The Measurement Standard: Blog Edition

And Today a Facebook Fan Is Worth $174.17

The latest entry in the epic What's A Facebook Fan Worth? discussion comes from Syncapse, pegging this mystic social media marketing number at $174.17. Download their report here.

Syncapse's chart at the left demonstrates that the $174.17 average varies so widely between brands as to make an average figure pretty much useless. As have been most efforts to nail down the elusive number.

The best discussion of this topic we've seen is by Olivier Blanchard, "The 5 basic rules of calculating fan/like/follower value." In which he goes over the reasons why an average is often just marketing snakeoil, but brand- and context-specific calculations can be very informative.

The hunt for the value of a Facebook fan is the modern day equivalent of the Alchemist's search for the Philosopher's Stone. It's more worthwhile for the research insights it yields than for locating the actual item itself.

What strikes me as really interesting about this Syncapse report is their comparison of fans vs. nonfans: "they tend to be brand users first, they spend more, engage more, advocate more, and are more loyal." See the chart below.

Some marketers may take this as proof of the value of investing in encouraging people to become fans. But what if fans are just different people from non-fans? What if some people just naturally want to be fans and behave like fans, yet other people, with different personalities, don't?

Maybe fan-based social media marketing works on some people (who are inclined by their nature to become fans), but just does not work on other people. -- Bill Paarlberg, editor

 

Read It Again: Olivier Blanchard On Facebook Fan Value

Olivier Blanchard's post on the cost and value of a Facebook fan ("The 5 basic rules of calculating the value of a Facebook ‘fan’") is, at almost two years old now, no spring chicken, social media-wise. But I promise that his insights will still juice up your next cocktail party, meeting with your agency, or interview with a prospective social media measurement hire.

His discussion of why the cost of reaching a potential customer is not equivalent to the value of that customer is brilliant. He develops an excellent framework in which to discuss cost vs. value of customers acquired for any medium.

I especially like his emphasis on the idea that these types of cost and value figures are averages across a wildly fluctuating population. A fan or customer's value is likely to be very flexible between individuals, over time, and between products. So to come up with some average and claim it's useful as the value of a fan is pointless:

...the notion that the “value” of a Facebook fan can be calculated absent the context of purchasing habits, brand affiliations, fluctuations in buying power, market forces and shifts in interests and even value perceptions is bunk.

-- WTP (thanks to KDPaine for the tip, and to Olivier Blanchard for the illustration)

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Facebook Reach Metrics Must Read

Wow. If you have anything to do with measuring the success of your Facebook page, or if you've ever wondered how many of your fans actually see your Facebook posts, then you have to look at Emeric Ernoult's post on the Convince and Convert blog. Although it's called "Busting Facebook’s Most Widespread Myth," it's really a primer on the complex world of Facebook reach metrics. Here's a sample:

 ...pages in the range of 100,000 fans have an average fan reach of 6.7%. However, the average of the worst 5% performing pages shows a reach of 0.6% of fans (oops!), while the top 5% performing pages reach an average of 20% of their fans with each post.

There's a whole lot more. Go read the post. --WTP (thanks to Entrepreneur for the image)

Dan Zarella Starts a Food Fight with "How to Calculate the Value of a Like"

Two days ago Dan Zarella authored a piece in the Harvard Business Review, "How to Calculate the Value of a Like," in which he presents a formula for calculating, yes, the monetary value of a Facebook like. The reaction has been fast and furious: read the comments on the article, and Olivier Blanchard's extensive response on his Brand Builder blog.

Paul Ceglia Loses Face, Booked On Fraud

Would-be Facebook owner Paul Ceglia has been indicted on charges that he faked a $25 billion contract with Mark Zuckerberg giving him a stake in the social media giant. See our previous coverage. Ceglia was arrested and charged last month with one count each of wire fraud and mail fraud. He apparently doctored a legitimate 2003 contract with Zuckerberg, in which the future CEO agreed to perform coding work for Ceglia’s website, into a phony contract “in which Zuckerberg agreed to provide Ceglia with at least a 50 percent interest in Facebook.” -- WTP

The More Facebook Fans You Have, The Fewer You Reach With A Post

Here's a chart from PageLever, by way of Mashable and Business Insider, that shows that the bigger your Facebook fan base, the smaller percentage of that base is reached by any individual post. You can see why rumors of a Facebook shakedown of big advertisers persist. Read the Mashable post to learn why George Takei said, "Is Facebook doing something to shrink my fan reach, at the same time it is telling me to pay to reach more of them?" -- WTP

Three Recent Studies Show Significant Fake Facebook Traffic

How much of social media icon Facebook's traffic is real, and how much is just spam or bots? Here are three studies that provide a quick guess: somewhere between 20 and 91 percent is real.

