05 Dec Paid, Earned and Owned Media – a response
I don’t often respond to articles I find online since there are so many written and so few of value. However, when I read Lauren Johnson’s article Even in a Mobile World, Retailers Aren’t Convinced Social Media Can Sell in Adweek, I thought I should take a moment and offer a modicum of clarity.
[ 4 minute read ]
Ms. Johnson’s article posits the idea that social media can’t sell and references a study by an e-commerce vendor who concludes only 1.5 percent of last-click transactions come from social media. She then spends the rest of her article quoting VPs and CMOs who do find long-term value in their social media campaigns.
So, does social media generate revenue?
Yes and not directly. Wait, what am I talking about?
I say yes and not directly because there are actually two distinct sides to social media, which are often mixed together by individuals who aren’t actively investing time and money in this space.
Before I explain, I need to discuss a general concept in the marketing and communications world: Paid, earned and owned media.
Paid media are the channels where you pay to discuss and display your brand message. These include areas like an ad in a newspaper, a radio spot or Google Adwords.
Paid media is an important strategy because it allows you to tap into the audience that someone else owns. CNN has earned their audience. You pay CNN to run a commercial for your brand because you have not earned that audience.
Earned media are when a brand has done something to cause someone else to talk about them without actually paying for that exposure. An example of this would be the Wall Street Journal running an article about your CEO. You didn’t pay for that. You earned it.
This is also an important strategy, as the likes of Donald Trump knows well, because this can generate a huge value for your brand without spending any money. It also often lends credibility to a brand’s efforts when an outside authority discuss what the brand is doing.
Owned media are all of those things that you have built to promote your brand, like a website, signage, fliers and the like. You own this space and can say whatever you like in it.
These are of course critical because they fuel everything else.
What does this have to do with social media?
As I said previously, there are two distinct sides to social media. There is the organic side and the paid advertising side. Each has a different function and effect on your brand and marketing efforts, and both have incredible value when executed well.
Your Facebook page, Instagram feed and Pinterest boards should all be treated as EARNED MEDIA because your company does not own these sites. You might think that you own this space, but you do not. Facebook, Instagram and Pinterest do. They are allowing you room to communicate with their users, and communication is what you should be focused on here. You should be posting in a fashion that generates conversation and encourages engagement with your brand. When done well, this can have a huge affect on brand awareness and yes, eventual sales, because the friends and family of your followers will see your brand and content whenever your followers interact with it, which increases your reach in a way that is akin to referral marketing.
You should then begin to run targeted PAID ads that drive direct sales. There are countless studies and white papers showing how brands like Dollar Shave Club have built a solid brand directly on the back of social media.
Before I sign off, I want to answer the question that Ms. Johnson’s should have asked.
Is social media worth the investment of both time and money?
In my opinion, the answer is YES, because when compared to traditional forms of marketing, like radio or television, the baseline CPM on social media is barely a fraction of what those other channels cost, and on digital we can track metrics like clicks and conversion where we could not on traditional channels.
Let me know if you disagree.