The Forrester Wave : Social Advertising Platforms, Q4 2013

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1 For: Marketing Leadership Professionals The Forrester Wave : Social Advertising Platforms, Q by Zachary Reiss-Davis, December 17, 2013 Key Takeaways Marketers Spend On Social Ads But Need Third-Party Tools To Make It Worthwhile In addition to TV and search ads, marketers are spending more on influencer and advocate marketing, and especially social ads, for reach. In parallel, a new category of tool, social advertising platforms, has emerged to help marketers effectively buy these ads, manage large groups of them, target granular audiences, and measure effectiveness. Kenshoo Is The Social Advertising Platform Category Leader Kenshoo has leveraged its leading capabilities in search and bid management to jump out ahead in social advertising as well. Kenshoo dominates, thanks to its strong core platform, integrations with other tools, international capabilities, and strategy. The Runners-Up: Salesforce.com, Marin Software, Unified, Shift, And Optimal, Followed By Nanigans Some platforms offer deep analytics and optimization abilities but can t treat the ads as social content; others are the opposite. Some have great services organizations but aren t ready to serve international customers; for others, it s the reverse. Decide which of these you need, then use this report to identify which vendors offer the best fit. Access The Forrester Wave Model For Deeper Insight Use the detailed Forrester Wave model to view every piece of data used to score participating vendors and create a custom vendor shortlist. Access the report online and download the Excel tool using the link in the right-hand column under Tools & Templates. Alter Forrester s weightings to tailor the Forrester Wave model to your specifications. Forrester Research, Inc., 60 Acorn Park Drive, Cambridge, MA USA Tel: Fax:

2 December 17, 2013 The Forrester Wave : Social Advertising Platforms, Q The Seven Providers That Matter Most And How They Stack Up by Zachary Reiss-Davis with David Truog and Sarah Takvorian Why Read This Report To help marketers navigate the rapidly growing and maturing category of platforms for advertising on public social networks such as Facebook and Twitter, Forrester identified and conducted a 45-criteria evaluation of the seven most significant vendors Kenshoo, Marin Software, Nanigans, Optimal, salesforce.com, Shift, and Unified in the category and researched, analyzed, and scored them. This evaluation details our findings about how well each vendor measures up to the criteria and where the vendors stand in relation to each other. It s designed to help marketing professionals select the right technology partner to manage their social advertising spend on public social networks, including (in order of importance today) Facebook, Twitter, and LinkedIn as well as smaller platforms. Table Of Contents Social Is Starting To Expand Marketers Reach Repertoire Social Advertising Platforms Help Make Social Ads Worthwhile What We Required From Vendors To Qualify For This Evaluation Our Evaluation Considered Current Offering, Strategy, And Market Presence Each Vendor Excelled In Just A Few Areas Vendor Profiles Leaders Strong Performers Contenders Supplemental Material Notes & Resources Forrester conducted lab-based product evaluations with seven vendor companies in Q4 2013: Kenshoo, Marin Software, Nanigans, Optimal, salesforce.com, Shift, and Unified. We also interviewed 21 user companies. Related Research Documents Balance Trust With Targeting In Social Reach Marketing October 30, 2013 The Four Social Marketing Tools You Need August 7, 2013 The Forrester Wave : Bid Management Software Providers, Q November 16, , Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester, Technographics, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. To purchase reprints of this document, please clientsupport@forrester.com. For additional information, go to

