Rice University Professor, Alum Conduct Facebook Page Experiment

Posted on in Blog

Facebook Insights can tell marketers how many fans their Facebook business page has, how engaging their posts are, how many unique page views it has, and more. But Insights doesn’t tell you what’s happening between your Facebook presence and your customers offline.

Utpal Dholakia and Emily Durham wanted to explore this void to find out if businesses really influence consumers when they launch Facebook pages. Dholakia is an associate professor of management at Rice University’s Jones Graduate School of Business, and Durham is a Jones School alumna and founder of Restaurant Connections, a Houston‐based restaurant consultancy.

The duo decided to conduct a little experiment to see if one Houston-based company could influence its customers offline using Facebook. The company, Dessert Gallery, is a popular bakery and cafe chain.

The team surveyed Dessert Gallery’s 13,000+ mailing list customers, asking their opinions about the bakery and their shopping habits – nearly 700 responded. They then launched the bakery’s Facebook page and invited all mailing list customers to become fans. The chain then updated its page several times per week with contests, promotions, photos, etc.

After three months, the researchers resurveyed the mailing list customers – this time over 1,000 responded. Dholakia and Durham reported their research in Harvard Business Review. Here’s what they found:

> Dessert Galleries Facebook fans increased their store visits per month after becoming fans and generated more positive word of mouth than nonfans.

> Facebook fans went to Dessert Gallery 20% more often than nonfans and gave the store the highest share of their overall dining-out dollars.

> Facebook fans were the most likely to recommend Dessert Gallery to friends and had the highest average Net Promoter Score* — 75, compared with 53 for Facebook users who were not fans and 66 for customers not on Facebook.

> Dessert Gallery Facebook fans also reported significantly greater emotional attachment to the chain — 3.4 on a four-point scale, compared with 3.0 for other customers.

> And lastly, Facebook fans were the most likely to say they chose Dessert Gallery over other establishments whenever possible.

Dholakia and Durham noted that the “results suggest intriguing possible correlations rather than definitive causalities.”

Dholakia stated in a Rice University press release that “we must be cautious in interpreting the study’s results. The fact that only about 5 percent of the firm’s 13,000 customers became Facebook fans within three months indicates that Facebook fan pages may work best as niche marketing programs targeted to customers who regularly use Facebook. Social-media marketing must be employed judiciously with other types of marketing programs.”

Interestingly, Dholakia and Durham’s Harvard Business Review article states that only  2.1% of the customers on Dessert Gallery’s mailing list became fans within three months. I’m unclear as to why there is a discrepancy.

Either way, there is a strong correlation between Facebook business page fans and their loyalty to the business. It seems clear that businesses need a Facebook presence to develop deeper bonds with their clientele, which company websites can certainly lack.

Has your business seen this type of response after launching your Facebook page?

* “The Net Promoter Score, or NPS®, is a straightforward metric that holds companies and employees accountable for how they treat customers,” according to NetPromoter.com.

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