Value of a Facebook fan is now actually $10
For those keeping track at home, the value of a Facebook fan can vary wildly— depending on who you’re asking. It has been put as high as $136 a head, to $3.60 (as I blogged last year) or well according to some it is zilch.
I like Jim Edwards from Business Insider’s take on it. He said calculating the ‘value’ of a Facebook fan to an advertiser has become the social media equivalent of asking “how many angels can dance on the head of a pin?”
The latest estimate at the intrinsic and often mysterious value of a fan is about $10, according to social media agency SocialCode.
That means that Starbucks’ 26 million fans are worth a whopping $260 million dollars.
The study, which encompassed 50 brands and 5m Facebook ads, (using some fancy maths) found that the difference in the cost per acquisition between a non-fan and a fan, in terms of certain actions like installing an app, generating content or purchasing, was $9.56.
Source: SocialCode
And that’s that? Well, not exactly.
The study may actually raise more questions than it answers, such as: Do consumers become fans of brands, then begin to purchase more because of the brand engagement? Or are fans because they’re already loyal customers? Is there any point in calculating the value of a fan? What do you think?
One thing that strikes me is that the fans of some brands have to be worth more than others because of how they engage with them or because the fans of one brand are more active.
All Comments
Any how many of those fans are actually ‘active’ ? Valuation of a fan must be looked at in two ways:
1/ how much value can i put on my fan base, so that i can sell to commercial partners
2/ how much value can i attribute to my fan-base from a crm / consumer dialogue perspective
I only mark fan when I am already a customer. I never become a fan of something I wont use. Now that being said I did do that a long time ago with a few things but not for a few years now.
I’d agree with Daniel’s points (not only due to our common name…). When looking at commercial activity (in the form of advertorialised posts) across our FB pages, I’ve looked to value fans based on the estimated cost to reach the equivalent volume of Unique Users via display media on our sites. Depending upon the site this gives $0.05-$0.10 per fan per post.
[...] The Value of a Facebook Fan is Now Actually $10. [...]
[...] Nonetheless, there is a taste in the market for bold, simplified figures. In April, social marketing software provider Vitrue crunched some numbers and provocatively concluded that a million-strong Facebook fanbase translates into at least $3.6m in equivalent media over a year, based on impressions generated in the site’s news feed. Later in November the value of a Facebook fan was put at $10. [...]