Why advertisers like HP see more volume on Facebook than Twitter

Market Realist

Why more competition from digital media hurts TV ad sales (Part 6 of 6)

(Continued from Part 5)

Twitter delivers a much higher CTR (click-through rate) than Facebook

In the previous few articles of this series, we discussed how although larger-reach new ad formats helped drive higher advertising growth in Facebook (FB) than Twitter (TWTR), smaller ad inventory helped Twitter with higher CPC (cost-per-click) and CTC (cost-to-company) rates. In this article, we’ll compare ad impressions, click volumes, and CTRs between Facebook and Twitter.

According to Resolution Media, “Considering what advertisers get in exchange for their investments, Facebook’s more extensive reach and generally lower prices enabled advertisers to achieve much greater impression and click volume. The impressions offered by Facebook exceed those of Twitter by so much that Facebook consistently delivers more clicks despite offering a much lower CTR on average. In fact, Twitter delivered a much higher CTR throughout 2013.”

 

Advertisers achieving greater click volumes

Resolution Media is an agency that handles clients such as FedEx (FDX), Hertz (HTZ), and HP (HPQ) for social media advertising. According to the agency, “Many advertisers included in the Resolution Media Social Advertising Quarterly Trends Report utilized Facebook ads primarily to generate awareness, not engagement or direct-response actions. In these cases, advertisers optimize for reach and frequency, not CTR or even CPC. Not surprisingly, CTRs also vary greatly within Facebook across devices (mobile, tablet or desktop) and across ad placement (newsfeed vs. right rail), with the highest rates seen on the mobile News Feed.”

Resolution also commented, “Twitter ads, on the other hand, generate clicks at a much higher rate as advertisers integrate them tightly with broad trends and conversations, serving up straightforward messaging and content directly into relevant conversation streams. Importantly, Twitter ads appear within a less cluttered environment than Facebook ads, in the user’s Twitter timeline with few additional advertisers. Throughout 2013, advertisers across all verticals sought to fine-tune Twitter ad strategies by integrating Twitter with other channels, relevant content, promotions, and news and announcements. These efforts collectively drove up the average CTR, reflecting a high level of engagement.”

To learn more about investing in technology and media stocks, see the Market Realist series Android could represent over 50% of worldwide devices by 2015.

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