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The ROI of Facebook

Quantifying The Effectiveness of Social Media Marketing

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Audience Poll

• Agency or Company?• Total Marketing Budget > $50,000?• B2B or B2C?• Currently Have Company Presence On

Facebook?• Using Social Media Analytics Tool?

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The ROI Of Facebook

This presentation will be split into two parts:

• Facebook As A Marketing Channel

• Quantifying Social Media Marketing Campaigns

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The ROI Of Facebook

Facebook As A Marketing Channel

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The ROI Of FacebookPeople on Facebook

•More than 500 million active users

•50% of active users log on to Facebook in any given day

•Average user has 130 friends

•People spend over 500 billion minutes per month on Facebook

Facebook Statistics, http://www.facebook.com/press/info.php?statistics

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The ROI Of FacebookWho is a Facebook Fan?

33% of 500 Million = 165 Million Fans

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The ROI Of FacebookWhy a Facebook Fan?

Social >

Tangible Return >

Tangible Return >

Tangible Return >

Social >

Motivation

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The ROI Of Facebook

Are My Competitors Using Social Media?

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The ROI Of Facebook

Are My Competitors Getting Customers Using Social Media?

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The ROI Of Facebook

Do My Competitors Plan On Using Social Media

To Grow Their Business?

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The ROI Of FacebookThe Study

The quantitative research for this Syncapse undertaking was conducted in conjunction with Hotspex Market Research and consisted of a 25-minute survey using their online panel. Data was collected from over 4,000 panelists across North America in June 2010.

THE VALUE OF A FACEBOOK FAN: AN EMPIRICAL REVIEWJUNE 2010by Syncapse in association with hotspex

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The ROI Of Facebook

• Facebook fans reported spending $71.84 more per year than non fans.

• McDonald’s saw the largest variability, with Fans reporting spending $159.79 more per year than non-fans.

• Oreo saw the lowest value with a difference of $28.52.

Spending

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The ROI Of Facebook

• On average, Facebook fans are 28% more likely to continue using a brand than are non-fan consumers.

• Adidas had the highest variance of loyalty between fans and non-fans with 42.5% of fans indicating a heightened likelihood of continued product usage.

• Secret saw the lowest difference in loyalty, only 15.83% between the two groups.

Loyalty

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On average, 68% of Facebook fans indicated that they are very likely to recommend a product across the 20-top leading brands, contrasted by 28% for non-fans.

>>That’s 2 ½ times more likely to recommend if a fan! <<<

The ROI Of Facebook

Likely to Recommend

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• 81% of fans said they feel connection/empathy with the brand, compared to 39% of non-fans.

• 87% said they felt warmth, gratitude, happy or satisfied, compared to 49% of non-fans.

The ROI Of Facebook

Affinity

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The ROI Of FacebookTotal Value

Category ValueSpend $71.84

Loyalty $43.71

Recommendations $13.71

Earned Media Value $6.79

Cost of Fan Acquisition

-$0.47

Total Value = $136.38

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The ROI Of Facebook

Quantifying Social Media Marketing Campaigns

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The ROI Of Facebook

Return on Investment

Investment – Resources, time, or money spent on a campaign

Return – positive or negative results of a campaign

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The ROI Of Facebook

Types of InvestmentsAny resource that has cost and is used for a campaign

• Internet Connection• Desktop PC Use• Blogger’s Time• Office Space• Travel Time• Travel Costs• Parking

• Web Analyst’s Time• Ad Buys• Graphics/Creative• Administration• Campaign Planning• Reporting• Rebates, Discounts, Coupons

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The ROI Of FacebookTypes of Returns

A change in the business, positive or negative, caused by a campaign

• New Customers• Return Customers• Sales per Customer• Dollars per Customer• Additional Sales• Sales per Visit

• Brand Awareness• Profit per Sale• Cost per Sale• Cost of New Customer• Incremental Sale Cost• Incremental Sale Profit

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The ROI Of FacebookComponents of a Large Company Facebook

Campaign Investment

On-Going Blogging Campaign

• 12 Bloggers Time 1 hr/week, 52 weeks@ $25/hr = $15,600• Manager 1 hr/week, 52 weeks @$35/hr = $1,820• Blogger Planning 1hr/month@ $35/hr = $420

Total Campaign Investment > $17,840

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The ROI Of Facebook

On-Going Blogging Campaign

• 5 New Placements, Actual Profit $10,000/Placement = $50,000

• Total Campaign Return > $50,000

Components of a Large Company Facebook Campaign Returns

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The ROI Of FacebookComponents of a Large Company Facebook

Campaign Return On Investment

On-Going Blogging Campaign

Total Campaign Investment > $17,840Total Campaign Return > $ 50,000

For every dollar invested, $2.80 was returnedNet Return, $50,000 - $17,840 = $32,160

This campaign made the company $32,160

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Questions