Is social media “lift” converting to a commensurate level of new revenue? Most likely not.
A few weeks ago, I was talking to the publisher of a community/local media company about the state of the business. I suggested that his primary competition seemed like legacy newspapers on the one hand, and social media on the other. Social media has become a de facto community information source. Facebook, in particular, allows extended conversations in which people share and comment on community happenings — even when the initial source of the information is a content-creation company like a local publisher.
The publisher disagreed on both counts. Legacy papers are not really a competitor, he said, and he views social media is an ally. Using social platforms for distribution is essential nowadays, he said. Social sharing generates significant “lift” for his organization’s content.
I didn’t push the question, but I wondered if he’d ever done any real analysis about whether that social “lift” was actually producing revenue. It’s a question too few publishers ask.
But they should. It’s less than a year ago since Bloomberg Media CEO Justin Smith argued that media companies were merely feeding on the “scraps” leftover from Facebook’s enormous advertising business, even while playing a decisive role in ensuring that the Facebook ecosystem has content that keeps users happy.
A slew of reports in the last several months serve as red flags for media companies that rely on digital advertising. The Facebook and Google duopoly doesn’t just command more than 60 percent of the total digital ad spend in the country, but nearly all of the growth — 99 percent.
And now, a new report indicates that just 14 percent of publishers’ ad revenue comes from social media — the majority of it from Google-owned YouTube, not Facebook. That’s a shockingly small percentage, especially considering that social media is often the main driver of referrals, averaging as much as a third of any media company’s total traffic.