The Corporate Battle of the Facebook Likes

One of the best things about my job is that I get to meet executives from many different companies, both big and small.  I was having a discussion the other day with a digital marketing executive from a seriously huge brand (can’t politely name it) and he told me this story, which he said was OK to share with you …

His company, a famous consumer products company, became obsessed with assuring that their brands had more Facebook “Likes” than equivalent competitor products.  It actually became a marketing strategic goal and part of the annual performance objectives for brand managers.

The brand equity is roughly equivalent to something like “Mr. Clean” — successful, well-known, historic, but not exactly the center of daily conversation. A household given.

The company has two success metrics for this social media initiative:  1) Did the brand have more Likes than the leading competitor and 2) What was the “cost per Like?”  So internally, brand managers competed fiercely to have the lowest “Like acquisition cost.”

At first, I was amazed that a major brand would have such a seemingly strange view of marketing success but these are smart people so I gave them the benefit of the doubt and tried to figure out what the possible benefits of this approach might be. Here’s what I dreamed up:

  • Perhaps they have research that shows there is important value in the appearance — “the social proof” — of having lots of Facebook Likes versus competitors.
  • Maybe they are planning to create exceptional content that will reward those people who like the brand and turn them into fans. I don’t think this is the case, but it could be possible.
  • Some studies have come out equating Facebook fans with a dollar value. I am skeptical about these generalizations but maybe they have some new market insight about this potential.
  • By creating this internal competition, perhaps they are exploring best practices to garner fans.
  • Maybe with this experiment, they are figuring out the most cost-effective way to link paid advertising and interaction on Facebook

On the surface, this battle of Facebook Likes seems arbitrary, but what do you think?  What is the possible value?  Are people getting caught up in this at your company?  Are you linking “Likes” to brand loyalty or sales?

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  • I have two comments:

    Since you can’t as a brand engage with all the commenters and likers this is not social media but really push advertising. The biggest brands with millions of Fans get if they are lucky….1,000-3,000 comments on a post. If you have 5million fans it is a very very small % engaging with you. And you can not respond to even hundreds of comments personally. BUT this is a great free focus group for listening and feedback. I think better than most brands think.

    But then lets take the value. This is real life from my favorite brand the only one I engage with via social almost daily and I have courted as a consulting client even doing some pro bono work last winter which I got paid for…Chobani Yogurt…I got a case of yogurt (12 cups) #disclosure but they are not a client.

    Last winter they has 3,000 twitter followers and 10,000 facebook Fans. They had a serious Blogger presence and a fanatical fan following. In April they took the crown as Number 1 yogurt in the US. At that time they had 6,000 Twitter followers and 20,000 Facebook fans. Hmm…Social wasn’t the driver what was? Product and price point. They had come down in price from $1.79 a cup to between $1 and $1.29 and they have the tastiest best quality ingredients yogurt in my opinion. As I always say Product and Price trump everything!

    A month ago they jumped from 60,000 to over 200,000 fans. So I contacted my friend there and asked her was this organic? No they spent big $$ on Facebook Ads and off Facebook promotions to attract fans. With no plausible explanation. My response? You had a yogurt shortage that money could of gone to the plant expansion, worker bonuses, or even TV ads. I felt it was a waste. They already are Number 1!

    And seriously anyone who thinks Facebook will still be dominant in even 3 years is rolling the dice. What happens when it becomes Myspace (it will) all that work to get Fans……

    But an LA small business client told me she felt when people come to your page if they don’t see a high number of Fans they wonder what is wrong with the brand.

  • I’m betting your customer hasn’t really thought about what
    they are going to do with those fans. I think this is just part of the
    continuing misappropriation of social media energy. Marketers perceived the
    Facebook page as a way to get access to customers similarly to having an email
    list. However, the benefit is far less than that of an email list. Further, as
    Jeff Bullas notes on his blog, fans aren’t actually that likely to see your
    posts and neither are their friends. I just don’t think marketers have quite
    caught up with the fact that Facebook fans aren’t all that valuable (by and large)
    and that they don’t have the level of access they thought to those people.

    I do understand, though, that at least matching the
    competition could be important to saving face. It would be embarrassing to have
    significantly less fans than your competitors.

