Understanding How Social Media Advertising Drives Business Growth

Social Media Advertising drives business growth

Social Media Advertising drives business growth

As advertisers grapple with shrinking marketing budgets against ever-increasing sales and customer acquisition targets, there is greater pressure on marketing dollars to work harder than ever before. When you add continuous innovation to marketing and media platforms, advertisers have more communication vehicles than ever before to romance their target audience – and consumers have more communication vehicles than ever before to listen to (or ignore) these messages. We continue our series in investigating the roles certain marketing channels play in driving business growth for advertisers. We explore which communication vehicles are known to be more effective in driving sales and customer acquisition, and which marketing channels typically achieve higher return-on-investment. In studying the roles various marketing channels play in driving key performance targets across a number of verticals in Australia, it is possible to draw some overall conclusions. Previous issues have explored TV, Radio, Newspapers, Magazines, Cinema, Out-of-home, and Digital and Search advertising. This issue puts the spotlight on Social media.

Social media platforms are most effective driving awareness, consideration and brand equity. Social media channels drive brand engagement and promote consumer experience with the brand. The more the brand interacts with consumers on a social/lifestyle level, the more familiar the brand becomes to the consumer, the greater the differentiation the brand achieves compared to other market players and the greater connection the brand holds with the consumer causing the consumer to feel more of an affinity with the brand and what it stands for. Strengthening brand equity does not only make sales of a specific product within a brand’s portfolio more likely, it also makes sales of all other products within the brand’s portfolio more likely and creates an immediate receptive market for new products which fall within the brand. Social media builds and strengthens brand loyalty which can insulate the advertiser from negative influences on sales such as price hikes, bad company PR, decrease in distribution channels and economic climate declines.

In my experience, social media channels typically don’t drive sales directly, with the key word being directly. Whilst social media platforms drive brand health and brand loyalty, it requires an additional platform of conversion to secure sales and customer acquisition. There are many factors which convert consumers to customers such as value/price, accessibility, etc. which social media advertising may not necessarily address but social media channels can drive traffic to other channels which can provide consumers with the information they need to make an informed purchase decision. For example, Facebook advertising can create and promote a brand’s personality, generating buzz, curiosity, appeal and attraction for the brand and its product portfolio. Consumers involved in the brand’s Facebook community are then compelled to either visit the company’s website to gather more information about the products or visit the retail outlet or distribution channel for customer service representatives or sales people to massage the lead and convert the sale. Dropping or reducing social media advertising could result in a significant decline in traffic to the company website, retail/distribution channels, etc. which could then result in a significant decline in sales and customer acquisition.

When engaging social media in your marketing strategy, the trick is to be patient and not expect an immediate or obvious impact on sales. The nature of social media dictates that any influence on sales and customer acquisition is a slow burn. Advertisers should expect to see gains in their brand health first, before the ripple effect to revenue and customer acquisition actualises. Measuring the effectiveness of social media advertising can sometimes only be possible through regression-based modelling techniques to isolate direct and indirect impacts of various marketing initiatives on sales.

I hope these observations about the role Social media can play in your marketing strategy have been useful. Please watch out for the next issue which puts the spotlight on Catalogue advertising.

For further information about media effectiveness or how you can optimise your marketing strategy, please feel free to contact Clare by emailing


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