Online advertising is changing scope for fashion brands

Monday, 13 October 2014
Once upon a time a fashion brand could garner thousand of likes on Facebook, just by the choice of posts. These days Facebook, like Google Ads, is a paid for service when it comes to online advertising. Google ads may be the standard advertising medium for piquing consumer interest, but Facebook,  which reported second-quarter revenues of 2.91 billion dollars, is still the social network's favourite, followed by Twitter, Pinterest, Instagram and, soon to come, Snapchat.

Nate Elliott, vice president and principal analyst at Forrester Research, said he advises fashion brands to spend online advertising dollars on Google’s search ads versus social media ads.

Marketers should be careful where they place their ad dollars

“So many brands are spending on Facebook out of fear or fascination, but neither of those are terribly good reasons to put money there,” Elliott said. “If key words work, you keep spending there, and it should be the same with social. Marketers need to be more hard-nosed. They need to see if the money they’re spending on Facebook or Twitter is actually delivering value.”

Global digital ad spend is expected to surpass 140 dollars billion this year, an almost 17 percent increase from 120.41 billion dollars in 2013, according to data from eMarketer. Google currently commands nearly a third of the market, or 32.35 percent, up from 31.83 percent last year. In 2013, Facebook made up 5.8 percent of worldwide digital ad revenues, and this number could reach 8 percent by yearend.

Facebook is hoping to catch up to Google's advertising turnover, especially in the mobile industry. Mobile ads are expected to increase by 91.7 percent this year, potentially hitting more than 36 billion dollars, and Facebook is expected to account for 20.4 percent. Google’s share is expected to drop to 44.6 percent from 46.4 percent.

As Facebook gains more market share in the online advertising game, especially with its hold on mobile and the relaunch of multitouch-attribution ad product Atlas, it might signal a shift in Google’s longtime lead in digital advertising, especially in the fashion world.

New marketing opportunities have arisen out of the online advertising and are by no means mutually exclusive from brick and mortar shoppers. For example, when a consumer buys an item at a physical store and provides their e-mail address to a sales associate, a marketer can match the e-mail to a Facebook ID using Atlas’ technology. This formidable tool can now tell a brand that a specific person saw its advertisement at a specific time and went to buy the product in-store. Previously, advertisers had no way of knowing how an online ad affectedconsumer behavior once the consumer left the mobile or desktop screen.

Nathan Hubbard, head of commerce at Twitter, told WWD last month that he expects the “buy” button to roll out to 100 percent of U.S. users quickly, as soon as a matter of weeks to a month. The company views commerce as a stand-alone revenue stream that can parallel its growing advertising business, but the two might be more interrelated, he said.

“Twitter understands their strength is that they’re a place where you can make connections and people can be influenced by other people’s decisions,” Fishman said, comparing Twitter to Facebook, which, he noted, “owns the communication channel between brands and consumers.”

Image: Burberry Facebook