Do Facebook likes indicate marketer ROI?
The gloves are off
Facebook likes do indicate return on investment. With more than 500 million active users, Facebook is the most visited site on the Web, even bigger than Google, with more than 30 billion pieces of content liked and shared by consumers each month. While the ROI can be difficult to measure, those likes are certainly working to increase brand awareness and engagement, helping your brand cut through some of the messages consumers are bombarded with on a constant basis. Your biggest fans can also become your biggest marketers, with studies having shown that retailers and restaurants can get up to a 15% increase in conversion rates when items are shared across the site.
A study of Facebook global best practices conducted by marketing agency Wong, Doody, Crandall, Wiener in February found that the top worldwide brands average a Facebook fanbase of more than 1.8 million. This means these brands now can effectively market to fans on the site — and at a pretty nominal cost. The average number of likes these brands get on each post to their pages is 1,456. These 1,400-plus fans are actively participating with branded content, and the proof is right there in the likes.
Facebook likes are also valuable because they help you get to know who your best customers are. We did a recent webinar with trade magazine Nation's Restaurant News, and we surveyed our attendees to find out how well they knew their customers. We were astonished to find that more than 65% had limited or no visibility into the true identity of their customers. Facebook helps businesses piece these details together, and likes are a first step in this identification process. For example, when a consumer likes your products or services, you now find core demographic information about them, because they link to your brand on Facebook.
By offering incentives like discounts or coupons to them, you can determine what motivates your customers. You can also determine transactional data, like order history and the time of day they are most likely to shop if you have online ordering through your Facebook fan page, which many retailers and restaurants are implementing. Keep posting information, promotions and deals to your Facebook fan page; not only should you see incremental monetary lift, but also a longer-term return on your investment.
With social media now a key component of marketing strategy, many clients are focusing on calculating the definitive worth of a Facebook fan. We tell them that although likes help to track page growth and provide some insight into advertising success, they are not an accurate measurement of ROI. Potential customers may like your company, but that doesn't mean you have their attention. In fact, our research indicates that anywhere from 3% to 10% of your Facebook fan base has hidden your updates from their news feeds.
True ROI depends on sales-related actions that those fans take on behalf of your brand. We counsel that your Facebook page must nurture these actions through strategic engagement. In other words, give users a reason and the means to participate with your brand, and with that, provide encouragement and opportunities for purchase. A consumer-facing brand should have mechanisms in place to accurately track both.
Campaigns, and measurements of success come in many forms, so we provide our clients a variety of ways to measure ROI. A few examples are the number of re-shares of a sale announcement, or the number of unique visits to your site via a Facebook post and what percent result in conversions. We also encourage brands to measure the number of brand-related questions from potential customers answered, and the percentage of consumers who like the page who actively engage with or re-share the page on a monthly basis. Brands can also measure success by keeping tabs on the number of coupon downloads and the number of unique visits to your site from custom tabs and what percent result in conversions.
Most importantly, we advise clients to sync their company's Web analytics with activity on the brand's Facebook page, because it's important to know which visitors come directly from your Facebook page versus somewhere else within Facebook and the conversion rates of both. Custom-developed tabs also enable direct measurement of ROI, as do campaigns that encourage both social sharing and desired outcomes, such as a number of sales or leads. Likes alone do not lead to sales, but a strong Facebook engagement strategy for fans who like your page will. Our clients have liked that counsel in the past and have had positive outcomes by using this approach.
Direct Marketing News Decision
Facebook is a dynamic tool for marketers to use to attract consumers to their brands and interact with them. However, brands should measure their success on Facebook through metrics beyond likes, which consumers often forget about quickly after interacting with the brand for the first time.
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