Nielsen Paid Social Media Adv Report 2013

1. Paid
Social
Media
Advertising
2013
Industry
update
and best
practices

2. 2 Copyright © 2013 The Nielsen Company.
Methodology Executive Summary
A survey commissioned by Vizu, a Nielsen
company, of more than 500 U.S. digital
marketing and media professionals was
conducted by Digiday in September
-October 2012 on current attitudes and
practices regarding paid social media
advertising. Participants were contacted
via email and asked to take an online
survey. Participants were first asked to
identify themselves as a Brand Marketer,
Media Agency, or Publisher/ Social
Platform. Each participant was then
presented with questions about their
approach to paid social media advertising
specific to that classification. Results were
summarized and cross-tabbed in order to
identify consistencies or inconsistencies
in each constituent’s viewpoints regarding
paid social media advertising in 2013 and
opportunities to improve the outlook. A
synopsis of those results is presented in
this whitepaper.
Social media has grown exponentially. One out of every 7 people in the world has
a Facebook page. Nearly 4 in 5 active internet users visit social networks and blogs.
Accordingly, marketers are flocking to the medium. Whereas their customers are
adopting the medium with purpose, however, marketers are approaching with
caution. Marketers are increasing budgets and using social media in conjunction
with other advertising channels, but return on investment (ROI) continues to be
a question. For this survey, we focused specifically on what marketers were doing
around paid social media advertising.
• Paid social media advertising is growing – three quarters of advertisers surveyed
indicated that they use this channel, and 64 percent of advertisers said they were
increasing their paid social media advertising budgets in 2013, though for the
most part the increase is modest.
• To fund this increase, advertisers are shifting budget from online and offline
budgets into paid social media advertising.
• Advertisers are increasingly viewing paid social media advertising as an
integrated, cross-platform tactic, and are running it in conjunction with other
online and offline media.
• Paid social media advertising is primarily being used to support branding-related
efforts. As a result of this and the increasingly cross-platform way that advertisers
are using the medium, advertisers “would prefer to use the exact same metrics
used in the offline medium, and additional metrics specific to the online medium”
to measure the effectiveness of their campaigns. Very few media sellers, however,
can actually provide this.
• Metrics such as likes, pins, and click-throughs are often used to measure paid
social media advertising ROI, though advertisers and agencies think sales
generated and brand lift, which are brand-related and have cross-platform
applicability, are the most appropriate metrics to use to determine ROI. Media
sellers and agencies would do well to ensure that they are able to provide these
specific metrics to attract more social advertising dollars.
• Unsurprisingly, many advertisers are doubtful or unconvinced about the
effectiveness of paid social media advertising, indicating that the growth of the
medium is being somewhat hampered by a lack of relevant, universally employed
metrics.
• There is a clear opportunity to get everyone on the same page, particularly around
metrics. Some of the things that advertisers and agencies said would increase
their use of paid social media advertising are:
–– A clear link between social media and sales generated and/or brand lift
–– Clarity around how to measure social media ROI
–– Social media benchmarks
Media sellers and agencies who invest in building out the capabilities required
to deliver these capabilities are likely to capture dollars related to social
media advertising.

3. Copyright © 2013 The Nielsen Company. 3
Introduction
How Advertisers
and Agencies Use
Social Media
Social media use among consumers has
exploded in recent years and shows no
sign of stopping. Facebook now has 1
billion active users, or one out of every
seven people in the world1
. Nearly four
in five active U.S. Internet users visit
social networks and blogs2
. Accordingly,
marketers have flocked to the medium in
order to stay in front of their customers.
The term “social marketing” or “social
media marketing” typically refers to two
practices involving social media – the use
of free tools, such as Facebook, Twitter,
or YouTube, and paid media, such as
paid ads on Facebook or sponsoring blog
content. Unsurprisingly, free tools are
popular – 89 percent of the advertisers we
surveyed indicated that they use free social
media tools. However, paid social media
advertising is close behind at 75 percent.
Among agencies, paid social media has
overtaken the use of free tools. <Fig. 1>
Social marketing, whether free or paid, is
heavily used by advertisers and agencies.
Every advertiser that we surveyed indicated
that they did something with social media,
and only 6 percent of agencies that we
surveyed said that they did not do anything
with social media.
Though paid social media advertising is
increasing, it is still a relatively new practice
among advertisers. Most of the advertisers
and agencies surveyed indicated that
they had been using paid social media
advertising for less than three years, with 20
percent indicating they had only started in
the last year, demonstrating that this is still
a maturing field.
This is also supported by the share of
budget that marketers allocated to paid
social media advertising in the last year. The
majority of advertisers (70%) indicated that
less than one-tenth of their overall 2012
online advertising budget was dedicated to
paid social media advertising. <Fig. 2>
Fig. 1: How Advertisers and Agencies Use Social Media
Fig. 2: Advertisers: Percentage of 2012 Online Budget Dedicated to
Social Media Advertising
89%
71%
USE FREE TOOLS
75%
81%
PURCHASE MEDIA AND/OR SPONSOR
CONTENT
0%
6%
DON’T DO ANYTHINg WITH
SOCIAL MEDIA
Advertisers
agencies
13%
18%
70%
1-10%
11-20%
21%+
of budget
of budget
of budget
1
Facebook, October 2012
2
Nielsen, July 2012

