Just how much is each fan of your brand’s Facebook Page really worth? A new study by SocialCode puts the number at $9.56. As reported by AdAge, this number was derived from a study of over 5 million Facebook ads in multiple verticals which were placed by over 50 companies between May and September of 2011.
The research focused on the cost of getting new Facebook Page fans and on seven specific actions that brands typically want to motivate consumers to do on Facebook: install an application, enter a contest, vote in a contest, become a fan, sign up for a program, make a purchase, and enter a sweepstakes.
Using that data (shown in the chart below), SocialCode calculated the cost per acquisition by dividing the total cost of clicks by the total number of actions and came up with a Facebook Page fan value of $9.95.
Regardless of the monetary value the study places on a Facebook Page fan (which differs from study to study these days), you can trust the fact that this study demonstrates again that Facebook Page fans are easier to move to action and are more likely to convert in terms of performing a desired action than non-fans.
The SocialCode research found that the conversion rate for Facebook Page fans is 19% versus just 7% for non-fans. In fact, Facebook Page fans showed conversion rates as high as 500% in this study.
Therefore, while marketers still struggle to find ways to accurately value Facebook Page fans and social media as a whole, companies that understand the potential of that “500%” and what it means to a business in terms of brand-building, brand loyalty, and brand advocacy will be on their way to long-term success while everyone else will still be trying to muddle through the “value” numbers.
What do you think? Leave a comment and share your thoughts about the value of Facebook Page fans and social media marketing. Can your executives make the necessary leap and understand that the brand needs to be in the social media space even if you can’t provide perfect numbers yet?
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