Facebook & Twitter Don’t Work for Priceline Advertising

Priceline NegotiatorOnline advertising has its big 3: Google, Facebook and Twitter. But for Priceline CEO Darren Huston, only one is driving transactions – Google.  Facebook and Twitter do not work for Priceline Advertising.

“For Facebook and Twitter, we have endless amounts of money,” Huston said last week in an interview with Bloomberg. “But we haven’t found anything there.” As on of the largest spenders on online advertising, Huston’s comments are sure to create debates around the country about which forms of digital marketing are effective. It also restarts the question of whether Facebook and Twitter’s social media ads provide a return on investment for marketers in general, especially at travel and e-commerce companies.

Priceline’s online marketing budget grew 41 percent last year to $1.8 billion, outpacing its sales growth of 29 percent. Google, as the more effective source for delivering buyer traffic, is allocated about 90 percent of Priceline’s digital ad spending, according to Mark Mahaney, an analyst at RBC Capital Markets in San Francisco.

Google’s keyword search ads often grab consumers looking for a specific vacation or hotel, leading immediately to a reservation. On the other hand, Facebook and Twitter ads tend to help companies communicate with their friends and followers, and lack the ability to target intent.

Huston is therefore looking for other locations where purchase-ready consumers are engaged, including review sites like TripAdvisor and Yelp. Another potential are travel sites such as T&L and Rick Steves.

Priceline’s experience is a good reminder to marketers that ads can have multiple functions, from brand building to capturing ready buyers. Different platforms will have different results, so be sure to plan campaigns carefully, and perform lots of testing to ensure results will follow spend.

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