75% of marketers report declining returns on social media ad spend

Social media advertising is bigger than ever, with global ad spend projected to hit $239 billion in 2025 and $273 billion by 2026. But for marketers, bigger doesn’t necessarily mean better. A new study from Taboola and Qualtrics has revealed that nearly 75% of performance marketers are seeing diminishing returns on their social media ad spend, forcing many to rethink their strategies.

Audience saturation, rising costs, and ad fatigue are some of the biggest culprits behind the drop in performance. For over 30% of marketers surveyed, diminishing returns are impacting a significant portion of their budgets. Simply put, spending more on social ads isn’t delivering the results it used to.

“Social media accounts for a large portion of performance advertising budgets, but many marketers have hit a wall,” said Adam Singolda, CEO of Taboola. “More spend just isn’t translating into better results. Marketers are looking for solutions to overcome that barrier.”

Looking beyond social media

Faced with these challenges, marketers are diversifying. According to the study, over 80% of performance marketers are trying new tactics to combat diminishing returns. More than half have already started expanding into other digital channels like native advertising, programmatic display, and search ads.

It’s a major shift for an industry that has long relied on the power and reach of social media. But as platforms become more saturated and costs continue to climb, diversification is becoming essential to sustain results.

The findings, published in The Pulse of Performance Advertising: Diminishing Returns, surveyed over 300 advertisers from brands and agencies across the United States. For performance marketers, who are laser-focused on driving measurable outcomes like sales and leads, the report paints a clear picture: social media alone can’t deliver the same results it once did.

Marketers are now navigating a tougher, more competitive landscape. Social media is still a major player, but it’s no longer the easy win it used to be. With new challenges and higher stakes, the industry is learning that putting all their eggs in the social media basket just doesn’t work anymore.