Social is most cost-effective channel

4 September 2014

STERLING, VA: Social media was the most cost-effective digital channel in Q2 2014 and also had the best reach efficiency out of four online channels examined in a recent study.

According to the Q2 2014 Media Intelligence Report from Neustar, the cloud-based information services provider, social media was 70% cheaper than the average cost for digital spend across social, portals, networks, and exchanges.

Social also registered a 32% cost decrease from the previous quarter, which the report attributed in part to the growing use of demand-side platforms (DSPs) for programmatic and real-time buying, Marketing Profs reported.

Furthermore, it also achieved the best reach efficiency in Q2, Neustar said, having recorded 286% better results than portals, the next best channel, in terms of its ability to reach exclusive users not seen on other channels.

Digital video ad network costs increased 28% compared with Q1 2014, partly because of the influence of the FIFA World Cup, but Neustar said new and better video targeting and measurement tools will give marketers more ability to promote brand awareness, even as costs increase.

In addition, the report found that consumers who viewed ads converted to sales at much higher rates than those who used clicks alone.

In its analysis of the healthcare industry, Neustar found that consumers who viewed ads converted 2,900% more often than campaign averages compared with a rate of 100% more than campaign averages among consumers who clicked on ads.

Commenting on this finding, Rob Gatto, svp of Neustar Media and Advertising, said marketers could benefit from concentrating more on view-based conversions.

"While many marketers still place emphasis on clicks for conversions, depending on their target audience they may find much greater growth opportunity in view-based conversions," he said.

Data sourced from Neustar, Marketing Profs; additional content by Warc staff