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Social media was the most effective online paid channel for driving impressions, clicks, and conversions at a low cost in the second quarter of 2014, according to a recent report from Neustar.

Social demonstrated the best cost efficiency of the four paid online channels examined (social, portals, networks, and exchanges), indexing 70% cheaper than the average cost for digital spend and showing a 32% decrease in cost quarter over quarter.

The reduced pricing of social inventory in 2Q14 came thanks largely to the increased use of demand-side platforms (DSPs), which allow for programmatic and real-time buying.

Digital ad networks registered a 28% increase in cost compared with 1Q14, partly due to the FIFA Men's World Cup, when marketers invested in premium placements on networks serving soccer-related content.

Below, additional key findings from the report, which was based on data from more than 220 billion digital events that occurred in the second quarter of 2014.

Reach Efficiency

Social media also had the best reach efficiency in 2Q14, defined in the report as a channel's ability to reach exclusive users (those not found on other channels) cost-effectively.

One caveat for the reach efficiency data is that it can be skewed by consumers who access channels on multiple platforms/devices, since each new cookie is viewed as a unique user.

User Quality

Exchanges and social media delivered the best user quality in 2Q14, defined in the report as a channel's ability to reach the same users consistently.

Social improved 67% quarter-over-quarter, driven by growth in impression volume and an increase in average frequency of ads being shown to the same users.

Sales Funnel

Social media and ad networks over-indexed in 2Q14 in upper-funnel activity—the likelihood that a channel influences conversion in the earlier stages of the sales process.

Exchanges over-indexed at lower part of the funnel (the moment of conversion).

About the research: The report was based on Neustar data from more than 220 billion digital events that occurred in the second quarter of 2014.

Continue reading "The Most Effective Paid Digital Media Channel in 2Q14" ... Read the full article

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image of Ayaz Nanji

Ayaz Nanji is a digital strategist and a co-founder of ICW Media, a marketing agency specializing in content and social media services for tech firms. He is also a research writer for MarketingProfs. He has worked for Google/YouTube, the Travel Channel, AOL, and the New York Times.

LinkedIn: Ayaz Nanji

Twitter: @ayaznanji