How Much Can Small Businesses Get Out of Social Media Ads and Digital Marketing?
Social media can be a powerful weapon in your arsenal or a double-edged sword. It can be a great lead source or a bottomless pit that you just throw money into. Small businesses can do really well on social media and generate a lot of sales immediately. You can build an audience by showing people that you’re more than just a brand. But as a small business owner you know that you need to be strategic when considering where to allocate your assets. In this series I want to focus on content. It doesn’t matter how well you understand your target demographic, if the content is bad, advertising is going to be bad. To produce the right content, we need to answer 3 questions. Which platforms make sense for my brand and advertising strategy? What content performs well on this platform for those within my niche? What content makes the most sense for my situation? I’ll break down each question and then in the last entry I’ll go over some examples based on the work we’ve done for our clients.
Which social media platforms make sense for my brand and my advertising strategy?
In the first article of this series, let’s start by breaking down each platform individually. We’ll give a little bit of back story on each one, explain how they work, and what kind of users you’ll find that you can advertise to.
What was once known as “Old Reliable” seems to be going the way of Sears. Like Sears, the fall from grace has everything to do with poor decision making. While this is true if you reduce both situations down to the very root, the decisions Facebook made have permanently soiled their reputation in the public eye. You can see it when looking at the number of users each year. Facebook reached their peak in 2017 and have been slowly, but steadily, losing users every year since. This is why they’ve rebranded the parent company to Meta. They recognize the permanent trust that’s been lost and are now doing everything they can to distance themselves from the very thing that allowed them to buy Instagram, Oculus, WhatsApp, etc.
So, who still uses Facebook? Well according to Statisa’s most recent numbers this past March, over half of Facebook’s users are age 25-54. So if your business is B2C and focused on attracting younger clients, you’ll want to steer clear of Facebook. If you have a B2B business or have products that are catered towards middle aged adults and older, you might want to consider Facebook ads. If you have a high end product Facebook might also be the place to start. Over 70% of adults in the US who make 75k or more a year, use Facebook. Final aspect of target demographics is gender. The majority are either male or female, with over 50% being women.
Next platform that makes the most sense to talk about is Instagram. We briefly mentioned it when discussing Facebook. Since they’re both owned by Meta it’s fairly easy to compare the two. In 2012, Facebook bought one of its larger competitors. They did this solely out of fear. Fear of losing to Instagram, yes, but also Twitter and Google. We know this because the US House antitrust committee released emails between Zuckerberg and a former Facebook executive. Mark explicitly stated that the acquisition was fueled by fear. Regardless of why they acquired Instagram, it’s been very profitable for Facebook. In 2019 Instagram made up 31.8% of Facebook’s ad revenue.
As of January 2022, Instagram’s users fall much younger than Facebook. Over 60% of their users are under the age of 35, half of that range between the ages of 18 and 24. Meaning if Facebook's audience is running a little too old, Instagram is your better option. Instagram may have a slightly higher CPC or Cost per Click, that’s because the conversion rate is slightly better on Instagram. Instagram also has higher organic brand engagement according to SocialInsider. When you look at income and gender the results are nearly identical to Facebook. So, it’s really just a question of which age group you’re trying to hit.
YouTube
The King of Long Form Content, YouTube is like no other platform. Most platforms have adjusted to fit our shrinking attention spans. However, YouTube has found great success in longer videos. YouTube started back in 2005 and at the time was just meant as a way for people to share videos with each other. Like a video letter. Quickly it became a place where gaming videos, vlogs, and sketch comedy, would do exceedingly well. Virality wasn’t common in the early days because it wasn’t taken seriously for a long time. Being one of the earliest social media platforms, YouTube and it’s creators weren’t seen as actual creatives. The same is still true for every platform when it’s first released. The difference is that now if a platform is still around for about a year, advertisers begin to look at creators as people that actually have something to offer. Compare that to YouTube which arguably took 8-10 years before it was actually considered to be something of value.
In this second era of YouTube, they’ve shied away from short content and really incentivizes creators to post videos that are at least 10 minutes long. And your videos do better the closer they get to an hour in length. The main “incentive” really unlocks at the 10-minute mark. That’s the point at which you’re able to put mid role ads on a video. Thus, quite literally incentivizing you to make content at least 10 minutes long. We’ll talk more about the actual content later in the series, now let’s discuss YouTube’s users.
As of March, YouTube has 2.8 billion monthly users, over 122 million of which are daily users. Last year YouTube brought in 8.2 billion dollars in advertising revenue. Unlike the other 2 platforms, YouTube’s user base falls more male than female. 81% of adults in the US use YouTube and the percentages get larger when you break them down by age. YouTube users tend to fall younger to middle aged. 95% of people in the US, between the ages of 18 and 29 use YouTube. That percentage dropping slightly, from 95% to 91%, when looking at 30–49-year-olds in the US. Where you really see a drop is 65 and up, only 45% of people in the US over the age of 66 use YouTube. So if your target demographic is an older crowd maybe stay away from YouTube. When looking at household income, YouTube is different in that they consistently have at least 80% of each demographic. Even down at the 30k a year range YouTube still has 83% of that demographic in their user base. Seeing that 84% of viewers bought something after seeing a brand on YouTube, it’s a great idea to target a low-income demographic if that’s the market you’re trying to reach. Even if you aren’t focused on low-income individuals, YouTube is still a wise choice if the other two criteria fit.