3 The Forrester Wave : Social Advertising Platforms, Q Social Is Starting To Expand Marketers Reach Repertoire The first stage in the customer life cycle, discover, requires reach marketing to help people find what you offer and decide whether it fulfills one of their needs or desires. 1 To do this, you need to marshal tactics suited to reach: category search (e.g., point-and-shoot camera, not Canon S110 ), advertising (especially on TV), and word of mouth (including recommendations from advocates and category influencers). However: Reach tactics are in different stages of maturity. While TV advertising and search advertising are relatively mature, influencer and advocate marketing are not, and neither is social advertising. Marketers spending heavily on social advertising need technology tools to do it better. Social advertising generates more than 85% of revenue for both Facebook and Twitter, and marketers spend is trending sharply upward. 2 In fact, Facebook alone delivers tens of billions of display ad impressions every day as many as one-third of all display impressions online. 3 Vendors have responded with products intended to help marketers achieve outcomes that justify the effort. Social Advertising Platforms Help Make Social Ads Worthwhile As Facebook continues to transform into an advertising company, it has rapidly innovated its advertising offerings (often fast enough to confuse marketers), and Twitter has done the same. 4 However, those innovations are not sufficient for the needs of enterprise marketers. Filling this void, a new category of providers has emerged that Forrester calls social advertising platforms. We define the offerings in this category as: Platforms that help marketers buy, manage, optimize, and measure ads on public social networks such as Facebook and Twitter. To help you get value out of this channel, these platforms let you: Automate the creation and targeting of ads on public social networks. Enterprise marketers need to be able to create many variants of their ads to hone in on those that are most effective and target them precisely, often with multiple employees or agency partners working on the same campaigns. The public social networks native tools are insufficient for enterprise marketers to manage this without tedious manual work. So the vendors we examined offer tools for these tasks, similar to those that marketers rely on to place search and display ads but centered around the unique characteristics of social advertising, such as targeting based on identity. 5 Measure beyond the social network walls. Social advertising requires new ways of thinking, but in the end, it must be measured alongside established advertising channels. 6 The customer references we spoke with for this Forrester Wave spend substantial sums on social advertising, and their executives are expecting a tangible return (see Figure 1). But the analytics and

4 The Forrester Wave : Social Advertising Platforms, Q measurement capabilities of the native social network advertising tools are insufficient to do proper cross-channel measurement or to show results through the lifetime value of the customer. Social advertising platform vendors seek to fill those gaps. Integrate social advertising with other reach tactics and kinds of ads. Public social networks such as Facebook treat social advertising as an isolated team and function, separating the native tools for advertising from other forms of social reach and other forms of digital advertising. Unfortunately, this makes two key things much harder to do: integrating the advertising with other social marketing and measuring its impact compared with other tactics. The best social advertising platforms overcome this problem by enabling collaboration and integration between the social advertising and other marketing functions. Forrester recommends organizing functional teams around reach, depth, and relationship (RaDaR) goals, and these platforms should help with this transition. 7 Figure 1 Customer References Spend Substantial Sums Of Money On Social Advertising Average spent on social advertising per month for Forrester Wave customer references Less than $100,000 3 $100,000 to $499,999 8 $500,000 to $999,999 6 $1 million or more 3 The average spend per month was $512,000; a large majority of the spend was on Facebook. Base: 20 digital marketers Source: Q North America/UK Social Advertising Platforms Forrester Wave Customer Phone Survey Source: Forrester Research, Inc. WHAT WE REQUIRED FROM VENDORS TO QUALIFY FOR THIS EVALUATION To assess the state of the social advertising platform market and see how the vendors stack up, Forrester evaluated the strengths and weaknesses of the top entrants (see Figure 2). We included seven vendors in the assessment: Kenshoo, Marin Software, Nanigans, Optimal, salesforce.com, Shift, and Unified. These vendors made the cut because each has a: Standalone social advertising offering. We included only vendors with platforms designed for social advertising and capable of placing ads on Facebook. 8

