when ads included mentions of friends who were ‘fans’, and 30% when the ads coincided with a similar mention in users’ newsfeeds.

Intent for purchase climbed 2% higher among viewers of homepage ads vs. non-viewers but went up 8% either from social ads or when ads appeared alongside organic mentions of the brand in the news feed. Brand awareness went up 2% from just a homepage ad, 8% with a social ad and 13% when a homepage ad appeared along with a mention of friends who were brand fans in the users’ newsfeeds.

In an interview with AdAge, Jon Gibbs, VP Media Analytics at Nielsen, reiterated that the company did not incorporate actual purchases because the research is still young. Gibbs added that, in next generations, he would “assume we will start incorporating offline purchase and other transactional data as part of the analysis.”

Now that would be slightly more interesting in my opinion, although I wish other measurement companies would get the same access to data as Nielsen does so we can compare different angles and research methods with one another.