Social Media Benchmarking: Why You Need to Benchmark Your Social Media Activity
By Sandra BuschNov 9
Quantifying the value of a Facebook ‘like’ or Twitter follower is something of a holy grail in online marketing. If a company could determine exactly how much each such interaction generated in revenue they could efficiently mould marketing strategies around that figure.
It’s no surprise then, that there have been countless attempts to put a fixed number on each social media user. Although many appear to have randomly assigned a cash value to each Facebook fan based on very little methodology, there are many others that have approached the topic with at least the illusion of scientific process.
Last week marked the advent of yet another one such study, courtesy of the guys over at Social Code. They took a whole host of data for fifty different companies over a few months, clocking over five million adverts during the research project.
Their findings were, perhaps obviously, indicative that fans do indeed perform more commercially desirable actions than those who are not fans.
This study puts a final figure of $9.56 as the actual value of a Facebook fan. It should be noted however, that tangible sales are not accounted for, so the knock-on effect of offline purchases are not included in these statistics.
Chicken and the Egg
There is also the very important consideration that the cause and effect relationship remains unknown. Are the fans already the most active retail group for the company, or are people more active once they become a fan? Which comes first: the ‘like’ or the product advocate? To determine this precisely would be troublesome, if not impossible.
Despite revealing some interesting data, this ambitious study probably falls short of accurately judging the value of Facebook fans, and isn’t alone in doing so. The balk of this task has produced figures as high as $136 and as low as $3.60 being quoted elsewhere, and a quick rummage through eBay shows that people value followers and likes at just a single penny.
This brings up the question of context. Each fan, like or follower is of a varying quality and can mean different things to each company, depending on industry, size and other factors.
A local bakery business offering a specific promotion is more likely to receive a significant financial revenue change with 500 likes than a multinational insurance provider is.
Initiative such as online fan/’likes’ sellers and #teamfollowback generate plenty of such ‘advocates’, but in actuality these followers are flimsy in their support of the page and cannot be compared with a true advocate of a brand who has chosen to like a page of their own volition.
We found that many of these cash-for-followers schemes actually make dummy accounts in order to fulfil the orders; rendering a social media fan base created in this way as all but worthless. It’s very hard to place each fan on this scale – most followers are neither hard-core brand advocates nor fake personas.
Augie Ray of the USAA paints a much better picture of the value of a company’s social media fan. He uses a kinetic energy analogy to describe the value of a company’s social media advocates – fans, likes, mailing lists, subscribers, followers – and suggests that their value is nothing.
This equation should clear up the argument for those that aren’t getting it yet
They only become worth anything if the company chooses to utilise its user base, meaning that all the followers and fans account for is potential, akin to holding an object up in the air. The kinetic energy is only released once the object is dropped, or rather once the company chooses to engage with the fans.
What’s In a Like?
A key aspect of Facebook likes is that they are most basic of interactions on the site. A like doesn’t prompt any further response, and it doesn’t even have to mean they genuinely like something, as thoughtfully described by our very own Dom Soar.
It’s unusual then, that so many companies not only seem fascinated with quantifying the monetary value of likes, but also appear to seek as many of them as possible. This binary approach can never reveal enough about the value of the likes themselves.
What’s more important is not the sheer number of fans, likes or followers, but rather the what, where, who and why people are talking about a brand. Social media monitoring tools like Brandwatch provide a much more detailed picture of the value of a social media user base.
A tweet, a status, a blog post, a forum comment: these online interactions are far more active and complex statements of intent than the other metrics discussed in this article. They require a greater degree of interaction, and ultimately are a deeper level of engagement with a brand than a like can ever be.
Rather than simply being able to see if someone is ambiguously following, liking or being a fan of something, by pulling in data from all over the web and allowing for subsequent analysis, monitoring tools can show with much more clarity what users are saying about a brand and only they can truly determine the strength (or wealth) of a brand’s social media presence.