5 The Forrester Wave : Social Advertising Platforms, Q Strong self-service platform and user base. For a vendor to be included in this evaluation, at least 50% of its active customer base either by number of customers or revenue had to be using the platform in a self-service fashion, not as a managed service. 9 High social advertising spend via the platform. We required vendors to have customers that spent more than $50 million on social advertising through the vendor in the 12-month period ending July 1, Critical mass of enterprise customers. Finally, each vendor had to have at least 80 named customers, with at least half of those with more than $1 billion in revenue. Figure 2 Evaluated Vendors: Vendor And Product Information And Selection Criteria Company name Kenshoo Marin Software Nanigans Optimal salesforce.com Shift Unified Product evaluated Kenshoo Social Marin Software, Social Edition Ad Engine Optimal Social.com Shift Open Marketing Cloud Unified Social Operating Platform Product version evaluated 2.1 NA NA v1 Summer 2013 Edition Vendor selection criteria The vendor has a standalone social advertising platform and is capable of placing ads on Facebook. Over 50% of the vendor s user base uses its self-service platform. Marketers have spent over $50M on social advertising in the last 12 months via the platform. The vendor has at least 80 named customers, with at least half of those over $1B in revenue. Source: Forrester Research, Inc.

6 The Forrester Wave : Social Advertising Platforms, Q Our Evaluation Considered Current Offering, Strategy, And Market Presence After examining past research, user need assessments, and vendor and expert interviews, we developed a comprehensive set of 45 valuation criteria, which we grouped into three high-level buckets: Current offering. We assessed how the vendors performed across the range of social advertising platform tasks how many of the key social advertising features each platform provides and how well it performs those functions. Strategy. We examined the strength, experience, and vision of each company s executive team. We also assessed each vendor s product development road map and what professional services and strategic services it offers and collected information on client satisfaction. Market presence. Last, we evaluated each vendor s presence in the market based on the number and size of its clients and installations, revenues, and employee base. each Vendor excelled in Just A Few Areas We found that most vendors did especially well in one or two areas of social advertising, and their origins determined which areas those were. But they lacked perspective on what marketers need. Our findings (see Figure 3): Kenshoo is the social advertising platform category Leader. Kenshoo has leveraged its leading capabilities in search and bid management to jump out ahead in social advertising as well. 11 Kenshoo received top scores for its core platform, integrations with other tools, international capabilities, and strategy. Five vendors offer competitive solutions that fit varying marketer needs. In our evaluation, salesforce.com, Marin Software, Unified, Shift, and Optimal are closely clustered in the Strong Performers category. Most help marketers manage large groups of advertisements, target them to granular audiences, and report on their effectiveness, with a transparent ad placement model. But those features have become table stakes for platforms in this space. Some offer deep analytics and optimization abilities but lack in their ability to treat the ads as social content; others are the opposite. Some vendors have great services organizations but aren t ready to serve international customers; for others, it s the reverse. It s crucial that marketers draw up a list of must-have features and look for the vendors whose strengths align; each Strong Performer has at least one capability that stands above Kenshoo and all of the other vendors in this Forrester Wave. Nanigans is a Contender for specific marketer needs. Nanigans has a solution with many large customers and a large services organization and towers above the competition in its optimization on Facebook, but the vendor needs to mature its platform s ease of use and breadth of capabilities and integrations.

7 The Forrester Wave : Social Advertising Platforms, Q This evaluation of the social advertising platform market is intended to be a starting point. We encourage clients to view detailed product evaluations and adapt criteria weightings to fit their individual needs through the Forrester Wave Excel-based vendor comparison tool. Figure 3 Forrester Wave : Social Advertising Platforms, Q4 13 Strong Risky Strong Bets Contenders Performers Leaders Kenshoo Go online to download the Forrester Wave tool for more detailed product Current offering Unified Shift Marin Software Optimal Nanigans salesforce.com evaluations, feature comparisons, and customizable rankings. Market presence Weak Weak Strategy Strong Source: Forrester Research, Inc.

