Last month Syncapse released a report defining the value of a Facebook fan. The company estimated that each fan is approximately $170, this includes what they will spend and what they will recommend to other non-fans. The number may seem high to some, Syncapse notes that is just an average dependent on the number of fans and price point of a brand’s product. For example, Coca-Cola’s fans have less value than Zara’s because the price point is so much less for Coca-Cola products.
There are a lot of questions that a number like this introduces.
- Many people ‘like’ brand pages only for contests or coupons. Can these fans value be included with the value of more loyal fans?
- People will ‘like’ luxury brands only to be attached to that brand, with no intention of ever spending anything on a Porsche or a Hermes purse. These brands need to adjust for the fans that have a Bentley in their newsfeed, not their driveway.
- There also needs to be some consideration for the social media content a brand produces. There are brands that are so good at social media I follow them regardless of how I feel about the product.
These questions are important, however Syncapse’s report cannot simply be dismissed. It’s a lot easier to sit behind a white paper and critique it, than to come up with my own equation for ROI.
There is a need for an ROI in social media, because there is an idea that social media is free. The Oreo superbowl ad is a great example of this. Many people talked about how easy they pulled off the tweet. The cost was less than a Superbowl commercial, but they had a team of ten people on hand to make it. They were waiting for their moment, and found a great one, but it seemed to lead a lot of people to ask why their brand can’t do the same?
Facebook is free to sign up for and free to use, but there are costs to a social media campaign. Oreo had copywriters, social media specialists and designers at the ready, on a Sunday, no less. Paid ads and promotion of your brand’s social media are additional costs. In order for companies to invest in social media they need to be given some idea of the value of a fan, $170 is a good starting point.
Have you experienced the assumption that social media is free or cheap? Do you have a formula for determining the worth of a fan? Share your thoughts in the comments.