1. Facebook concedes that 8.7 percent of accounts may be not real people (spam, pets, or duplicates).
2. Limited Run cancelled their Facebook page recently, based partly on their own research which showed that 80% of the ad clicks they were paying Facebook for were coming from bots.
3. Here's an experiment by the BBC that found that nearly all the Likes for an imaginary product were suspect.

OK, these numbers are so rough that they mean very little -- except that a significant amount of Facebook traffic is not real people. Expect to see more data on this in the next future. And see this post by Russ Bradberry on the simplereach blog for an explanation of why there might not be as many bots as some claim. -- Bill Paarlberg, Editor

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(Thanks to http://declan.web44.net/images.html for the zombie robot image.)

Bill Paarlberg is editor of The Measurement Standard blog and newsletter, and of Katie Paine's book “Measure What Matters.” He is also editor of the book “Measuring the Networked Nonprofit,” by Beth Kanter and Katie Paine, which will be published this year by Wiley.
  Follow Bill Paarlberg on Twitter.

The Measurement Standard is a publication of KDPaine & Partners, a company that delivers custom research to measure brand image, public relationships, and engagement. Katie Paine, CEO of KDPaine & Partners, will be glad to talk with you about measurement for your organization.

 KDPaine & Partners' Facebook Page.

Can Facebook's Reputation Be Saved? Or: Mark Zuckerberg Should Have Taken My Advice When I Met With Him 5 Years Ago

by Katie Delahaye Paine

May 2012 AP-CNBC Poll

I RARELY WRITE ABOUT CLIENTS or former clients in this column, but this time I really couldn’t resist. I had the privilege of supplying Facebook with some of its first public relations metrics back in 2007 and 2008. As we were presenting results in Palo Alto one day, Mark Zuckerberg joined the meeting. I took the opportunity to ask him how he defined success for his PR team. He paused and then said: “People will trust us more.”

I’ve used this story frequently since then to illustrate the difference between how CEOs define PR success and how PR defines success. At the time, we were measuring the usual volume and tonality and correlating it to new Facebook signups. And, while that was a pretty good outcome measure in our books, it clearly did not reflect the definition of success that Mr. Zuckerberg had in mind.

His interest in trust prompted me to give him our paper on how to measure trust. I also gave him a copy of my book, opened to the How to Measure Trust chapter. (Click here now to buy Measure What Matters. Or click here to download just the chapter on measuring trust at no charge.) He could have -- and should have -- started right away to measure the trust that people had in Facebook. Might have saved some recent grief.

But I tend to doubt that Mr. Zuckerberg heeded my advice, since in the intervening years, Facebook has made little effort to bolster people's trust. Abrupt policy changes, unclear privacy rules, and an appearance of secrecy have resulted in a growing chorus of concern among journalists, legislators and customers. And, since one of the measures of trust is reduced legal fees, I can guess just by reading the papers that their trust index isn’t going up. (For more on Facebook's trust issues, see this article in The Atlantic, where the chart above appears.)

Now that the social networking giant has gone public it has a whole new audience with which it needs to build trust: the millions of individual and institutional investors that purchased its stock last week. And it doesn’t sound like they’re feeling it right now: http://money.cnn.com/2012/05/23/technology/facebook-lawsuit/

Many people liken trust and good public relationships to a rainy day bank account. You build up trust with your stakeholders over the years by being honest and reputable and forthright. Then when you screw up -- and we all do, sooner or later -- you've got enough trust in your account so that they will forgive you.

I find it supremely ironic (but not that surprising) that four or five years ago Mr. Zuckerberg had the insight and wisdom to identify a vital thing his company needed to do to succeed: build up its trust account. Yet since then he appears to have stopped paying attention to that trust account and has paid more attention to his bank account instead, confusing account growth with value growth.

The constant drain on Facebook's trust account coupled with the giant mess that was the IPO has left nothing for a rainy day. And we’re guessing there will be a lot of rainy days in the next few months.

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(Thanks for the May 2012 poll results image above to AP-CNBC.)

Katie Delahaye Paine is CEO of KDPaine & Partners, a company that delivers custom research to measure brand image, public relationships, and engagement. Katie Paine is a dynamic and experienced speaker on public relations and social media measurement. Click here for the schedule of Katie’s upcoming speaking engagements. Katie and Beth Kanter are authors of the book “Measuring the Networked Nonprofit,” to be published this year by Wiley.

The Measurement Standard is a publication of KDPaine & Partners, a company that delivers custom research to measure brand image, public relationships, and engagement. Katie Paine, CEO of KDPaine & Partners, will be glad to talk with you about measurement for your organization.

 KDPaine & Partners' Facebook Page.

Twitter Ads Earn 10x More Than Facebook Ads

This video from The Washingon Post presents the results of a new study that found that Twitter ads earn about $3.50 CPM, and Facebook ads earn about $.30 CPM. Says Simon Mansell, chief executive of TBG Digital, "I don't think Facebook needs to be worried, but it's a good sign for Twitter's ad business, if they can scale it."

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