    It’s crazy to see a “fans-race” like this taking
    place. I think it won’t last. I think marketers will figure out the failure of
    Like, soon. I personally believe we’re at the beginning of a shift away from
    Like and building fan bases on Facebook at all costs, and on to a more
    sophisticated approach where businesses look at how to create compelling
    interactive environments on their websites and on Facebook–ones that are
    largely self-sustaining. Facebook’s social actions really can pave the way for
    that.

  • You are certainly always good for driving discussions my friend!  I’m not sure I agree with everything you say.  Price and product are not the only ways to move the needle. Look at Amazon.  You could go to your local bookstore and get a book the same day, at a lower price, and probably have a nice cup of coffee while you do it.  And yet Amazon is killing the bookstore competition.  There are many ways to compete, including marketing.

  • Instinctively I agree with you.  But social media is not exactly new any more and these are smart people. That’s why I think (hope) there is something else going on! 

    Superb commentary Neicole. Thanks!

  • I had a similar discussion with another executive of a large public company last week. The thing that amazed me was how misaligned he was on actual actionable metrics. This didn’t mean he wasn’t serious about staying current with their online presence, it just meant that the metrics that he was able to communicate to his stakeholders just didn’t make sense from a corporate social strategy point of view. 

    He needed to show in one sentence that he was making progress and he needed to show it to people who call their (grand)children to ask about this latest thing called Facebook. So from a corporate political perspective I get your executive’s thinking. 

    That doesn’t mean it make sense nor does it mean that he’s clueless, he might even be extremely smart by targeting metrics that are easy to grow and fast to communicate. The downside comes when actual monetary ROI will be measured. 
    It’s like the “we’ve got to have a website” rush about a decade ago. The executives that come out shining (and the consultants with them) are those that can balance the internal political/PR with actually growing a valuable social property.  

  • stefankrafft

    Hi Mark, 

    Thanks for a, as usual, good post. This is for sure an interesting discussion and I would like to hear what reasons he gave you for having this measurement. I guess that will be your next post on this topic. 

    My reflection on the topic is that it´s all about knowing what to measure and why. I am sure about that there is a lot of companies that has not set what to follow up and how to do it. Sometimes the problem is that the measurement they have done in the history doesn´t fit in any longer and therefore there must be new metrics to show up so you don´t risk the factor of not being able to set your ROI for all of your activities. So, what do I think, I think it´s better to measure something like likes rather then not doing it at all or spend mounts looking for the perfect setting of “processes” to be able to start to track how your performance is doing online. 

    And as you said, this is smart guys and a long the way they will, hopefully, do a lot of good stuff on the social web that will take them to the next step. So what I am saying is – do it and if it seems powerful you prove it is! 

  • I don’t see the benefit in generating thousands of Facebook fans, especially since they rarely turn into dollars. In this case, from what I gathered, this appears to be their primary objective in social. If this is the case, than there is some heavily wasted resources and talent that can be much better spent elsewhere. If this is part of a much larger campaign, than I see the benefit, because you certainly want to have all your bases covered. Facebook should never be your main focus.

    One of the few advantages Facebook can provide is brand recognition and authority, but with the company you described, they don’t need either.

    Even smart people make poor decisions sometimes.

  • It’s understandable to have “social proof.”
    It is also valid that in order to grow a business, you need to grow the following. However, the concept of having more Likes than the competition seems shallow. Frankly, it sounds like more of a goal to massage the ego, than a sustainable (and profitable) social media goal such as offering an outlet for customer service and increasing brand loyalty.

  • I’d rather have half the likes but twice the engagement.  Anyone can purchase likes/fans/followers and the casual consumer might assume “social proof.”

  • I sure understand that Dennis and see it myself. I guess what surprises me is that it is still going on so rampantly.  I thought the Gold Rush mentality would be subsiding by now. Thanks for the great comment!

  • This is a superb point Stefan. I do think there is confusion about measurement in the new media.  To answer you question, my friend really did not have an answer as to why this was happening. He was at the receiving end of it and was turning to me out of frustration. That is when I tried to help him think it it through … which usually turns into a blog post!  Thanks so much for commenting!

  • I do suspect the social proof has something to do with it. For people who are immersed in the brands every day, this is probably a big deal and it may be valid. Social proof does matter!  Thanks for commenting today, Rachel!