8 The Forrester Wave : Social Advertising Platforms, Q Figure 3 Forrester Wave : Social Advertising Platforms, Q4 13 (Cont.) Forrester s Weighting Kenshoo Marin Software Nanigans Optimal salesforce.com Shift Unified CURRENT OFFERING Name Platform Integrations and tools International capabilities Usability Services Pricing 50% 0% 28% 22% 10% 25% 15% 0% STRATEGY Vision Experience Product road map Parent company Industry focus Customer satisfaction Other staff 50% 35% 10% 10% 0% 0% 20% 25% MARKET PRESENCE Financial strength Customers 0% 90% 10% All scores are based on a scale of 0 (weak) to 5 (strong). Source: Forrester Research, Inc. Vendor profiles Leaders Kenshoo laps the pack in current offering and leads in strategy. Kenshoo, the sole Leader in our study, is the surest option for a mainstream marketer looking to invest in social advertising. Even though it has one of the smallest user bases, both in terms of number of customers and social advertising dollars spent through the platform, its customers were extremely satisfied with it, giving it an impressive 5 out of 5 points on all eight customer-satisfaction questions. Customers especially praised its analytics, reporting, and optimization capabilities as well as its ability to combine search and social advertising data. Kenshoo has aggressively expanded its partnerships and integrations for tools it has not built itself, including partnering with Shoutlet,

9 The Forrester Wave : Social Advertising Platforms, Q Spredfast, and Tigerlily for social relationship and listening and with a wide range of marketing automation and CRM vendors. 12 As of now, only its Facebook ads are fully self-service, and it requires managed services to run ads on Twitter or LinkedIn. Strong Performers Salesforce.com s Social.com is a jack-of-all-trades with an easy-to-use platform. Compared with the other strong performers, Social.com has fewer areas of major weakness that would disqualify it from consideration altogether for some marketers, was the easiest platform to use, and has a global footprint. At the same time, there is no single area in which salesforce.com has pushed its offering far past the competition. Salesforce.com has the vision to integrate its Buddy Media and Radian6 offerings with Social.com into a single marketing cloud, but as of this evaluation, they remain accessible only through separate platforms, logins, and interfaces. Therefore, Social.com received low marks for integrations with both social relationship and social listening capabilities and with search and display advertising. Marin Software s search advertising solutions give it a leg up in analytics and optimization. Marin Software has tight integration between its newer social offerings and its core business of search bid management. The result: superior analytics and optimization capabilities as well as a previously established global footprint and a user interface (UI) available in seven different languages. However, Marin Software s social tools haven t kept up with its advertising functionality. It has no plans to expand social ad placement beyond Facebook and has the least advanced keyword targeting capabilities. Unified is strong at cross-platform social capabilities, and it covers the fundamentals well. Unified is one of the most advanced vendors at broadening the scope of social advertising onto the next generation of social networks, especially given its status as one of the first LinkedIn Ads application programming interface (API) partners. It also has advanced self-training and certification capabilities, with both tactical and thought leadership training material. However, it s the weakest of the evaluated vendors at mobile advertising (the only one without the ability to measure mobile beyond Facebook s native tools), analytics, and optimization. Shift has market-leading collaboration tools and partnerships. Shift has built strong functionality to enable advertisers, social marketers, and agency partners to work together to run campaigns, and it makes collaboration easy relative to its competition. Shift strengthens its offerings through partnerships and integrations with other vendors, including Kenshoo for search bid management, Expion and SocialFlow for social relationship, and Zuum for social listening. However, Shift s ability to optimize marketing spend and analyze results lags behind other vendors, and its reporting leaves its customers unsatisfied. It has no international capabilities and is the only vendor unable to run campaigns in multiple languages and currencies,

