media update’s Nikita Geldenhuys summarises the basics of advertising on social media and shares insights from South African agencies working with or representing social media networks in the country.

We look at the consumer-focused social media platforms with the largest user bases in South Africa – Facebook, Twitter, and YouTube – and at LinkedIn as a platform geared to B2B, professionals, and high net-worth individuals.

1. What social media advertising options are available in South Africa?

Facebook offers adverts across Instagram, Facebook, and its Facebook Audience Network. On Facebook itself, adverts can appear in the user’s Newsfeed or on the desktop version’s right-hand column. These adverts can include a simple photo or a video. Marketers can also choose from the carousel, slideshow, and canvas formats for their adverts.

Twitter offers adverts in the form of Promoted Tweets, Promoted Accounts, Promoted Trends, First View and Twitter Audience Platform. Twitter also allows marketers to combine these products into campaigns for reaching different goals.

Advertisers can choose between YouTube’s in-stream advertising and video discovery advertising, previously known as in-display advertising.

South African marketers can use LinkedIn’s Sponsored Content, Sponsored InMails, Text Ads, and Dynamic Advertising, which uses the member’s profile picture, the advertiser’s logo and a call to action.

2. How does social media advertising pricing work?

On social media platforms, advertisers running campaigns often only pay for the actions they want people to complete. Advertisers are charged per view, click, or other actions they require people to perform in order to reach their campaign objectives.

The amount that advertisers are charged for each of these actions is often determined in ad auctions. These auctions happen each time before a user sees an advert on a social media platform. In an ad auction, a number of adverts are weighed up against each other before one is chosen and displayed to the user.

Many auction-based systems allow advertisers to bid either automatically or manually. Manual bidding, sometimes called maximum bidding, lets advertisers select how much an action by a user is worth to them or how much they are willing to pay for each action.

When that advertiser wins in the auction, they don’t necessarily pay the amount they set. Instead, they only have to pay more than the bid that came second in the auction. This is called a second-price auction. Twitter and LinkedIn sell adverts in second-price auctions.

On Facebook, adverts win auctions based on their highest total value, which is a combination of the advertiser’s bid, the quality and relevance of adverts, and the estimated action rate of the audience.

YouTube’s in-stream advertising is charged on a cost per view rate. With video discovery ads, advertisers pay every time someone clicks on their thumbnail ad. With in-stream ads, the average cost per click is determined by the level of competition in the industry and the audience being targeted. Advertisers only pay if viewers don’t skip the advert.

3. How affordable is social media advertising?

It can be very affordable when compared to traditional advertising, says Bianca Quinn-Diavastos, MD of 25AM. “Social platforms’ advertising options are mostly based on performance, which means that if you are focusing on video views or clicks as a conversion point, you will only pay once there has been a conversion.”

She explains advertisers can spend as little or as much as they want, which means companies of any size can reach customers with any budget. 

Keep in mind, though, that demand for advertising space can increase costs. As Lana Mouton, YouTube team leader at the digital marketing agency and Premier Google Partner Net Age, explains that advertising costs on social media platforms are dependent on the industry vertical that brands compete in.

While social media advert prices are higher in industries where lots of brands compete for advertising space, these adverts, and online adverts, in general, have many benefits that traditional advertising doesn’t.

Marius Greeff, founder and director of Turn Left Media, which represents LinkedIn in South Africa, explains: “Social media offers scale, engagement, frequency, and a level of intimacy with clients at a comparable price point, which is hard to beat by other mediums.”

That said, Greeff reminds us that no single advertising channel can function in isolation: “Each opportunity serves a unique purpose across different stages and roles within the consumer funnel. Some channels are geared towards the consideration stage and approach, while others more effectively service customers when they are exercising their intent to purchase, or looking for more information.”

4. How do the different social networks compare in advertising cost?

Mouton explains that, in order to compare social advertising platforms, it’s necessary to compare on the basis of the same metric. “Cost Per Thousand Impressions (CPM) is generally used across digital and traditional marketing. However, this is not really a question which can be answered definitively, as there are too many variables which affect cost and value across platforms, formats, targeting, and campaign types.”

YouTube

Mouton’s opinion is that the cost of advertising on YouTube is generally lower than on Facebook, Twitter, Instagram and LinkedIn. “In our experience, and once again we must highlight the fact that it really depends on a variety of factors, we have found that the average CPM on YouTube can range between R8 and R100, while cost per view can range between R0.80 and R2.40 per view.” But video advertising also comes with the cost of video production, which should be factored in.

LinkedIn

Greeff is also frank about advertising on LinkedIn, describing costs as “higher than what you would find on other social and intent-based media”. But because of its audience, first-party data targeting, and level of engagement, LinkedIn adverts can produce leads with a high-lifetime value.

Twitter

Twitter’s ad sales partner in Africa, Ad Dynamo Johannesburg, are seeing results with costs in line with that of other platforms in the video space especially.  Its MD, Crayg Hitzeroth, explains that Twitter’s adverts reach consumers on a different level than many other platforms.

“Twitter is the only social media platform where people share their intent and this allows brands to reach their prospective clients in the moment when their intent and likelihood to convert is at their highest.”

Facebook

Lisa Steingold, marketing manager at Popimedia, a Facebook Marketing Partner, recommends that marketers understand how they are spending on advertising over time. “Marketers need to define their business objective and only then choose the relevant advert type. They also need to understand their own ad-spend over time, as this will influence the cost of their campaigns.”

There are many factors for brands to consider when they choose the platform, advert format, ad content, and budget for their next advertising campaign.

Understanding which networks your audience prefer and what kind of content will attract them is key. And so is realising that social media is just one advertising channel among many in South Africa, all of which work together to create touchpoints for consumers on their way through the sales funnel.

Now that you know how social media adverts are priced, read more about how social media can empower your sales team in our article, How to make social selling work for your sales team – Nikk Smit’s pointers.