  • This is a short but powerful point Arthur. I’m also somewhat skeptical about the whole engagement thing. I think for many brands this is an unrealistic concept (as Howie points out below).  What if millions of people do want to engage? Then what?  I spoke to the digital director of a large gloabl brand who has a team of 25 people tweeting full time. Some of these folks are beginning to have their own fans. People come on and chat with them about their relationships. I wonder … is this selling product? And I now the purists will cringe when I ask that product, but you know what … at some time you DO have to sell product! : )  Thanks for the thought-provoking comment!

  • Well, we’ll probably never know. Maybe I’ll get an update from my friend!  Thanks for caring enough to comment Samantha!

  • This kind of competition fits in the category of what I call the “I vote for ALFALFA!!” contest. It is easily manipulated and therefore somewhat meaningless.

    But if I was working at your friend’s company, and it was all about having a lot of “likes”, you better believe I’d be creative about getting them. Watch the very short clip from a 1936 episode of “The Lil’ Rascals” and you’ll see what I mean.


    Maybe the modern day lesson learned here is: No matter how many likes you have, it’s better to have real friends. 

  • I agree Mark. I wish to include as part of ‘product’ service etc. Amazon’s site and ease of ordering is part of what they sell. Same with Zappo’s.

    And Marketing is a critical part of the equation. If no one knows about your product or business you will get no sales.

  • Where do you get this stuff?  I love the Lil Rascals. This clip is the first American Idol competition! : ) 

  • I heard an interesting comment (on NPR, I believe) regarding the efficacy – or frequent lack of efficacy – of Facebook branding efforts.  The upshot of the commentary was based on two points.

    1. Facebook’s popularity is bedrocked in the entertaining waste of its user’s time (think Farmville)
    2. If your company can’t think of a valid way to waste the time of your fans through some genuinely entertaining fashion that actually has to do with your brand, you’re wasting your money – because that’s the only reason people come to Facebook.  To be entertained while wasting time.

    I believe it’s generally a useful and necessary thing for a successful or up-and-coming brand to have a Facebook business page, but I think it’s truly difficult to find the ROI to justify an extravagant Fb branding campaign.

    Mark, I agree that we should assume that a savvy and successful business like the one you’re talking about would have some other less-obvious goals in mind.  But your post reminds me of the dot com boom days when Internet start-ups competed to have the craziest, most-extravagant in-office benefits for employees – presumably to attract the best employees to improve performance.  But it was much more about bragging rights than it was about the bottom line.  In the end, it bit companies in the ass, and there was a pullback to reasonable, more traditional plans.  I would expect that we’ll be seeing a pullback from this type of social media branding frenzy, too.

  • I see a lot of misguided thoughts in these comments. You guys are employees of marketing firms correct? The value of Facebook fans is there, but it is a small value on a number of different levels that adds up to something equitable or even surpassing other forms of advertising. 

    I often find that marketing employees that have had poor performance in their Facebook dept. downplay the importance of Facebook likes, but all the data points to Facebook as a viable medium for connecting to potential customers. On my best accounts I get a 75% impression rate for each update, so the real goal is to generate an update that is interesting enough to trigger action. It’s repeatable as well, I don’t have to buy more ad space to send out another tomorrow. 

    As for conversions, different markets will have different conversion rates with Facebook pages. The one thing great about using Facebook ads to advertise your page is that they divide the users into extremely specific demographics for you. The bad part is that they need you to buy those ads so they nerf the value of the pages. It is possible to garner likes through Facebook at rates as low as 1 cent per like. Think of a page like Lady Gaga that was already liked millions of times before Facebook even introduced pages. If you say that every like is worth 10 cents (which they are worth more because like i said, they are basically a repeatable online advertisement, that is better yet disguised as individual engagement) then Lady Gaga’s million likes were worth 100,000$ and Facebook handed that to her when she verified her page. 

