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Facebook Responds to Critics With ROI Study

June 14, 2012

SAN FRANCISCO — Facebook ads promise a higher level of ROI than companies like General Motors have claimed, according to new data released by the social network in conjunction with comScore, a provider of digital business analytics.

According to the report, most advertisers (70 percent) are turning around $3 for every $1 spent. Almost half of the companies took in $5 for each dollar. The study, “The Power of Like 2,” focused on reach, brand resonance and sales.

Target was among the major brands researched. Fans who “like” the store’s page and their friends are 21 percent more likely to make a purchase there, according to the report. Similarly, Starbucks’ fans and friends were 38 percent more likely to buy something at Starbucks every four weeks than those who were not viewing the company’s marketing messages.

The study also delved into marketers who target certain time periods, such as holidays for advertising. For instance, Target saw 3.5 times more activity in the week ending Nov. 30 than the month prior. Official with Facebook said identifying a company’s key times to advertise is one strategy the site will continue to explore with its clients.

The report was issued weeks following GM’s announcement that Facebook ads were ineffective and that it was pulling out on its $10 million campaign with the social media network.

“(The findings) provide quantifiable evidence that earned media exposure can be valuable in influencing consumer behavior – and specifically the sort of behaviors that brands most want to induce, such as purchase,” Andrew Lipsman, author on the report, said on comScore’s website. “Secondly, they demonstrate that there is a latent branding effect that continues to drive increasing lift in purchase behavior weeks following exposure. Both of these conclusions provide more evidence that Facebook can be very valuable as a branding medium.”

To view the full report, click here.

Comments

  1. 1. howell clark [ June 15, 2012 @ 08:54AM ]

    the real unspoken problem here is that this type of advertising is subjective and is secondary or even further down the pike to frontline advertising. its just a part of the mix. sure hope GM'S union owners decide to send that savings back to all us little original stock owners.

 

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