As more companies realize that advertising on Facebook is a necessity to reach fans and customers, a new study shows that ads play a huge role in gaining conversions through the social network.
The study, done by Convertro, an AOL company, spans 500 million clicks, 15 million conversions and 3 billion impressions — more than $1 billion of attributed revenue during Q1. It finds that while organic Facebook posts are great for mid-funnel awareness, paid posts are becoming more effective for conversions.
Among Facebook posts, paid beat out organic 13 percent to 9 percent for bottom-of-the-funnel decisions.
When compared to Twitter and Pinterest, Facebook ads were the most efficient way to gain conversions.
The study shows that organic posts on the three sites work exceptionally well for mid-funnel decision making, but lagged slightly behind paid when it came time to aim for conversions:
As Facebook, LinkedIn and others tinker with their algorithms for displaying user content, we believe this ratio—sales generated by organic versus paid—will continue to skew further towards paid social advertising, allowing marketers to control what is shown, when and to whom. While some consumer surveys have shown advertising on social to have a negligible impact on actual sales—and therefore relegating the sites to being more brand awareness—this real-world data indicates the opposite.
The most effective channel for conversions? YouTube.
The study shows that YouTube is actually the best at both introducing new products and getting people to convert, taking into account paid and organic content. Facebook was second in both product introduction effectiveness (tied with LinkedIn) and conversions (tied with Google+).
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