10 The Forrester Wave : Social Advertising Platforms, Q Optimal specializes in social reach across multiple platforms and in brand marketing. The vendor has very good audience targeting, based in part on a partnership with ExactTarget (now salesforce.com), and freemium tools for social relationship and listening. It also is the strongest at enabling campaigns across multiple different social networks. However, with this specialization come analytics and optimization focused within the limited confines of Facebook and public social networks. Optimal falls short at multicountry campaigns and international presence although its recent merger with Brand Networks will likely help. 13 Contenders Nanigans has narrow focus and strengths in optimization, analytics, and services. Nanigans has focused its platform on performance-based marketing on Facebook, which has resulted in lots of social advertising spend through the platform in both absolute dollars and dollars per account. And customers stress the quality of the optimization and analytics, the mobile advertising solution, and the ability to show value for social depth as well as social reach. 14 Unfortunately, Nanigans is the hardest to use of all the platforms in this evaluation. It also treats advertising on Facebook as divorced from other social marketing, with no integration with social relationship or social listening capabilities, and has not yet expanded to other social networks. It remains to be seen whether Nanigans can revamp its user interface and expand its offerings to support either more social networks or search and display advertising. Supplemental Material Online Resource The online version of Figure 3 is an Excel-based vendor comparison tool that provides detailed product evaluations and customizable rankings. Data Sources Used In This Forrester Wave Forrester used a combination of three data sources to assess the strengths and weaknesses of each solution: Vendor surveys. Forrester surveyed vendors on their capabilities as they relate to the evaluation criteria. Once we analyzed the completed vendor surveys, we conducted vendor calls where necessary to gather details of vendor qualifications. Scenario-based product demos. Each vendor participated in a three-hour meeting with the analyst, during which it demonstrated its product s functionality using a scenario-based testing methodology. We evaluated each product using the same scenario(s), creating a level playing field by evaluating every product on the same criteria. We used findings from these product demos to validate details of each vendor s product capabilities.

11 The Forrester Wave : Social Advertising Platforms, Q Customer reference calls. To validate product and vendor qualifications, Forrester also conducted reference calls with three of each vendor s current customers. These customer references were provided by the vendors. The Forrester Wave Methodology We conduct primary research to develop a list of vendors that meet our criteria to be evaluated in this market. From that initial pool of vendors, we then narrow our final list. We choose these vendors based on: 1) product fit; 2) customer success; and 3) Forrester client demand. We eliminate vendors that have limited customer references and products that don t fit the scope of our evaluation. After examining past research, user need assessments, and vendor and expert interviews, we develop the initial evaluation criteria. To evaluate the vendors and their products against our set of criteria, we gather details of product qualifications through a combination of lab evaluations, questionnaires, demos, and/or discussions with client references. We send evaluations to the vendors for their review, and we adjust the evaluations to provide the most accurate view of vendor offerings and strategies. We set default weightings to reflect our analysis of the needs of large user companies and/or other scenarios as outlined in the Forrester Wave document and then score the vendors based on a clearly defined scale. These default weightings are intended only as a starting point, and we encourage readers to adapt the weightings to fit their individual needs through the Excel-based tool. The final scores generate the graphical depiction of the market based on current offering, strategy, and market presence. Forrester intends to update vendor evaluations regularly as product capabilities and vendor strategies evolve. For more information on the methodology that every Forrester Wave follows, go to Integrity Policy All of Forrester s research, including Forrester Waves, is conducted according to our integrity policy. For more information, go to Survey Methodology Forrester fielded its Q North America/UK Social Advertising Platforms Forrester Wave Customer Phone Survey to 21 marketing leadership professionals. These professionals were clients of participating Wave vendors and were selected by the Wave vendors. Forrester fielded the phone survey in Q Respondent incentives included a final copy of the published report.

