The recently-concluded IAB MIXX Conference in New York, a prominent event for marketing and agency professionals, featured talks by the most important names in the digital space. Among them was Brad Smallwood, Head of Measurement and Insights at Facebook, whose talk was titled ‘Insights for Marketers: Using Measurement to Build a Better Ecosystem for Brand Campaigns‘. He discussed findings from a study conducted in partnership with data mining firm Datalogix — using a new tool that connects ad exposure on Facebook with in-store purchases. The study looked at 50 digital ad campaigns on Facebook, and the following were the conclusions drawn:
Clicks are not the right metrics for advertisers: Quoting a Nielsen study that showed that there is no correlation between click-through rates for ads and offline sales, he shared that 99% of sales actually came from users who saw an ad but did not interact with it.
Impressions create real value: It is far more important to deliver the marketing message, and to the right consumer. This is where the real impact of advertising lies.
Reach drives revenue: The study demonstrated that ad campaigns which maximised their reach, had on average, a 70% higher return-on-investment.
Finding the right message frequency is key: The study also showed that for online brand campaigns, there is a ‘sweet spot’ of effective frequency that maximises the RoI, but this frequency differs from brand to brand, and from campaign to campaign. For example, some advertisers will find that four impressions per user will increase profit. After that, retail sales might still go up, but not enough to cover the cost of advertising and production. When impressions are more evenly allocated, advertisers have seen a 40% increase in RoI.
Facebook wants to help marketers and advertisers in figuring out this ‘sweet spot’ and advocates the Datalogix tool to do so. The tool enables marketers who have offline sales objectives to measure and optimise their digital campaigns.
“The Facebook ad server optimises the delivery of brand campaigns to maximize for reach. If you’re not doing this, you’re kind of wasting money. It’s up to us to actually use this data, and to move away from models that don’t maximise ROI.” – Brad Smallwood, Head, Measurement and Insights, Facebook
The talk was followed by a presentation by Tom Buday, Global Head of Marketing and Consumer Communication at Nestle, who showcased Nestle’s ‘Skinny Cow’ campaign page, as an example of a page that abides by Facebook’s recommendations for reach and frequency, and sees high engagement. He laid a great deal of emphasis on the quality of the content in an advertisement.
“The single greatest source of leverage is the quality of messaging, whether its a TV commercial or a post on a Facebook Page. It’s not platforms that work or don’t work, it’s brand communications and messages that do.” – Tom Buday, Global Head, Marketing and Consumer Communication, Nestle.