Facebook and comScore Answer ROI Skeptics with New Research

Web analysis firm comScore and Facebook have released their second, highly anticipated report, The Power of Like 2: How Social Marketing Works. Their top-line conclusion: exposure to earned media and paid ads on Facebook drives “behavioral lifts in purchase behavior.”

The study comes at a crucial time fo Facebook, which needs to boost its ad business to dispel the post-IPO naysayers. Despite comScore's research indicating that ads really do work on Facebook, prompting Ford to increase its Facebook ad spending with a pre-Father's Day campaign, the fall-out from GM's decision to stop Facebook advertising because they're not convinced it's effective continues to roil the marketing waters.

“While marketers understand the importance of a channel that now accounts for one in every seven minutes spent online, many are challenged to quantify its effectiveness,” commented Andrew Lipsman, comScore VP of Industry Analysis, about the new study.

“The Power of Like research sheds new light on how brands are able to deliver earned and paid media at scale, amplify its effects from Fans to Friends of Fans, and understand how exposure to these media can drive the desired consumer behaviors, including online and in-store purchase," he added.

Keeping auto manufacturers (in particular) happy "is critical for Facebook," the Wall Street Journal commented when GM pulled out. "The auto industry is the largest pool of U.S. advertising dollars and often can make or break a marketplace. Automotive companies and car dealers shelled out $13.89 billion on U.S. ads across all media last year, according to Kantar." 

"As long as Facebook is the bedrock of consumer engagement, advertisers can't ignore it," added Craig Atkinson, chief digital officer of Omnicom's PHD, to WSJ. Facebook has to prove, he added, that "they can convert that fan engagement into a business outcome for marketers… It's about giving the finance people, who are cutting the checks, proof that its ad products work."

The The Power of Like 2 study aims to give marketers something to take to their CFO, with findings including:

• Brands can maximize social marketing programs on by leveraging a framework to move beyond Fan acquisition to delivering reach, impact, and measurable marketing ROI. 

• Using the Brand Page as a control panel, brands should focus on benchmarking and optimizing against broader marketing objectives: 

• Fan Reach - Exposure in the News Feed 

• Engagement - Fans interacting with Brand Page marketing content 

• Amplification - Viral delivery of marketing content from Fans to Friends of Fans 

• Average monthly Amplification ratios (between 0.5 and 2.0), which can increase earned media reach by 50-200%, can be optimized through Fan Reach and Engagement and paid advertising strategies. 

• Facebook’s unique marketing channel enables Paid, Earned and Owned Media to be leveraged in a cycle of brand impact as these communications can be supplemented through Sponsored Stories and Promoted Page Posts.

• Exposure to Facebook Premium Ads drove significant lifts in both online and in-store purchase incidence and highlights the importance of using view-through display ad effectiveness.