Many companies are realizing the need for social media advertising. But the description of social media advertising is a bit like counting raindrops in a thunderstorm. The trends are diverse, fast-moving and often disappear in a flash.
At least one industry practitioner believes that despite persecution concerns, social advertising is gaining acceptance and could soon be a full-fledged e-commerce channel.
Let’s take these three trends one after the other – acceptance, signal loss, and shops.
A segment of the retail industry that includes e-commerce, omnichannel and B2B has a long and successful relationship with social media advertising. But that is not the case with everyone.
“I think a lot of brands, retailers and grocers have finally accepted that social media is the best platform to reach their customers with personalized messaging on a large scale,” said Conor Ryan, chief information officer at StitcherAds, a social media company. Advertising platform
Ryan believes the Covid-19 pandemic has accelerated social advertising adoption. Companies that may have planned to invest in social advertising were forced to act.
The pandemic “put so much pressure on so many companies to act quickly that” [digital transformation] was cooped up [a few months]“Said Ryan during a live interview with the CommerceCo by Practical Ecommerce community on July 8, 2021.
The brands that made this transition accepted that they had to use social advertising out of necessity, “but then it started to work the way it always would. Lots and lots of advertisers have come to the platform – many of them have played around with it before – but now they really have embraced it as one of the cornerstones of achieving marketing and advertising goals, “said Ryan.
The long-term effects of this acceptance are unclear. But it could be that there could be more advertised products and more competition as more and bigger brands step into the social advertising space or increase their investments (sometimes spending millions of dollars).
The segments most affected could be digital native direct-to-consumer brands that used Facebook or Instagram advertising, for example, as the foundation for their business growth and success.
Loss of signal
The companies that thrive on social media advertising platforms are concerned about the loss of signal – the lack of tracking data that made some social ads work so well.
“There are many concerns about the ability to track conversions because of some of the changes that are coming from Apple and various web browsers,” said Ryan.
Apple has dramatically changed the way tracking works on its iOS devices. App makers had full access to Apple’s Identifier for Advertisers, which enabled Facebook and others to track individuals across apps, networks, and (in combination with cookies) across websites. But newer versions of iOS allow iPhone owners to choose whether to be tracked.
Depending on the source, between 65% and 90% of iOS users choose not to be tracked. Hence the loss of signal.
This trend has resulted in “a lot of focus on attribution models, measurement, reporting and the accuracy of that reporting,” said Ryan.
Social networks and their advertising platforms rely on e-commerce and launch “shop” solutions.
Examples are “Facebook shops, Instagram shops, shops switching to WhatsApp and other social networks,” said Ryan, adding that the trend towards shops is helping to fix signal loss.
“I mentioned the challenge of measuring conversions … but retargeting is also affected [by the new privacy settings]. So if you show someone a product in a shop on Facebook or Instagram, Facebook knows what product they saw and can re-address it for you. But if that happens outside of the social media network, there may be no way to track them, ”Ryan said.
While the value of a shop on a social media network isn’t limited to solving signal loss, it wouldn’t hurt businesses concerned about the performance of social media advertising because tracking by third parties is limited.
In addition, social media stores can expand a retail company’s portfolio of sales channels and enable sellers to reach consumers where they are.