May 30, 2013

Marketers, Get Ready for Social Media Advertising to Explode

Have you ever logged on to Facebook and noticed an ad on the right side of your screen advertising a product you were just discussing with a friend? If you have, you’ve probably wondered how in the world Facebook could have possibly known that you were just searching for a new pair of Nikes or a new set of speakers. To some it’s just the magic of the Internet and to others it’s totally “Big Brother,” but the fact of the matter is that advertising on social media is becoming more common and it’s about to explode.

A recent Business Insider (BI) Report analyzed the current state of social media advertising and what’s in hold for the future, focusing on the impact of mobile usage and projected growth.  And the results corroborate the sentiment that social media for business use is just in its infancy.

That’s because social media is a marketers dream. Networking sites like Facebook, Twitter, LinkedIn and Google + gives marketers’ access to a huge user base that is made up of highly engaged individuals and attractive demographics. According to BI, in July of 2012 Americans were spending an average of 12 hours per month on social networks. More specifically, users 18-24 were spending an average of 20 hours.

Although social media advertising only represents one to 10 percent of ad budgets for most marketers, recent studies project spending to reach $11 billion in 2017 a marked increase from last year’s $4.7 billion.

Despite healthy projected growth, social media advertising is still in its infancy and marketers are still working out the kinks. One popular network recently learned that the hard way. Japanese carmaker Nissan and other big-named companies suspended campaigns featured on Facebook after ads were displayed next to offensive content featured on the site. The social networking site recently released new policies to quickly detect and remove “hate speech” or offensive content. However, it wasn’t fast enough as Nissan and Dove both pulled advertising amid concerns their advertising was displayed alongside distasteful content.

Although some have temporarily put a pause on Facebook spending, the stats say otherwise.

According to the BI survey, increased mobile usage will also contribute to the growth of social media advertising as both Twitter and Facebook have passed the 50 percent mobile usage benchmark. According Experian, 15 percent of totally U.S. mobile internet time is spent on social networking sites, giving markets an opportunity to market customers at home on their laptops and on the go.

The opportunities for marketers on social media are endless. The question now is how will customers feel about being constantly inundated with ads?

Check out the full report, here.

Edited by Carrie Schmelkin

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