There is a lot of buzz these days around social media advertising, as popular social media networks like Facebook, YouTube, and Twitter aggressively promote their advertising offerings.  Their efforts seem to be paying off as a couple articles recently came out that show social media advertising gaining momentum and becoming a key component in a company’s marketing mix.

eMarketer published the results of a July 2013 survey from media software company STRATA.  90% of the survey respondents, who were US agency executives, said that they are likely to use Facebook for client advertising campaigns.  YouTube and Twitter came in next at 55% and 53% respectively.

More importantly, even though paid social media advertising isn’t yet close to dominating ad budgets, they are beginning to represent a non-trivial portion of the budget.  As this chart shows, 42% of the respondents said that greater than 5% of their clients’ ad budgets are allocated to paid social media…

Separately, AdAge recently held a Digital Conference in San Francisco and CIO reports that there was a lot of discussion around social media marketing.  In the discussions, there seemed to be consistency in terms of how marketers are thinking about their social efforts:

    • “Paid social” is when a company pays to advertise in someone’s social channel, say, Facebook
    • “Owned social” is when a company owns the social channel, such as its own Twitter account.
    • “Earned social” is when the consumer drives the action. For example, a Facebook update or a Twitter tweet being shared with others.

And advertisers seem to be backing this up with strong intent…

“We believe the future is 25 [percent] owned, 25 paid and 50 earned,” Lucas Herscovici, vice president of digital marketing in North America at Anheuser Busch, told Ad Age’s Digital Conference attendees.

Here’s our take…Social media advertising is a significant development in the digital marketing arena.  One of its appealing aspects is the ease at which activities can be measured since the advertising offerings of the social media providers include analytic capabilities.  However, the ability to measure everything causes its own set of issues.  As regular readers of this blog know, we have written a lot about the slew of data silos that have emerged in marketing, and this area is no exception.  As more and more money gets allocated to social media advertising, it will become increasingly important to measure the effectiveness of activities across the different social channels, not just in each one individually.

Start breaking down the data silos in marketing!