TikTok
The not so new kid on the block, TikTok is still the largest growing social media platform. It started out as a Chinese version of an app called Musical.ly, which was a new version of the classic, and legendary, short form content app called Vine. TikTok acquired Musical.ly in 2017 and merged the two apps nearly a year later. It began as an app of dancing and lip syncing, but TikTok quickly became so much more. The largest problem Vine had, the thing that caused them to shut down in 2012, was a lack of monetization. Vine was a free app that was also ad free, TikTok learned from their mistake and has managed to integrate ads in a non-intrusive way. Even when legislation was being threatened that would stop TikTok from operating in the US, TikTok still persevered and continued to grow. So, what sets TikTok apart from the rest?
Well, there are 2 things. First is the ability to use copyrighted material in your content. From movie scenes to music, you’re able to post pretty much anything without receiving a copyright strike. This is one of the largest benefits TikTok has, however, until recently Twitch was relatively similar. You were able to use music and watch tv shows live on stream. But recently advertisers have pressured Twitch into taking accounts down who use copywritten content. YouTube was the same way when it first started. Every platform eventually has to crack down on copywritten content, for now let’s take advantage of the opportunity while it’s there.
The second thing that sets TikTok apart is the algorithm. TikTok has the most sophisticated algorithm of any social media platform. In case you don’t know, an algorithm in this situation refers to AI that determines which videos to suggest. Essentially, it’s like a suggested items section on a much larger scale. Unlike traditional social media platforms there isn’t a home or dashboard where you catch up on friends’ posts. You don’t share other content on your personal feed. When you open up TikTok you have 2 feeds of videos, Following and fyp or for you page. There is only ever one video on your screen at a time. You don’t navigate around; you simply scroll up and down to go through the stream of videos. Both feeds seem completely random but are actually carefully curated. And while the algorithm does boost newer content, it isn’t structured in a “most recent post” fashion like every other app. The following feed is pretty self-explanatory, you follow creators, and their videos show up in this feed. But because of the way the feeds operate that doesn’t guarantee every account you follow will show up there. The more you interact with an account the more the algorithm suggests their content. Because of this a lot of people don’t even use their following feed. For the majority of those on the platform all of their time is spent scrolling the fyp.
The fyp is where TikTok’s algorithm truly shines. The way TikTok suggests content is based on content that’s similar in topic and structure, and content that similar users interact with. TikTok has a community for everyone. If you like model trains, you have #TrainTok. If you like read, you have the very popular #BookTok. Other popular communities include #PlantTok, #MovieTok, #ConservativeTok, #LeftistTok, #PropertyTok, and even #BrickTok. #BrickTok is a community of brick collectors that schedule meet ups to trade famous bricks. No, I’m not making that up. If you have a niche interest, there is a TikTok community for it. And that’s because when you like a video, the algorithm groups you in with others who like that video. Since TikToks are only 30 seconds to 1 minute on average, you’re able to like a lot of videos in the hours of scrolling you do. This allows the algorithm to group people together so many times that it’s able to perfectly predict who you are and what content you’ll like. When you open the app for the very first time it obviously doesn’t know anything about you, so it just shows popular videos. As you like things it slowly learns who you are. You go from like 1 out of every 10 videos in the beginning, to liking every single video after just 30 minutes of scrolling. It’s able to pick up on things that interest you before you even know that they interest you. It uses the likes of other people similar to you, to perfectly predict what you’ll like.
So why does the algorithm matter from a content creator standpoint? Since the algorithm knows every user so well, anyone is able to find their audience and go viral. Unlike other platforms there’s no need to seek out communities, they find you naturally. TikTok’s main focus is connecting likeminded people in order to create safe spaces for everyone. What would traditionally only benefit advertisers, benefits every single user. Which is why we saved TikTok for last, because no matter what your target demographic is, you should be creating TikTok content and growing an audience there.
About Alex
I graduated from the University of Michigan with a Bachelors in Marketing. I then relocated to Chicago for an entry level Social Media Manager job. After about a year I got in touch with a friend from college who had a cousin named Francisco, aka the Owner of Big Picture Creatives. At the time he still worked at Fiscal Web Designs but was looking to start something of his own. After hearing about the wide range of clients he was helping, I was certainly intrigued. So I decided to partner with him and help create Big Picture. We've been doing this for a few years now and I can't imagine doing anything else. Instead of helping an old-fashioned company reply to boomers complaining on Facebook, I now get to help new small businesses every single day!