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Home Social Media

Social media top beneficiary as economy forces ad budgets to shift

January 27, 2023
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  • Over half (58%) of marketers increased their spending on social media as a result of the macroeconomic environment in the fourth quarter, per new Advertiser Perceptions findings shared with Marketing Dive.
  • Other channels benefiting as brands reallocate budgets include general search (38%), connected TV (30%), mobile in-app (28%) and digital/streaming audio (24%).
  • In another sign of a brighter outlook for paid social media, the October survey of 300 marketers and agency executives found that 49% are working with more platforms — such as TikTok and Twitch — than at the beginning of 2022. BeReal is another offering to keep an eye on, the researchers said.

A significant number of advertisers have recently increased their social media budgets or redirected spending from other media toward social platforms, while only 15% reduced or paused spending on the channel, according to Advertiser Perceptions. The number of advertisers feeling reticent about social media is down significantly from the previous quarter, when 29% of advertisers paused or reduced social spending. 

The research also revealed that almost half of advertisers are not only reinstating their social media spending with current partners, they are also expanding their reach to new platforms. Many are gravitating toward places like Amazon’s Twitch to connect with audiences in more authentic and immersive ways, said Lauren Fisher, the researcher’s executive vice president of business intelligence, in a statement. 

Among the top services to watch in 2023 is BeReal, according to Fisher. Gen Z and Gen Alpha are moving to the platform not only because it encourages authenticity but also because it’s not their parents’ social networks. However, for BeReal to truly be successful, it will have to create brand-safety guardrails to attract advertiser support, she said. 

Advertiser Perceptions’ findings are the latest sign that the outlook for social media in 2023 could be brighter despite continued concerns about brand safety and transparency. In a recent Integral Ad Science study, three-quarters of media experts said they are concerned about declining consumer trust regarding social media advertising. Yet, that same survey revealed 90% of respondents planned to advertise on social platforms in 2023. 

Despite advertisers’ inability to quit social media, the platforms will have to make some changes to remain successful, Fisher noted. Transparency will be a key issue, as advertisers want a clear picture of audience reach and targeting capabilities before making heavy investments. That transparency will spill over into other digital media, as they will also have to provide measurement capabilities that prove advertiser success.

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