Study: Social Media Not So Hot For Advertisers


Are you getting tired of your clients telling you they’re getting results with social media? Here’s some new data to help you in your battle for that budget. MediaPost has the details about a biannual study with CMOs conducted by the American Marketing Association, Deloitte and the Fuqua School of Business at Duke University.

The study says marketers spend about 11.7% of their budgets on social media and that’s a lot less than what was projected seven years ago. One big reason given: lack of ROI, one of radio’s big strengths, especially with recent data that’s been released by Nielsen and iHeartMedia.

According to the study, social media lacks any type of ROI measurement. Nearly half the respondents reported they have not been able to “show how their spending on social media has benefited their business,” and only 4.6% said it “contributes very highly to company performance.” Respondents estimated that their overall marketing spending on social media represents 7.5% of overall revenue but 11.3% of their total corporate budgets.

You may recall, back in October, Nielsen released an R.O.I. study that pointed out radio was delivering a 17-1 R.O.I. for four major department store brands. This data showed radio delivered a 16-1 return for two mass merchandise retailers, a 10-1 return for two home improvement brands, and a 3-1 return for three fast-food restaurant brands. Nielsen said the data it collected shows the two home improvement brands that implemented radio campaigns saw a 4% increase in sales. The brands also saw an 8% increase in total number of buyers and a 2% increase in transactions. The two mass merchandisers that executed radio campaigns experienced a 1% increase in overall sales, a 2% increase in total number of shoppers, and 2% in dollars-spent-per-transaction. At the three fast-food restaurants that implemented radio campaigns, a 6% increase in sales was recorded, a 6% increase in consumers, and a 1% increase in dollars spent per purchaser.


  1. I wonder if any observant radio salespeople have noticed that people are paying a small monthly fee to NOT see ads on their web sites right margin. The offer pops up when an attempt to widen the display is made on-screen, deleting the uninvited ad.

  2. I wish I could prove it. I have a suspicion that more people are tolerating the radio spots all the way through than are watching the full online ads. Most of the subjective feedback I get includes that about the people who grumble for 4 seconds until they can click on “skip ad” – even the higher quality productions.
    Massive ad clusters is about something else. Nasty, but different.

  3. ‘Bout time we had a RadioInk article that will spoil the day of these guys who spend 90% of their day staring at their phone.
    All the advertisers will try something new in hopes of a free ride or at least improvement in their advertising ROI. The task is to hold firm until the hysteria passes. They also really enjoy watching you dance when they bring up internet advertising. Quit dancing. And don’t criticize any purchases that they’ve made. I wouldn’t hold this article in their face either.
    How happy were you when your friends told you bad news about your girlfriend?

  4. Yet the study clearly says the problem is likely not an actual lack of ROI in digital, but the absence of a reliable measurement tool. You wouldn’t say the car speeding down the highway isn’t going very fast just because the speedometer doesn’t work…

    • Fair point…. however in this case, you can’t actually see the CAR speeding down the highway… much less the speedometer. You have to understand, the consumer isn’t driving the “car”… they are simply watching the highway. If you can’t prove they ever actually SAW the car in the first place, you can’t tell anything at all.


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