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Can Engagement Really Become the New Standard?

Posted by Nick O'Neill on August 25th, 2008 9:30 AM

If you’ve gone to any of the industry conferences in the past year, you’ll have heard the same pitch from all the companies: “We’re selling engagement.” We understand that there is inherently value to brands when consumers engage in various activities within a branded environment. How much value is provided through that engagement? Nobody knows. How do you measure engagement? Also an unknown.

New Solutions Emerge

Last week news of Facebook’s new “Engagement Ads” emerged and at first it didn’t click with me but the sound of it is pretty ominous. Today MediaPost posted an interview with Facebook’s VP of Media Sales, Mike Murphy in which he says “Over the last few years, Web advertising has been all about demand fulfillment.”

The article continues, “he believes that Facebook users aren’t necessarily seeking to execute tasks or fulfill specific demands, and by nature are less inclined to click on ads that take them away from the site.” What Mike Murphy believes is something that isn’t theory, it’s fact: users on social networks do not click on advertisements and this is why Google continues to reign in the majority of online advertising dollars.

Direct sales is what advertisers want and it’s not surprising. When you can put in money into specific advertisements and you can track that advertisement to a sale, why wouldn’t you purchase more or look for other channels that can do the same thing? That’s what most are doing, but a few brave souls are beginning to explore new territory.

Engagement Advertising as the 4th Type of Web Based Ad

You are a brand manager. You are sitting at your desk trying to process a ton of data and make a decision about the next quarter’s advertising budget. You have a bunch of options including: television, newspaper, radio, mailers and online. Online is broken out into banner advertising, search advertising, email marketing, and more recently “social media” which nobody has figured out how to classify it.

If Facebook agrees with what many others are saying, the new categorization should be “engagement advertising”. Meebo has already been offering these types of solutions (as they will discuss at the upcoming Social Ad Summit) and a number of others are beginning to do the same. Ultimately all engagement advertisements boil down to one thing: the conversation.

In public relations, marketing and advertising firms there have been a number of solutions to track buzz such as Cymfony and Nielsen BuzzMetrics. These new “engagement advertisements” ultimately produce similar results. At the end of the day, Meebo or Facebook will come back to the advertiser and say “X number of people interacted with your advertisement and Y number of people are now talking about your product in comparison to Z people before.”

Still Very Early

Just as brands are cautious to enter this space, social media evangelists should be equally concerned about this hesitancy. While we alway have “attention economics” to rely on, soon enough every social media site is going to be pushing this new type of advertisement. The only problem is that the industry is still learning how to measure all of these things.

Metrics is not a new phenomenon, it’s just that technology has made it easier to measure things. Unfortunately all of us are trying to figure out ways of packaging and measuring this “new type” of advertising while at the same time selling it “as is”. Fortunately for the industry there are brands that are willing to experiment and test the waters but the windfall profits we are seeking from social media may no longer be just over the horizon.

Rather than just measuring the impact of advertising on direct sales we are now entering a phase where we monitor the impact of advertising on conversation. While there are already systems in place to monitor the conversation, it was previously challenging to influence the conversation on a large scale. What social networks are now providing is a way to influence consumers’ conversation en masse.

The real question now is: can influencing the conversation on a large scale result in sales? If it can, how do we measure the correlation between conversation and sales? Is this really the secret key to social networks generating large amounts of revenue?

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This entry was posted on Monday, August 25th, 2008 at 9:30 am and is filed under Analysis. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Viewing 5 Comments

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    Engagement is a hard item to track... and I agree it is all about the conversation. The problem with the conversation trackers (buzz trackers) is that they are following frequency of mention not engagement. Frequency of mentions really are the loudest person in the room the problem is compounded by the speed at which User Generated Content is being created, more UGC will be created in the next two years than all content that has ever existed. I see engagement measurement being made up of two elements, interactions (we used to call this the click stream, but now it is broader because social is no longer about walled gardens) and influence....how influential is the person performing those interactions. There is little doubt that engagement makes sense for measuring social interactions and will become the new measure... it will take one major advertiser to switch to that metric...getting that one major advertiser will require more than traditional metrics...it will require customer intelligence
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    Another good point.

    Not one of the advertising agencies we have sold brand campaigns to in the last year have any idea what 'engagement metrics' are or why web folks are promoting them. Most every ad agency in the U.S. and Europe are still 100% attached to impressions and clicks. They are becoming less scared of non-traditional clicks (such as contests, Groups, virtual gifts, etc.) but that's only because they can still tie it to a user and a click.

    I'm concerned that many web2 publisher models will fail because the ad industry isn't nearly as excited about engagement metrics as it's proponents are. Very few people in ad agencies are risk takers. Very few brands they represent are risk takers. Furthermore, ad agencies are very quick to pull the plug on anything they perceive is under performing. So though they may try out new methods, if they are not getting better reported results than highway billboards or all their other existing opportunities, they'll advise their teams to never do it again.

    This is not to say the best companies won't (or aren't already) making advertisers very happy with non-traditional methods, but those are and will be the special companies with great sales teams and commitment to being an ad publisher. And I find most web companies are much more focused on their technology than being in the ad business.
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    Very interesting post. I love the "Engagement Advertising as the 4th Type of Web Based Ad" !
    You and your readers guys may also enjoy a recent presentation I published on "Social Media Futures", here : http://www.mediafuturist.com/2008/07/the-future...
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    It's the right question to be asking. Have you spoken to Insight Express or Dynamic Logic to see whether they are looking to correlate the kind of activity with traditional brand awareness and attitudinal metrics?
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    Hi Liza,

    No I haven't but I definitely will look into that!

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