Every wondered what the value of a Facebook share or Twitter follower is?
Well a new report from Chompon.com (PDF) starts to answer those types of questions as their research allows them to put a value of social action in e-commerce transactions.
In generating the report, ChompOn focused on the immediate next sale, which means that these numbers are low. That being said, they do provide a starting point in discussing the value of social actions.
- Facebook Share: $14
- Facebook Like: $8
- Twitter Tweet: $5
- Twitter Follow: $2
To how did ChompOn calculate these values? Here is their methodology:
- For shares and tweets, we were able to directly attribute sales to the original action, so we simply took the total revenue attributed to each action and divided it by the total number of shares/tweets.
- For likes and follows, we had to estimate attribution by looking at our traffic references and subtracting out purchases made through shares/tweets as well as purchases made through direct traffic.
- None of our analysis captures long-term value of customers acquired through these social channels – which means the true value per action should be even greater.
- Gross revenue depends on the products/services being sold, but due to the diverse set of ChompOn publishers, we still feel the comparison between actions is reasonable.
What do you think of these values? If you took into consideration the long-term loyalty value, how much does that change these numbers?
I find these figures highly dubious – it seems more like wishful thinking on the part of Facebook as to it’s status vis-a-vis Twitter. Since shares, likes, tweets, etc. are free to dole out by the people who use these sites (and I know many people who have “liked” their own, or friends’, pages multiple times), their value is null. I’ve never heard anyone say they bought something because of the number of “likes” they saw.
Your comments are ignorant due to the fact that you obviously do not understand the most popular and visited website in the world called Facebook.com.
The study doesn’t say that Likes or Tweets alone directly result in revenue. They analyzed the data and saw where specifically Likes and Tweets led a follower to purchase. Then they divided the revenue by the action. It’s not 100% precise, but neither is any marketing analysis. Of course there are people who just follow brands because they are asked to. But that data evens out over the aggregate. This is a good start at trying to figure out what a Like or Tweet can mean to a brand.
Very interesting way to track significance of social media marketing efforts. Numbers always give you correct measurement of your efforts in any medium. And in social media marketing numbers really matter a lot. If we can have this kind of methodology implemented in all sorts of social media platforms then it will really help every online marketer to get correct picture of his efforts.
We agree with theEARLofSWIRL. Likes or shares cannot translate our Social Media efforts into results. Likes may give a brand online popularity but that doesn’t guarantee customer loyality offline. Social Media is effective in creating brand awareness and increasing reputation. But no units are available to measure that.
There does seem to be a positive relationship Vizz between likes and customer loyalty. See latest post for more information
So far I don’t see the kind of $ being produced from Likes on my facebook page. People may click on my page many times and never buy at all.
Brand awareness is the goal of traditional advertising. “Brand trust is created by exposure– the more a company is out in the open and marketing themselves, the more potential customers believe that they have less to hide. As quoted by C. Robert Clark et. all, in The Effect of Advertising on Brand Awareness and Perceived Quality: An Empirical Investigation using Panel Data, published in February 2009: “consumers may simply prefer more familiar brands over less familiar ones.”” (I found this quote from ‘How Digital Media Can Influence Brand Loyalty and Awareness’ – February 22 by Jordan Kasteler)