Tuesday, April 27, 2010

How much is a fan worth?

Mashable recently published an article highlighting some research done by a social media management firm called Virtue which looked at the value of a Facebook fan. According to their research, a fan was worth US$3.60 per year. This was based the following formula:

wall posts x impressions x $5 CPM.

And plugging in the average numbers from the 45 million fans they manage for their clients gave the following figure:

1 million impressions x 2 wall posts x 30 days = 60 million impressions a month
60 million impressions / 1000 x $5 CPM = $300,000 per month
$300,000 p/m x 12 = US$3.6 million per year per million fans.

Great! How tidy. And how easy that has made it to now explain the value of your Facebook fan page to the CEO. “We have 1500 fans, which is worth US$5400 in advertising per year. Not bad huh boss.”

Unfortunately, I don’t know if it is that simple. Surely some fans are worth more than others? For example, I would rather have Bill Murray as a fan of my Facebook page than Pauline Hanson. And even the kids at South Park know that a “chick friend is worth almost 3 times as much as a dude friend.”

There has been debate in New Zealand lately about whether or not PR should still be measured with Advertising Equivalent Value (AVE), a measurement tool that has been heavily criticized overseas. The measurement of social media and its value as an advertising channel is something that also needs debate.

Is CPM relevant when you are talking about word of mouth endorsement from peers? And how do things change if celebrities get involved, or even just the cool kid?

Perhaps an AVE kind of measurement involving a multiplier is required. It is opinion based advertising after all, closer to an editorial than it is to anything else. Seeing that one of my Facebook friends likes a certain page/band/company is worth much more to me than seeing an ad on stuff.co.nz.

Maybe Facebook itself will provide the answer as they improve on their insights page. Maybe they will end up dictating to us how much our fans are worth. Nothing would surprise me from the people who control the worlds 3rd largest population these days.

Oh, and when you have 20 spare minutes, watch this fantastic South Park episode. The guys have once again hit the nail on the head with their summation of Facebook.

Monday, April 19, 2010

A pocket knife can do lots, but not everything

I was doing some blah blah blah about social media to a class the other day, and was posed with a tricky situation.

One of the people in the class had seen, via a mutual friend on Facebook, someone talking smack about their company on their personal status update. She asked me what the company should do in that situation.

The company has no official Facebook presence (yet…), but even if they did, this person would not have been a fan or friend, so there was no way the company could officially reply on the disgruntled customer’s personal page.

So what to do?

Having mulled it over while drinking beers & watching David Attenborough (my muse) I decided that this is not a problem that can be solved by social media.

My opinion is that the best course of action would be make a phone call to the customer & try to resolve the issue that way.

Having righted the situation via a traditional channel, the hope is that the opinion of the customer would be changed sufficient that they would then tell their friends and family at a later date – maybe via social media, but maybe not.

Had this been on Twitter, a much more public forum, it would have been ok for the company to get in touch directly through the same channel. But as Facebook requires expressed permission before you can eavesdrop, and as the company did not have that permission, even acknowledging that they had heard the complaint through that channel could be construed as an invasion of privacy.

It got me thinking about one of the myths of social media. It can’t do everything.

There is a bit of talk about being wary of the social media douchebag. I think one of the signs you are dealing with a douche is that they discount any other means of dealing with issues. They think social media can do anything and everything.

In this example the problem was created by social media giving the customer a public outlet for their frustrations, however I do not think social media could have resolved it.

Going back to my favourite analogy of social media being like a barbecue, this was the equivalent of the company finding out that someone at a different barbecue had been complaining to the other gusts. But the company itself was not present and was not invited.

To crash the party purely for the purpose of changing what the complainer was saying, even if the company had come in with frankincense & myrrh to give to everyone, would only have seemed big brother-ish and defensive.

Social media can do a lot of things, like make you aware of perceptions, however it can’t do everything. It should always be thought of purely as another tool at your disposal, and you should not forget about the rest of the shed.

It was an interesting situation though. What would you have done?

Thursday, April 8, 2010

The worst Facebook page in New Zealand?

Is this the worst New Zealand corporate Facebook page?

It is a pretty big call, but it is the worst I have come across.

Where is the conversation? Where is the personality? Where is the content?

Why would I look at this page?

What is the plan behind this? What are they hoping to achieve?

Who are they talking to, prospects or existing customers?

It looks like they intend it for existing customers, as it is mostly full of information promoting programs and competitions. If this is the case, it must be intended to add value. But how much extra value is it giving? All this information is available through other mediums in a much more unobtrusive way.

They do not seem to be provoking discussion at all. There is even evidence of comments being deleted, horror of horrors!!

Sky TV must have a huge customer base, yet 272 fans on their page does not represent much of a following. 272 fans would be enough though, if they were engaged in conversation.

Maybe they are trying to talk to new customers through this channel. The videos they have chosen to display are all their TVC’s. Is that the game plan?

I really can’t tell what the strategy is behind this page. But whatever it is, it does not look like it is achieving anything. It hurts my eyes almost as much as this does.

It is republishing content designed for other mediums in a channel that is capable of so much more.

When you put a brochure in front of people, even if it is wrapped in a Facebook logo, they will treat it like any other brochure. They have a look, then throw it in the recycling bin.

Is there a worse Facebook page in New Zealand?