How much is a Facebook fan worth?
For major consumer brands each fan equates to $174, on average, primarily in increased sales and brand loyalty, up 28 percent from 2010, according to a new study by Syncapse, a Manhattan technology services company.
For smaller companies, tallying up the worth of their social media efforts can be more difficult. Often, they're seeing returns but don't know how to recognize or place a value on them, say experts.
"A small business doesn't have the resources to survey people all day long," explains Basil Puglisi of PMG Interactive, a digital marketing consultancy in Center Moriches, and a member of the international board of directors of the Social Media Club, a global educational organization.
In a recent survey by Manta, an online small-business community, 61 percent of small-business owners polled said they didn't see return on investment (ROI) in their social media efforts.
HARDER TO MEASURE
Big brands have many more consumers engaging with, promoting, sharing and talking about them via social media. As a result, larger brands "can draw brighter lines to ROI than the small business owner," explains Springer. There are "more signals out there to measure."
Beyond that, Puglisi says the Manta survey question -- Do you see an ROI from your company's social media activities? -- was rather broad. It "assumed a certain level of social marketing awareness from business owners that I do not think exists, and it didn't touch on the qualitative value of social media."
Qualitative value is harder to translate into dollars and cents and includes such ancillary benefits as increased brand awareness, goodwill and loyalty, things that are crucial to the long-term success of a business, says Puglisi.
Still, small businesses can take a page from the Syncapse study when it comes to measuring return, says Max Kalehoff, Syncapse vice president of product marketing.
The study looked at such factors as product spending, loyalty, propensity to recommend and brand affinity. It focused on Facebook because that's the dominant social network, says Kalehoff.
The results show the importance of turning customers into Facebook fans -- users who have "liked" or "fanned" a brand on Facebook. Fans spend 43 percent more than non-fans, the study found.
Try exploiting "customer touch points" to convert people into fans (i.e. encourage them at checkout to like your Facebook page to take advantage of discounts), suggests Kalehoff.
TARGET SPECIFIC OFFERS
To gauge ROI, you can tie coupons or offers to your page with a unique identifier code or ask new customers where they heard about you, he notes.
Dee Muma, owner of Dark Horse Restaurant in Riverhead, can see the benefit of her social media efforts just by the number of customers walking in the door. "If I suddenly went silent on social media .?.?. new customers would dry up," says Muma, who works with Ron Wood Public Relations in Calverton to assist in her social media efforts.
She uses Facebook, as well as other sites like Yelp. She'll put up specials on Facebook, and customers will mention they saw a posting. "If they love your food, they're taking pictures and sharing it," says Muma.