I wrote last week on Brands and Social Media that 33% of Facebook users have become fans of brands.
That sort of number begs a follow-up question to be asked. What is the value of a Facebook fan? Well according to two companies called Syncapse and Hotspex, the average value of a Facebook fan for the twenty largest corporate brands on Facebook is $136.38. (see PDF of report).
Now the Syncapse/Hotspex calculation is very different from that of Vitrue, a social media company. Last year I wrote about a new study by Vitrue on How Much Is A Facebook Fan Worth? Vitrue’s calculation was that the average Facebook fan is worth $3.60 in earned media. Vitrue calculated the value of a Facebook fan based on impressions generated in the Facebook news feed. It then applied display banner advertising pricing to the number of Facebook fans you have and viola, an instant metric.
The Syncapse/Hotspex formula took a very different approach. Rather than compare a Fan to display advertising, they looked at a series of attributes of a Facebook fan: Product Spending, Brand Loyalty, Propensity to Recommend, Brand Affinity and Earned Media Value
- Product spending — Facebook fans spend, on average, $71.84 more than non-fans over a two-year period.
- Loyalty (meaning ability to influence and promote brand loyalty within a target audience) — Facebook fans are 28% more likely to continue using a brand than consumers who are not fans on Facebook.
- Propensity to recommend — 68% of fans are “very likely” to recommend a product to family and friends (as opposed to 28% of non-fans).
- Brand affinity — 81% of fans feel a connection to the brand (versus only 39% of non-fans).
Put together these attributes in a formula and you come up with a value of $136 per fan.
So who is right: Syncapse/Hotspex or Vitrue?
Not sure. I think the value lies somewhere between $3.60 and $136.38. The Vitrue calculation I believe is too simplistic. It treats all fans the same and treats them like a regular marketing campaign. I don’t think that is true. The Syncapse/Hotspex calculation had the earned-media component of a fan’s value at $6.79, nearly double that of Vitrue.
The Syncapse/Hotspex formula sounds nice, but other studies have shown that Facebook friends, for a very large degree, are already familiar with, and have a positive opinion of, the brand they are friends of. What is the value of that consumer off Facebook? It is higher or lower than $136.38.
Are you familiar with any similar studies for B2B companies specifically?
I have seen many B2B companies flock (or perhaps have been herded) to create Facebook pages recently – many of which will get no benefit. Do faceback users really want to be a fan of Allied Global Ball Bearings Inc or Offshore Developers R Us Inc ?
Personally, I can see no (or very little) benefit for B2B companies on Facebook but would love to see some hard stats one way or the other.
What a bunch of bogus numbers. A Facebook fan is “worth” only as much as the level of interaction they have with you or your brand. There has to be at least a dozen Facebook brand pages with thousands of fans, and yet the business isn’t making a dime (therefore setting the “worth” of their fans to zero) because they don’t know how to interact with them.
Then again, I put the word “worth” into quotes to show that dollars and cents aren’t all that fans are good for these days. But that’s an issue for another day.
Any similar statistics for the value to an SMB?