4. 4 Copyright © 2013 The Nielsen Company.
Fig. 3: Advertiser Outlook for Paid Social
Advertising Budgets
Fig. 4: Paid Social Ad BudgetS will grow by…
64% of advertisers
surveyed indicated
they expect to
increase their
paid social media
advertising budget
for 2013.
2%
34%
64%
Increase DecreaseStay the Same 1-10%
41%
15%
11%
11-20% 21%+
Paid Social Media Advertising Budgets are Growing, at the Expense
of Other Channels
The majority (64%) of advertisers surveyed indicated they expect to increase their paid social media advertising
budget for 2013 <Fig. 3>; however, those increases will be modest – between 1-10 percent. <Fig. 4>

5. Copyright © 2013 The Nielsen Company. 5
More than two-thirds (41%) of advertisers
surveyed said that “social media had its
own dedicated budget,” indicating that
their organization has dollars earmarked
specifically for that purpose. <Fig. 5>
However, most advertisers indicated that
they would be increasing their 2013 paid
social media advertising budget at the
expense of other channels. Nearly one-
quarter (23%) of advertisers indicated they
would be shifting budget away from online
display to paid social media advertising,
while 10 percent of advertisers indicated
they would be shifting budget away from
other online channels – namely rich media
and video.
Surprisingly, 39 percent of advertisers
indicated that they would be shifting some
of their offline budget into online paid
social media advertising, pointing to a
growing consideration of paid social media
as a cross-platform tactic.
Fig. 5: Where Dollars for Social Media Advertising are Coming From
Paid Social Media Advertising is an Integrated, Mostly Branding-Focused Tactic
Paid social media advertising is increasingly being viewed as an integrated tactic – 66 percent of advertisers indicated that they use
paid social media advertising in combination with other online advertising, and 51 percent of advertisers indicated that they run it in
conjunction with offline advertising. <Fig. 6, Fig. 7> Agencies reported a similar degree of integration. Only 5 percent of advertisers
responded that they “rarely” or “never” run their paid social media advertising efforts in conjunction with other online tactics,
indicating a low incidence of social-only campaigns.
Fig. 6: How Often Do You Run Social Ads with
Online Advertising?
Fig. 7: How Often Do You Run Social Ads with
Offline Advertising?
Most or all
of the time
Half of the
time or less
Rarely or
never
66%
11% 11%
71%
7% 5%
Most or all
of the time
Half of the
time or less
Rarely or
never
51%
31%
18%
41% 39%
20%
Advertisers
agencies
41%
None, social
media has its
own dedicated
budget
23%
From
online display
39%
From OFFLINE
CHANNELS
10%
From other
online channels
Advertisers

6. 6 Copyright © 2013 The Nielsen Company.
When asked which online tactics they
typically run their paid social media
advertising efforts in conjunction with,
advertisers’ top three responses were
online display (83%), online video (46%),
and mobile (40%). In the offline world,
advertisers’ paid social media advertising
campaigns were mostly combined with
print (52%), followed by TV (37%).
Advertisers said that the primary purpose
of their paid social media ads was
branding-related (45%), such as raising
awareness and influencing brand opinions,
whereas only 16 percent was primarily
direct-response related, such as driving
product trials or site visits. <Fig. 8> In
addition, when the campaign was a mix of
both, a quarter (25%) of advertisers said
more than half was branding-related.
Brand marketers are viewing paid social
media advertising as a branding tool,
and more often than not are running it in
conjunction with other tactics across both
online and offline platforms. Agencies and
social media sellers should ensure they
can offer brand-relevant metrics that are
applicable to the online and offline spaces
to increase their share of brand advertising
dollars in the paid social medium. Paid
social media advertising is not being
treated as a stand-alone tactic, but being
as part of a set of marketing tools to
influence brand opinions.
Fig. 8: PAID SOCIAL MEDIA ADVERTISING OBJECTIVES
Primarily branding related,
e.g. raising awareness, influencing
brand opinions
Primarily direct-response related,
e.g. driving product trials
or site visits
A mix of both--more than
half is branding
A mix of both--more than
half is direct-response
45%
31%
16%
15%
25%
29%
14%
25%
Advertisers agencies
ROI is still a Tricky Question But Cross-Platform Consistency is Preferred
Advertisers are taking a more cross-platform approach with paid social media advertising, so it’s not surprising that advertisers
desire metrics that can span across both online and offline mediums and allow them to measure the different tactics they
employ in a consistent manner. When asked what metrics they would like to use to calculate ROI, brand marketers indicated
by a wide margin that they would prefer to use the “exact same metrics used in the offline medium, and additional metrics
specific to the online medium.”<Fig. 9> This is reinforced by the fact that the majority of their campaigns’ primary objective is
brandingrelated, as relevant brand metrics are commonplace in the offline world but scarce in the online medium. This response
also demonstrates, however, that advertisers recognize there is a unique aspect of the online medium that does not exist offline
that they can use to their advantage – for example, the opportunity to validate the effectiveness of the campaign directly against
the campaign audience.
Unfortunately, only 11 percent of media sellers surveyed indicated they were able to provide these types of metrics. <Fig. 10>
The majority of media sellers surveyed indicated they could provide metrics that were “specific to the online medium.” As only
17 percent of advertisers surveyed were interested in online-specific metrics, there is clearly a disconnect between the metrics
advertisers want and what is available to them.

