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Social media advertising is grossly underpriced, Gary Vee tells Sydneysiders

Facebook and other forms of social media advertising are grossly underpriced, while brands relying on Google Adwords, email, direct mail, or events are doomed to irrelevance, instafamous marketer Gary Vaynerchuk has told an audience of Sydneysiders.

“If you think Google Adwords, and email, and direct mail, and events, and everything else are going to get you to the next chapter, you will lose,” he told the audience during a Business Squared event at Sydney’s Luna Park. “All those things I mentioned, work. They’re just priced appropriately, or grossly overpriced.”

Social media, however, is “grossly underpriced.”

“We work with Budweiser, and Pepsi, and GE… none of these companies are remotely close to spending enough money on Facebook. Not even close,” he said.

“When they wake up – they’re about two years away from waking up – and they start pouring the right amount of money into those platforms, you will no longer be paying $6 CPMs infront of any citizen in Australia that you want.

“When that happens in 24 months, and they start spending the right money, you’re not going to have enough money to reach the people. Nobody here’s running to the TV station to run tonnes of television commercials. Because they’re too expensive for you. And that’s what’s going to happen on Facebook and Instagram.”

When it comes to social, Vaynerchuk suggests giving away “free content, forever”.

“It is your job to adjust to the reality of the situation, and the reality of the situation is if you do not know how to make written words, pictures, video or audio sound for the phone that we all hold in our hand, across the ten platforms called Facebook Instagram, Snapchat, YouTube, LinkedIn, you are irrelevant.”

“Every single person’s business or ambition will grow exponentially tomorrow if they spend the next 13 years giving away free content, forever. Seems super non natural – how do you monetise, how do you do this? The person who holds their breath the longest wins. It’s just very simple.

Vaynerchuk stressed the importance of Facebook in this new era of marketing, claiming: “We’re living through a ridiculously phenomenal era. It’s called the Facebook era.”

“If you are not spending a disproportionate amount of your money and time and energy in 2018 on Facebook and Instagram, you are leaving significant upside for what you’re trying to achieve on the table. This ship has sailed, this is not a debatable issue anymore,” he warned.

Turning his attention to the influencer market, Vaynerchuk said: “When I look at the prices for the Australian market of attention, it’s even better than the US market. When I look at the Australian influencers, what they’re asking for for shoutouts, compared to the US market – even though they’re getting more organic reach, not less – it’s not even funny.

Speaking to those in the audience who sell a physical product, he warned: “All of you better deeply become practitioners in what the influencers marketplace looks like – how much does it cost to have somebody on Instagram with a following shoutout your product.

“Whether she or he has 3,000 fans or 1.9m, there is an arbitrage, because people don’t know how to price themselves. Some are asking for too much, some are asking for too little, but it’s an inefficient marketplace that you can take advantage of, because I don’t know if you guys have heard, but people are fucking living on this device.

Michael Lane, director at Success Resources Global, the company which put on the event admitted to Mumbrella: “Gary’s a unique talent, not your typical educator.”

Vaynerchuk has been branded by Melbourne Business School’s Professor Mark Ritson as a ‘philistine’ thanks to his lack of marketing education.

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