Home Data-Driven Thinking I Like You, But Not In That Way

I Like You, But Not In That Way


marc-grabowski-better“Data Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Marc Grabowski, Chief Operating Officer of Nanigans.

A parade of limousines filled with elaborately dressed high-schoolers is a sure sign that prom season has arrived. The season evokes memories of confusion and awkwardness. Whether it happened to you or one of your friends, there’s no doubt you are familiar with at least one prom crash-and-burn in which someone asked that special someone else to prom, only to elicit the dreaded response “I like you…but not in that way.”

You (or your friend) misinterpreted signals and bet everything on bad data. Worse yet, you (or your friend) lost precious time courting the wrong person while alternative dance cards filled up quickly.

This is the same fate that digital advertisers face every day.

Social Media Is High School Revisited (Digitally)

For years, you were able to repress your prom memories by burying them deep in your mind – that is, until you decided to become a digital marketer and apply your skills to Facebook. Now you must interpret the value of a Like to understand if it truly indicates what you ultimately covet – a strong, lifelong customer.

Those of us who spend time at the intersection of social media and direct marketing frequently debate the value of a Like. To this end, numerous studies have been compiled on the subject, one of which went deeper into methodology than usual.

Last month, Syncapse released a study titled simply Value of a Facebook Fan. This study arrived at the conclusion that the average Facebook fan was worth $174.17 (an increase of 28% since 2010, when Syncapse completed a similar study). The value of a fan ranged from $70.16 (for Coca-Cola) to $1,613.11 (for BMW), with tremendous variation in-between.

The study found that the range of a fan’s value for the brand depends on a number of variables, including product pricing and the number of fans the brand has amassed.

Unfortunately, though, studies like these tend to raise more questions than answers.


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A Public Display Of Affection

Digital marketers – and brand marketers in particular – have focused on acquiring fans since the onset of Facebook marketing. Fans opt in to receive communication from your brand in the same way they do with email marketing. This digital flirting comes with an expectation that your brand will provide value in that communication.

Developing a fan base and cultivating relationships with those fans can yield great results in some cases. Much like the adage says, not all customers are created equally. You must look at segments of individuals to assess their true value to your business.

An example from the Syncapse report illustrates this concept: 89% of Levi’s fans are likely to purchase a product from the brand, whereas only 70% of nonfans are likely to purchase. This data point suggests that fans may be more likely to purchase from a related brand than nonfans.

Once you assess your fans’ value, it’s time to figure out if there’s correlation – or even causation – between your fans and your buyers. In other words, are fans more likely to spend on your brand, or are those who spend on your brand more likely to become fans?

Aspirational Fans

Core to the Facebook experience is sharing interests with friends. When you Like a brand’s Page, this story is published on your Timeline and publicized to your friends, family and colleagues. While this move signals a display of interest, it does not always mean that you buy the brand’s products. Luxury brand pages are a great example of this; many people who Like Gucci or Rolex may not have means to buy the brand’s products.

If a brand like that expects its fans to become its future buyers and, therefore, focuses marketing efforts on those fans, it may be spending a disproportionate amount on unlikely buyers.

This is not unlike investing time on that high school sweetheart who ends up liking you only as a friend.

Great Expectations And The Costs Of Maintaining Fans

Strong social strategies are focused, not only on acquiring customers via social channels but also on providing value through these channels. Before launching a fan-acquisition campaign, outline the cadence of communication you will have with your fans and the reasons they were initially attracted to your brand page. They may be looking for:

  • Coupons or discounts
  • Exclusive product information
  • The handling of product grievances via this social channel

If you don’t live up to their expectations, how will scorned fans exact revenge? According to the Syncapse study, two-thirds of fans are likely to share a bad experience with others – and fans are 21% more likely to share a bad experience than non-fans.

CMOs should ask themselves: How much will my fan engagement strategy cost in terms of content creation? And what is the negative impact if I mismanage a relationship? Will this damage a single relationship or will it hurt my overall reputation and make me undesirable to all?

All Fans Are Not Created Equal

Based on their purchase behavior observed over time, each customer represents varying value to your brand. Fans vary in value as well. It’s imperative to think about the elements that define great customers and apply this to your fan base.

If your core buyers are women aged 35-54 with a household income of more than $200,000, target your fan acquisition campaigns to people within this bracket, as fans from different target audiences will – by definition – represent less long-term value.

The same Likes from different people can lead to very different outcomes.

Correlating Likes To Buys

This raises the core questions of this discussion: What behaviors are most evident in a loyal customer? Which elements in the customers’ DNA truly matter when choosing whom to court from browsers to buyers? Where should you focus your dollars to drive the best customer base?  Likely you will find that a Facebook Like is part of that equation but must be measured against all other qualification criteria to understand the value for your particular brand.

Thankfully, for high schoolers everywhere, the complexities around digital direct response are far more complicated than interpreting social signals in the formative years. My one wish is that DSPs had been conceived decades ago with a slightly different application – securing a prom date.

Follow Marc Grabowski (@MarcTGrabowski) and AdExchanger (@adexchanger) on Twitter.


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