7. Copyright © 2013 The Nielsen Company. 7
Reflecting the fact that media sellers
typically report online-specific metrics, the
top two metrics advertisers and agencies
said they had used to measure paid social
media advertising ROI in the past were
“likes/pins” and “click-throughs.” <Fig.
11> Media sellers indicated that they
were using “click-throughs” and “views.”
However, when asked what metric is most
appropriate to measure paid social media
advertising ROI, advertisers and agencies
responded “brand lift” (52% and 35%,
respectively) and “sales generated” (49%
and 46%). Media sellers also thought that
“brand lift” was the most appropriate
metric to measure paid social advertising
ROI (52%), in addition to “shares/reposts”
(38%). There is a clear opportunity for
media sellers to capture more brand dollars
by offering relevant brand lift metrics.
This “metrics morass,” or data overload,
is preventing marketers from clearly
understanding the effectiveness of their
paid social media advertising campaigns.
The industry is going after the low hanging
fruit when it comes to ROI metrics. Likes/
pins, click-throughs, and views are online-
Fig. 9: Metrics Advertisers Would Like to Use Fig. 10: Metrics Publishers Can Provide
Fig. 11: TOP METRICS FOR SOCIAL ROI
Advertisers
Exact same
metrics
as offline
media, and
nothing
else
Exact same
metrics
as offline,
and
some
additional
metrics
specific to
the online
medium
Some of
the same
metrics from
the offline
medium,
and some
metrics
specific to
the online
medium
Metrics
specific to
the online
medium
12%
42%
29%
17%
PUBLISHERS
49%
12%
29%
11%
Exact same
metrics
as offline
media, and
nothing
else
Exact same
metrics
as offline,
and
some
additional
metrics
specific to
the online
medium
Some of
the same
metrics from
the offline
medium,
and some
metrics
specific to
the online
medium
Metrics
specific to
the online
medium
Likes/pins
Click-throughs
Views
Sales Generated
Brand Lift
Shares/Reposts
What Media Sellers Indicate They Use
What Advertisers and Agencies
Indicate are Most Appropriate
specific actions that a computer can count
out. However, what the industry really
wants is insight into the campaign’s impact
on the audience – brand lift and sales
generated. It is not a coincidence that these
metrics translate to both offline and online
mediums. Media buyers should ensure that
they are using these relevant metrics to get
an accurate assessment of campaign ROI.
Unsurprisingly, the “metrics morass” has
left the industry unsure of paid social
media advertising’s effectiveness. Two-
thirds of advertisers surveyed said that
paid social advertising “moves the needle
when combined with other efforts, but
[they are] not sure how to measure ROI”
or that “it’s a promising new tactic, but
its effectiveness is unknown.” <Fig. 12>
Six percent of advertisers surveyed flat
out said that paid social media advertising
does not work. Media sellers who are able
to provide relevant brand metrics, and who
proactively make improvements to ensure
the campaign’s effectiveness, will have the
upper hand in capturing dollars from those
advertisers on the fence about paid social
media advertising’s effectiveness.

