Oneupweb : What’s a Facebook “Like” Really Worth?
Why should I bother increasing Facebook “Likes”? How do I know if it’s worth it? I’m asked these questions frequently when discussing Social Media Marketing strategies with clients. It stands to reason if many Facebook users are Liking your brand, they’re more engaged and making more purchases. The more Likes the better. But getting concrete numbers to back this up is elusive.
Well, I have an hypothesis that may crack the code. ChannelAdvisor’s Facebook Commerce Index tracks “Likes” on brands. For the month of July it reported that Wal-Mart holds the #4 position on the total Likes list. Victoria’s Secret, Adidas Originals and Victoria’s Secret Pink brands rank higher. But for my analysis, Wal-Mart is a better choice due to direct revenue reporting every quarter.
I’m wondering if there is a correlation between Like increases and reported revenue numbers. For example: Wal-Mart’s Likes in July rose 13% from June. Did revenue in July also rise 13% compared to June? With Likes increasing so dramatically, will next quarters revenue numbers be an upside surprise? Approaching the question of Like valuation in this way could be very enlightening.
Sure, there are a few hurdles on the road to this attribution Nirvana. First being Cause and Effect assumptions. Did sales increase because someone Liked Wal-Mart and then purchased? Or did they purchase first and then click Like? Does the timing really matter in this case? The purchase and Like are tied together.
Other considerations: Do Likes matter only for WalMart.com or do they impact store location sales? Is there a lag between the purchase and the Like? If I Like the brand today, will I wait until pay day or a gift giving occasion to buy? Liking implies an endorsement. If you’re endorsing a retailer, you’re predisposed to purchasing.
How about the argument that only existing customers Like a brand? OK—so what? If existing customers are engaging with your brand in this manner they are ramping up their loyalty and intent to purchase. That’s always a positive.
Here’s where I ask for your ideas on enhancing this analysis. Am I all wet for proposing the linkage between Likes and reported quarterly revenue? What have I missed in developing this hypothesis? More research is certainly warranted, but one thing is certain—a Like demonstrates an increase in share of mind for marketers—that’s half the battle in the marketing arena.