A few days before the big Facebook IPO back in May, the news broke that General Motors was yanking nearly $10 million worth of paid ads from the network, basically saying that they don't work (that blow was later softened). Although marketers were talking about the effectiveness of Facebook ads long before GM pulled the plug, that news coupled with the worries about Facebook's long-term strategy of mobile monetization has created a very uneasy culture around advertising on Facebook.
Despite all the hubbub, only 4.3% of advertisers say they expect to decrease their Facebook advertising budget over the next year. And over half (56.6%) say they expect to increase it.
That's one of the main takeaways from an Ad Age/Citigroup survey of 658 marketers, agency executives, and media executives who refer to themselves as "decision makers" when it comes to social media marketing. It basically boils down to this: marketers really do like Facebook, but they still aren't convinced that buying ads on the site is really worth their time.
According to the survey, 86% said they use Facebook as part of their marketing strategy - which should surprise nobody. A strong social presence, especially on the biggest network in the world, is vital to almost any business model. But as a caveat, 88% said they would forgo the advertising and "implement Facebook content," which refers to all of the free means of promotion on the site (like maintaining pages, making posts). What if businesses' Facebook strategy of the future involves nothing but free promotion?
And when you look at that figure from above (56.6% think they'll increase their Facebook ad budget next year) in the context of all social media advertising, it looks a little less rosy. 72.8% of those surveyed said they expected to increase their overall social media advertising budget next year, leaving a fairly wide gap of folks who are going to make a push into social media - but not Facebook.
When looking into this discrepancy, the next set of statistics is telling. When asked if they thought Facebook was "useful in driving purchase intent," everyone was kind of blah. A little over half thought it was "somewhat useful," while 13% flat out said it wasn't useful. Nearly one-fifth of respondents said they didn't know. That means one-third of these marketers either have no idea or have no faith in Facebook as a marketing platform.
Still, it's clear that Facebook is still a place you have to be as a marketer, for now. 55% say they already run ads on the site, and nearly 9 out of 10 use Facebook in some sort of marketing capacity. If you don't currently employ a major Facebook media strategy, you're simply falling behind.
And Facebook is making moves to appear more attractive to advertisers. Facebook Exchange, a real-time ad bidding platform, is in the pipeline for one. There are even rumors of a location-based mobile ad service launching some time in the future.
Plus, Facebook ads just started appearing on third-party sites.
And if mobile is the future, things may be looking up for Facebook. According to Ad Age, "marketers also expressed strong interest in buying mobile on Facebook, with nearly 28% calling it 'very important' and 36% 'somewhat important' as a marketing channel."
Last week, similar but separate reports emerged and suggested that Facebook may not be struggling with mobile monetization after all. Multiple studies of click-through rates across various types of Facebook ads showed that mobile outperformed desktop ads - and it wasn't even close.
While it doesn't look like marketers are abandoning other forms of advertising and putting all of their eggs in a giant blue basket, it does look like there is still solid interest in Facebook as a true marketing platform. Whether or not it's worth it to invest heavily in advertising on the site, however, still seems to be unconfirmed either way - at least in the eyes of many industry professionals.