8. 8 Copyright © 2013 The Nielsen Company.
Improvement
Opportunity
Getting on the Same Page
There is a clear opportunity for increased
collaboration between media buyers and
sellers. Nearly all advertisers indicated
that “defining the campaign’s primary
advertising objective before campaign
start” and “establishing the metric
that will be used to measure success
before campaign start” was either “very
important” or “somewhat important”
for a successful paid social media
advertising campaign. However, the media
sellers surveyed indicated that these
communications were actually happening
less than one-third of the time. <Fig. 13>
Advertisers indicated that it was important
to calculate ROI—it speaks to the metrics
morass that this figure is not 100 percent—
though media sellers indicated that this
was actually happening less than one-third
of the time.
Media sellers and buyers should invest
in systems that allow everyone involved
in the campaign to directly collaborate
around improving the campaign’s brand
performance. This investment would help
media buyers increase campaign ROI,
and media sellers’ ability to offer such
collaboration would attract more
brand dollars.
Fig. 12: Media Buyer Views on Paid Social Media Advertising Effectiveness
Fig. 13: What Advertisers Say is Important for a Successful Campaign
vs. What Publishers Say Happens for Every Campaign
Advertisers agencies
29%
33%
33%
6%
27%
27%
43%
3%
It’s eFFective and produces
measurable ROI (with ROI deFIned as
metric achieved per dollar spent)
It’s a promising new tactic, but its
eFFectiveness is unknown
I don’t think it works
I think it moves the needle when
combined with other eFForts, but
I’m not sure how to measure ROI
98%
96%
92%
32%
19%
29%
Define campaign’s primary
advertising objective before
campaign start
Establish metric that will
be used to measure success
before campaign start
Calculate ROI
Advertisers PUBLISHERS
Improvement (and
Business) Opportunity
Align Campaign Measurement
around Sales and Brand Lift
Speaking to the same “metrics morass”
that plagues the industry, 58 percent of
advertisers and 65 percent of agencies
indicated that “clarity around how
to measure social media ROI” would
lead them to increase their use of paid
social media advertising. <Fig. 14> The
confusion is so prevalent that 14 percent
of brands said “no one” monitored the
ROI of their paid social media efforts.

9. Copyright © 2013 The Nielsen Company. 9
Fig. 14: ROI Clarity Would Increase Paid Social Media Advertising Use
Fig. 15: What Would Increase Media Buyer Use of Paid Social
Media Advertising
Improvement
Opportunity
Social Media Benchmarks
Specifically, 52 percent of advertisers
and 66 percent of agencies said a “clear
link between social media advertising
and sales” would increase their use of
paid social media advertising. <Fig. 15>
Roughly half of advertisers (46%) and
agencies (53%) also indicated a “clear
link between social media advertising
and brand lift.” As noted, these are the
metrics that advertisers and agencies
think are the most appropriate for
measuring the ROI of their paid social
media advertising efforts.
In addition to clarity around how they
are doing, marketers have indicated that
they would also like to understand how
they’re doing in comparison to the rest
of the industry. Nearly half of advertisers
(44%) and agencies (48%) said that the
availability of “social media benchmarks”
would lead them to increase their use
of paid social media advertising, as well
as provide some context for their social
media performance. <Fig. 16> Currently,
advertisers receive benchmarks from a
disparate variety of sources, ranging from
internal benchmarks they keep themselves
to benchmarks from their agencies and
vendors. However, one-fifth (21%) of
advertisers say that they do not have any
social media benchmarks, leaving them
in the dark as to how they compare to
the rest of the industry. When evaluating
partners to work with, or measurement
tools to adopt, media sellers and buyers
should look for the ability to compare
their campaign to industry norms or to
internal benchmarks.
58%
Clarity around
how to measure
social media ROI
65%
Advertisers agencies
52% 46%
66% 53%
Clear link between social media
advertising and Sales
Clear link between social media
advertising and Brand Lift
Fig. 16: Social Media Benchmarks Would Increase Media Buyer Use
of Paid Social Media Advertising
44%
48%
SOCIAL MEDIA BENCHMARKS
Advertisers agencies

10. 10 Copyright © 2013 The Nielsen Company.
Marketers are increasingly viewing and using paid social media advertising as an integrated tool. Social media is no longer
being viewed as its own discrete medium but instead used alongside other tactics to achieve an overall, usually branding-
related, objective. However, there is a gap between how marketers would like to use the medium and the current reality.
This gap is the most pronounced when it comes to measuring ROI. There is an opportunity for the industry to work together
and get on the same page, especially around providing and using the right metrics.
By addressing the “metrics morass” that plagues advertisers, agencies, and media providers alike, the industry can address
the challenges highlighted and help grow the medium so that advertising spend on social media equates to consumer usage.
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For more information, visit www.nielsen.com.
CONCLUSION
ABOUT NIELSEN
About VizU
Vizu, a Nielsen company, brings offline advertising effectiveness metrics to the online medium. By providing the first real-time,
enterprise technology platform that allows digital advertisers and their partners– publishers, ad networks, exchanges and demand-
side platforms – to collaborate directly around measuring and optimizing brand lift metrics, Vizu enables brands to move consumers
through the purchase funnel, from building awareness to creating intent and preference. Used by over 60% of Advertising Age’s Top
100 Brand Advertisers and the majority of the 50 largest online publishers and networks, Vizu’s platform is now part of the Nielsen
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more, visit www.brandlift.com.
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