Are Facebook Fans Really Worthless to Digital Pharma?
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- August 20th, 2010
That’s what Augie Ray, Forrester Research’s expert on social media marketing, suggested in his eponymous blog: that the value of a Facebook fan to a Brand is zero. While Ray acknowledges that he hears value estimates from reputable vendors ranging from $136.38 to $3.60 (Syncapse Media and AdWeek respectively) he advises us to start at $0.00. Why? Is this merely to provoke us or is he on to something?
Check Your Assumptions At The Door
It’s the underlying assumptions used in the ROI calculations that are at fault says Forrester’s Ray. For example:
- The methodologies used by those calculating ROI are based upon generalized audience assumptions but every brand is unique and thus so is its audience. If you’re marketing a branded, ethical product for the treatment of a chronic condition, how do you compare yourself to Starbucks 10 million fans?
- If you agree that you are different than Starbucks and Lady Gaga, would you agree that not all fans are equal? Some are more vocal, posting often, while others are more quiet and lurk. How are the “Motrin Moms” accounted for in your ROI calculations?
- Lastly, where do your fans come from? Did you incentivize them with a coupon? Or are they true fans in the “groupie” sense of the word? The way fans are acquired impacts value and needs to be accounted for in your calculations.
It’s What A Fan Does That Counts
Ray likens this to an email subscriber in your database that is never used. Dormant in the database that email address is worth zero. Likewise with your Facebook fans until you do something with them. For example, you could:
- Convert them from unbranded to branded messaging
- Funnel them towards your existing offline and online conversion channels: couponing, email newsletters and other web properties you manage.
- Mitigate risk. This is the greatest potential value of a Facebook fan according to Forrester’s Augie Ray. (And he’s got this own forthcoming ROI report to prove it).
How To Value a Pharma Facebook Fan: Quick Back Of The Envelope Method
The rate of change for social media properties is fast, furious and out of control (see a map comparing the 3 year differences). While I do like fast, it’s the furious and out of control part that is troublesome. What’s a digital pharma marketer to do?
- Consider Facebook as just another means of lead generation. You already know how much it costs to acquire leads from your other sources, can you use this same equation to roughly estimate the acquisition cost of a Facebook Fan? Agency Costs + Your Time?
- Compare to other systems already in place. For example, “sign up for a month’s free trial” of Rx via your online couponing system. What does each sign up cost you? What’s the bump in sales from a customer who redeems a coupon? What’s the ROI of a Facebook Fan who converts to a coupon? (It’s simplistic but that’s why it’s called “back of the envelope” method)
- Take a monthly look at your web analytics executive summary report. Yes you have people who do that for you, you just want a decent “gut check.”
- And finally, don’t be afraid to say “the emperor has no clothes” if that really is the case for your situation. You know your brand, your corporate culture, and your customer best. Hype sells services. Fundamentals sell products.