One of the surest ways to gain more profit in any advertising campaign is to have a better understanding of your potential customers. Identify their needs, their buying patterns, and what tickles them. The same principles are valid for social media marketing. Brands make huge marketing campaigns on social media and also acquire huge fan base on their fanpages through efficient Social Media Marketing. But how these fans affect the actual sales and profits of a brand needs to be properly analyzed.
Digital consulting firm Syncapse and research company Hotspex have come up with an empirical formula that puts an average value of $136.38 on the Facebook fans of the site’s 20 biggest corporate brands. That is the amount that is expected from a potential fan out of his brand loyalty.
The study found that people spent significantly more on products they were fans of, compared with consumers who were not fans. In the case of many of Facebook’s most popular food and beverage marketers, fan spending was more than double that of non-fans. The pattern of increased fan spending held across all of the top 20 brands on Facebook, with differences ranging from 51% for Oreo fans to 168% for fans of Nokia.
Other studies have shown social followers are more likely to buy a brand’s products, but have focused on whether such consumers are brand-loyal rather than how much they actually spend. Social media management company virtue also attempted to put a dollar figure on Facebook followings. That study examined impressions in the Facebook newsfeed and their earned-media value to arrive at a figure of $3.60.
Thus fans definitely help increase the sales and profits in concrete numbers and now research has made it possible to calculate the exact worth added to the brand by its fans. This is an extremely good sign for all brands and will help them properly utilize social media.
