From my previous employment, one quote on social media marketing, especially like / fan / follower acquisition strategy has stuck in my head. A colleague once said, “If all those who liked my brand’s page on Facebook, bought the product once, my business plan for the year is done!”
This quote came back to my mind instantly, when I read two articles on HBR recently – the first one is about calculating the value of a like, gives an elaborate formula for value of a like (VOAL). Which tries to calculate how much you spent in getting a customer by spending to acquire a fan. It loosely bases the calculation on selecting conversion’ as either average sale price or average lead value. The second one, the value of a like (different article), is a very interesting summary of 23 experiments done over four years involving more than 18,000 people. It presents 3 interesting conclusions of these studies and adds a 4th to state how one can better leverage this like.
But first, going back to my point on achieving the business plan, tucked away in the conclusion of the second article are 2 startling statistics from different surveys, in one survey of 427 marketers from U.S. companies, they found ‘80% unable to quantify the value of their social media efforts’ and in another study done among CMOs of Fortune 500 companies, they found that ‘87% acknowledged that they can’t document that social media creates new customers’.
While marketers are still figuring out what is the value of a like, the argument for chasing social media followers still is of course about increasing sales. That increased sales might be because of higher frequency of purchase or higher value of purchase. Both classical communication behaviour objectives (some might argue the later is not) that a marketer strives for through via his communication efforts. Now both of them shouldn’t be confused with a like being from ‘those who already have positive feelings towards a brand’ and hence more likely to spend and/or transact more.
Anyways, the interesting summary from these studies…
- There is no evidence that following a brand on social media influences people’s purchase behaviour in a positive way
- Liking a brand on Facebook has no enhancing effect on the purchase habits of friends
- Merely liking a page didn’t change a behaviour in a positive way
Presenting these, the article goes on to state, the means of unlocking these likes is to further advertise to those who liked you. Now, that’s a conclusion that Facebook / Twitter won’t mind :)
