Guest comment: Engaging with the online consumer – Beyond social networks

by Liane Dietrich

There is no doubting Facebook’s success. The social networking site recently celebrated 150 million mobile users and launched Facebook Places in the US, a location-based service to let users share where they shop, eat and socialise. The site has also overtaken Google as the most popular website in the US and is expecting profits to topple $1bn by the end of this year. The company is clearly on an upward trend and has continued international expansion in mind. Mark Zuckerberg, Facebook’s CEO, told delegates at the Cannes Lions advertising festival that the company plans to boost its online presence across the globe over the next 12 months. While organic growth has proved successful for Facebook, LinkShare believes social networks have some way to go before they can demonstrate a clear return on investment for the brands advertising on their sites.

LinkShare was keen to understand what drives consumers to respond to online advertising within social networks. Through our consumer research in June, we spoke to 2,000 consumers* to gauge their opinions on the matter. Surprisingly, despite the continued rise in the popularity of social networks just three per cent of respondents considered adverts on personal social networks such as Facebook useful in assisting their online purchasing decisions. This figure was even lower than a survey conducted the previous year, when nine per cent of consumers were engaged by Facebook ads and were encouraged to click through to find out more. So, why such a disconnect when popularity of social networks is burgeoning? eMarketer has just reported that social network advertising will top $3.3bn this year, with advertising revenues up 31 per cent on last year. With such heavy investment brands need to look what they can learn to enhance relationships with their target audience on social networks and ensure return on their investment.

This low interaction suggests that consumers are struggling to accept the combination of social interaction and brand interaction on essentially non-commercial environments. Adverts being used on Facebook and other social networks are not yet having the desired effect in terms of audience participation. However, there is some encouragement for advertisers targeting social sites, as less than a fifth of the respondents we surveyed considered adverts an active interference to their online activity, suggesting they are open to the right type of marketing and that there is still an opportunity for brands to improve the success of their online interaction. Headway is also being made via industry bodies, with the International Advertising Bureau (IAB) announcing that it is introducing a social media measurement framework to bring greater clarity and consistency to monitoring social media activity in the UK. Such plans by the IAB will help advertisers and agencies take on board the complexities of measuring social media, which in-turn will enable brands to have greater control in the investments they make online.

In the interim, while such measurement frameworks are put into place and become a more rigorous element of digital marketing, the online world continues to be competitive. Brands are continually looking at ways to break through the noise and engage directly with their target consumer, wherever they happen to be. The key to success for brands looking to expand their online presence is to ensure they are well equipped to respond to the consumer’s needs. Despite the growth and popularity of sites such as Facebook, merely maintaining a presence is not enough to engage and capture the consumer’s attention. Brands need to be much more astute in the way they employ marketing tactics, looking to technologies and tools that enable them to be more targeted in their approach.

Affiliate marketing is such a tool, and is becoming an increasingly popular within brands’ digital marketing strategies. Affiliate marketing enables companies to capture a large audience, by contacting them via multiple channels in a measurable and non-intrusive fashion. An effective affiliate marketing strategy allows both advertisers and publishers to create tracking links online with exciting new rich media options to drive traffic to a brand’s website. Brands can utilise the audiences from all manner of sites, from social networks to online forums, blogs and price comparison websites to create visually appealing content to engage with consumers.

To maximise success, companies need be mindful that users logging on to social networks are there to network and not necessarily to shop. It is a careful balance between social interaction and brand intervention. To be successful in this less traditional space, brands need to work harder to make sure they convey information which both captures their audience’s attention and also enhances the consumer’s overall online shopping experience. By investing the time to develop and maintain targeted and strategic campaigns, such as those employed through affiliate marketing, designed to closely match their target audience, brands can look to receive returns in the form of conversions to sale from social networks while also experiencing a brand loyalty and increased audience engagement.

It is only by truly understanding consumer behaviour and the social niches that those consumers interact with that brands will realise there is no ‘one size fits all’ approach to reaching audiences on social networks. The online landscape is changing and while more needs to be done to determine the advantages and pitfalls of using ads on social networking sites, it is certainly a step in the right direction that the industry is standing up and taking notice that transparency and metrics are required. It will be interesting to see whether the predictions for social network advertising revenues will become a reality and how digital marketing campaigns will develop in coming years as increased measurement helps to justify return on investment for those brands willing to explore this new advertising trend.

* Research conducted in June 2010 with 2,000 respondents through Toluna, the online research panel provider.

Liane Dietrich is managing director of affiliate network LinkShare UK.