Every night's the Superbowl on social media. That is, during prime time, Facebook and Twitter can reach more than 100 million people every day. That's why social media is driving seismic changes in the marketing industry, and one of the most prominent companies directing that shift is SocialCode.
SocialCode's bread and butter is harnessing social media to connect brands with the largest — yet also most specific — audiences that are likely to be receptive to their social media marketing message.
The company emerged out of the Graham Holdings incubator at the Washington Post. In 2009, SocialCode CEO Laura O'Shaughnessy was out to dinner with her husband, as well as her father, Don Graham, who sits on Facebook's board. Conversation revolved around how brands that know how to navigate social media have a strategic advantage, and O'Shaughnessy thought there was the seed of a business idea there.
Running parallel around that time, the Washington Post had acquired an interactive advertising agency and Addie Conner, SocialCode's chief innovation officer, came over with that acquisition and became a co-founder with O'Shaughnessy and Cary Lawrence. Up to that point, the agency had been dealing primarily with search engine marketing, but in an effort to diversify revenue streams, Conner decided to investigate what could be done with Facebook ads, based on her knowledge of how Facebook targets.
She spent her first $1,000 budget on the ads, and saw success, so she got her budget extended.
"Within four or five days I was up to spending over $100,000 a day, and beating the margins I was getting in search," she said.
Facebook noticed the amount of money being spent and notified the Washington Post, which then tracked it back to Conner. She was able to justify the expense through the major ROI she was getting by advertising on Facebook. She set a team to work running an analysis, and building technology for the Facebook platform.
"Facebook actually opened up this whole new world where we were able to reach people based on the properties of who they were," Conner said, instead of trying to reach people with ads based on what they might search, after they've searched it.
"We were able to offer something that didn't exist at the time and to a segment of the market that wasn't even in there yet," she said.
SocialCode's first big successful campaign was American Express' Small Business Saturday. Conner said it was the first time in Facebook history that a million dollars were spent on Facebook's right hand-rail (right column). She said is was paradigm-shifting for not only social media advertising, but third party technologies like SocialCode.
In the few years since, SocialCode has seen rapid change and growth, much like Facebook and Twitter themselves. According to Senior Vice President of Marketing Max Kalehoff, SocialCode's clients include 30 Fortune 100 companies, and more than 150 of the Fortune 500.
The newest offering from SocialCode is MessageOptics 2.0., which is a social media analytics tool. Part of what this includes is Post Predictions, an algorithm which can predict the lifetime reach and engagement of a post within an hour, making it easier to decide whether to put promotional money behind that post.
Kalehoff described the "full factorial approach," which is a piece of what SocialCode can do in terms figuring out how to best reach an audience through social media. "We're able to unbundle all the elements, the copy, the images, we can swap in different images, we can swap in different headlines, different copy text, and if you take all the possible variables of creative, against all possible variable audience targets, you could easily come up with a million different variants in which to test against, and that's essentially what we do," he said.
MessageOptics 2.0 also includes other features like Facebook Comments Insights and Direct Response Insights, which provide marketers with further information how people are talking about their brand, and further insight for direct response marketers.
After four years of existence, SocialCode has six offices and around 100 employees, far exceeding what Conner could have predicted. She sees some of that growth as linked to the growth and development of the platforms themselves. For example, in 2012 when Facebook started allowing ads in the newsfeed, that benefited SocialCode as the ads are less tangential to the conversation.
"[The platforms] have actually become places where brands can inject themselves in the conversation and reach a massive amount of their customers," she said.
SocialCode also partners with Facebook, Twitter, and Instagram as a marketing developer. "We have a very collaborative relationship with the social platforms in order to advance not only what SocialCode develops, but what the social platforms develop." Kalehoff said.
This helps SocialCode stay on top of what marketers might need next. Conner spends a lot of time talking to customers and clients. And of course, there's the data.
"What we need to do is understand their roadmaps and what they're trying to accomplish and build incrementally on top of them so that we're actually adding value on top of what the platforms add themselves," Conner said.
Erin Carson has nothing to disclose. She doesn't hold investments in the technology companies she covers.
Erin Carson is a Staff Reporter for CNET and a former Multimedia Editor for TechRepublic.