12 The Forrester Wave : Social Advertising Platforms, Q Exact sample sizes are provided in this report on a question-by-question basis. Panels are not guaranteed to be representative of the population. Unless otherwise noted, statistical data is intended to be used for descriptive and not inferential purposes. Endnotes 1 For Forrester s overview about the ways to reach your prospects using social marketing, see the October 30, 2013, Balance Trust With Targeting In Social Reach Marketing report. 2 According to Twitter s S-1, it had $254 million in revenue for the first half of 2013, of which $221 million was from advertising services. According to Facebook s October 30, Q, it had $5.3 billion in revenue for the first nine months of 2013, of which $4.6 billion was advertising. All of those numbers are up from all prior quarters and years. Source: Form S-1 Registration Statement, US Securities and Exchange Commission ( and Form 10-Q, Quarterly Report Pursuant To Section 13 Or 15(D) Of The Securities Exchange Act Of 1934 For The Quarterly Period Ended September 30, 2013, US Securities and Exchange Commission ( 3 We estimate that Facebook now delivers nearly 10 billion ads per day in the US. And with half of Facebook s revenues coming from outside the US and its ad rates higher in the US than elsewhere we expect that Facebook now delivers approximately 20 billion ads per day worldwide. For more context around this estimate, see the October 28, 2013, Why Facebook Is Failing Marketers report. 4 Over the summer, Facebook began a new initiative to dramatically simplify its social advertising offerings, focus them on real business objectives, and make them more social. For more information, read Zachary Reiss-Davis blog post. Source: Facebook Recognizes Need For Social, Simplicity In Social Advertising, Forrester Blogs, June 6, 2013 ( recognizes_need_for_social_simplicity_in_social_advertising). 5 For the Forrester Wave of the leading bid management platforms vendors that develop and sell a proprietary platform for managing paid search media see the November 16, 2012, The Forrester Wave : Bid Management Software Providers, Q report. 6 If you are using social advertising as a reach channel, your objective is to measure how it causes prospects to advance to the next stage of the customer life cycle, from discover to explore. If you are using it as a social depth channel, measure its ability to drive purchases. No matter what, measure across channels as much as possible, and do not treat social advertising as a silo. For more insight about this, see the November 21, 2012, Win The Social Marketing Measurement Game report. 7 Among the social advertising platform customer references we spoke with for this Forrester Wave, job titles and responsibilities ranged widely and included titles from four distinct categories. Reach goals: VP of acquisition marketing; head of user acquisition marketing. Combine different forms of digital advertising: search marketing director, also responsible for social; manager on the digital performance team. Siloed social advertising teams: head of paid social; social advertising lead. Treated social advertising as a subset of

13 The Forrester Wave : Social Advertising Platforms, Q social marketing: global head of social, also responsible for social ads; head of social paid portion of social portfolio. For Forrester s vision about how reach, depth, and relationship relate to the customer life cycle, see the July 22, 2013, Mix Art And Science For Marketing Success report. 8 Vendors in this Forrester Wave must have at least a Facebook Ads Preferred Marketing Developer (PMD) certification. Most also had one or more of the following certifications: Facebook s PMD, Facebook FBX, Twitter Partner, and LinkedIn Partner. 9 If you would like to use a fully managed service offering for your social advertising needs, in addition to the vendors that scored well for managed and professional services in this Forrester Wave, there are a number of other options that controlled more than $30 million in social advertising spend each during this period, including Adknowledge s AdParlor and SocialCode. 10 There are a total of 44 vendors that have a Facebook Ads PMD certification, and more that advertise on Facebook without the formal certification. Many of these vendors are very small companies or large companies (including Adobe) that are still growing their social advertising business client list or amount of advertising spent via the platform. A list of all of the Facebook Ads PMD partners is on Facebook s website. Source: Facebook ( 11 For more in-depth information about how Kenshoo and the other four top vendors performed in the Bid Management Forrester Wave, see the November 16, 2012, The Forrester Wave : Bid Management Software Providers, Q report. 12 For insight into how to select a social relationship platform (SRP) and how the eight top vendors compare, see the April 16, 2013, The Forrester Wave : Social Relationship Platforms, Q report. 13 Brand Networks a social relationship platform and services company acquired Optimal on October 16, 2013, and plans to keep the Optimal product and team to provide social advertising solutions alongside their social relationship solutions. All Optimal product evaluations are based on the standalone Optimal product as evaluated. However, the company size numbers reflect the new combined business. Source: Brand Networks Acquires Optimal, the Leading Social Advertising and Analytics Company for $35 Million, Brand Networks press release, October 16, 2013 ( 14 All three of Nanigans customer references spent more than $1 million a month on the platform, whereas none of the other vendors 18 references said the same.

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