Which Has A Better ROI: Yahoo PPC Ads or Twitter Marketing?

In previous blog posts, we compared the ROI of Google Adwords to Yahoo Search Marketing. What we found was not surprising: Google PPC has a much higher ROI than Yahoo, and performs so much better, that there's no real comparison. But what about comparing the ROI of a social media site like Twitter, to Yahoo PPC advertising? Which one performs better? Which one demonstrates a higher ROI?

The answer, at least in the case of one of our clients, might surprise you. Conducting extensive comparitive experimentation, our firm has concluded that, actually, Twitter delivers a better ROI than Yahoo Search Marketing, in terms of sales and cost per acquisition.

Surprising, huh?

Yeah, we were surprised, too. We created some product offerings for a client that were able to be purchased only after first following and DMing the client on Twitter. The client was a hotel and the product was room reservations. We created a strategic plan to publicize the packages on Twitter. The same type of packages, with similar prices, had been advertised on the Yahoo search network, for a few months prior. To our surprise, Yahoo didn't deliver as many sales as Twitter did!

Not only was the number of sales from Twitter higher, but the Cost Per Acquisition for Twitter was lower.

To be fair, however, the hours of labor spent on the Twitter marketing campaign really would have to be factored in to truly calculate CPA. (Of course, we'd have to factor in labor for YSM ad management, too.)

Also, we helped the Twitter sales along by driving a ton traffic to the client's Twitter feed via an e-newsletter sent out to almost 40K subscribers. The e-newsletter generated a 35% increase in the number of Twitter followers in roughly 2 days. So, we would also need to factor in the cost for the email CRM software the client used for this.

But even factoring in labor and software costs, we think that the ROI for Twitter is still better. The amount of labor required to manage and monitor the YSM campaign was probably only moderately less than the amount of labor required to generate sales through Twitter. And the email software is substantially less of an expense than what the client was spending each month on Yahoo ads.

Even being conservative and calling both sets of expenses even - YSM ad management and Twitter marketing - the fact that Twitter marketing generated more monthly sales than YSM alone proves that Twitter marketing is a better investment - at least for this client.