How Social Media Advertising Affects Sales

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by Ayaz Nanji

The middle of the sales funnel is where social media advertising has the biggest impact, according to a recent report from Convertro and AOL Platforms.

The report was based on an analysis using Convertro’s multi-touch attribution technology of 500 million clicks, 15 million conversions, and three billion impressions that occurred in 1Q14.

In aggregate, social media ranked slightly ahead of display ads in driving conversions, but behind both affiliate marketing and email, the analysis found.

However, both social media and display advertising were found to significantly influence the middle of the path to purchase—defined in the report as after the initial interaction but before conversion (essentially, the awareness and research phase).

Below, additional key findings from the report.

Performance by Social Network

Social media platforms vary widely in where they impact the path the purchase, and how much, according to the analysis.

YouTube was the most effective network in introducing new products and driving sales for the events examined, followed by Facebook.

Paid vs. Organic

Marketers who spent on social channels registered a nearly 25% lift in conversions compared with purely organic social efforts (2.82% average conversion rate vs. 2.26%).

Conversions on Twitter increased significantly with paid spends (1.45% average conversion with organic tweets compared with 3.85% for promoted tweets).

Impact by Product Type

The impact of social media advertising varied by product category, the analysis found. For example, paid social media was effective for both introducing products and driving conversions in the subscription and heath/beauty categories, but had little impact in the food/beverage and apparel/accessories categories (where organic social had a far greater impact).