Why marketers should cut social media budgets

All too often, brands invest millions of dollars into social media for the wrong reasons. Paid advertising is a more effective way to acquire new customers than investing time and money into a social media presence.

The key to marketing success is to reach as many category buyers as possible. Your users need to be aware of your brand.

It’s a relatively simple concept. If someone thinks of your brand at the point of purchase, it increases the likelihood of a sale. So why do brands still invest so much into their social media presence?

According to The Journal of Advertising Research, social media attracts people who are familiar with, or heavy buyers of a brand. Think about it – you probably wouldn’t like a brand on Facebook unless you’ve already made a purchase with them or you’re already aware of their presence. If you’re going to acquire new customers, it’s important to reach out to new users and make sure they’re aware of your brand. Invest in higher reaching channels rather than focusing on your existing social media followers.

The proof is already out there. Brands will often back away from traditional high reaching mediums (such as television) to invest in social media, only to see a decline in sales. The Pepsi Refresh Project is a perfect example. Pepsi reduced its television investment to finance its social spend. While the project was live, Pepsi saw a consistent decline in market share, resulting in a loss of over $4o0 million.

Although this doesn’t mean that brands shouldn’t exist on social media. Social media can be a great tool for customer service, it can boost SEO and act as a content hub for thought leadership initiatives. Paid social advertising is a great way to reach users outside of your current social media following and drive customer acquisition.