    The real value comes not from conversion but in keeping the impression. Fans will find it hard to forget about you if you produce good updates. Getting the likes is half the battle, the way you use the ad spot is what really counts. And like was mentioned previously, there is always that social proof. I have done case studies where it shows a male with an Avatar wearing a suit will enjoy more engagement across several social networks than a male model. Those likes do act as a social proof to potential customers, but that would be a complex equation. If 50 cent had only 5 Facebook fans, those 5 fans would engage at a much higher rate because they aren’t competing with others. After you get to a saturation point, it turns into the more the better, and since there is little value in keeping a huge brand at under 2000 likes, it is clear to me that more likes is better. 

    All things being equal, engagement is just another form of social proof. How many people in these comments clicked an ad or bought your book? Engagement= conversion about as much as likes= conversion.

  • Caroline Cayce

    I get asked this question a lot. As someone involved in new business development in a very skeptical industry, I hear… “I’ve got fans and follows – now, what are they worth?”

    I agree with Stefan. “My reflection on the topic is that it´s all about knowing what to measure and why.”

    Because each brand has unique needs, it’s absolutely imperative to determine what success looks like for the brand prior to its social outreach or targeted campaigns. Our clients have products that have longer product life cycles…so isn’t it worth it to be in constant contact with their audience in between purchases to secure brand loyalty? Shouldn’t that have an influence on the buying process?

    We urge our clients to look at their business opportunities and overall goals to determine how much it’s worth to be in constant contact with their audiences.

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  • There are 2 thoughts I have about “likes.”

    First, it’s super easy to get your friends who have no intention of buying from you to “like” your page.

    Second, most people seldom see your page updates, and if you are spamming them with sales messaging, even if you are a really well-known brand, they’re going to see even less of your updates. 

    If a person updates Facebook but no one is listening, are they really updating Facebook?

    The likes that I look for on a page are likes on posts, not necessarily likes of the page. Likes on the updates, and comments, show that people are keeping in touch with your content. That still may not translate to sales, but they are paying attention and, well, they are liking what you’re saying. That’s a pretty good foundation anyway, right?

    Competing for likes just seems daft though. Look for engagement.

  • Hey Mark, I have the same ‘wonderings’ as you. Recently I have the opportunity to speak to some huge MNCs and they too have the same thoughts on Facebook likes. It would seem that this is a standard marketing practice calculated by their PR / media agencies. 
    What amazes me even more is that when they’re asked what would they do with their X amount of likes, they cannot provide a proper answer. It is just to out-like their competitors and to keep them as trophies (or in their words, it’s a measure of success in the social marketing campaigns).

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  • I agree. I recently wrote a post about the business case for Facebook is “come waste time with me!”  I also think there will be some rationality creeping in soon. That’s why this surprised me so much!  Thanks for sharing your wisdom today! 

  • I appreciate the thoughtful comment and generally agree with you, but I think you’re somewhat mixing apples and oranges.  First, this post had nothing to do with Facebook ads. I regard that as an entirely different strategy — an entirely different channel — than the organic activity of Facebook Likes.

    Impressions is a very tricky business on Facebook. As you correctly state, it depends on content. This company had no content strategy, which was part of the point. When you say “all the data” points to Facebook as a viable means of connecting with customers, I’d like to see that. In fact, outside of the elite brands who already have built-in fans, I think most companies are not doing this well at all. I’d love to see that data.

    Impressions depend on activity and where most companies fall flat is that their activity never makes the timeline — even if they have been liked. If you can really engage and get customers to love what you do to EARN those impressions, I agree with you, but that is a very difficult task.

  • I agree with you but the challenge is earning that right to have the engagement.  I probably have “liked” a dozen brands. How many are showing up in my timeline?  One — BMW — because they have crazy good content.  Marketing on Facebook is difficult!  I’m glad you’re having success! 

  • Nothing to add to perfection : )  Thanks Margie! 

  • They may be right.  I do believe that there is some value in social proof.  And likes are relatively easy to get and a handy measure to show a client.  So I see the expediency, but am still unconvinced about the effectiveness.  A like is fleeting.  Thanks Jan! 

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  • Given the frequency with which I “like”, get bored with the endless brand messages in my stream and then “unlike” without ever buying anything I will always go back to basics:

    does it make a profit now?

    if not, when is the break even point?

    If there’s no answer to either it is time to go have a sit down and a rethink.

  • Pjtoday

    One of our clients went from 34,000 facebook fans to over 95,000 fans over night. They were giving away free product to the first 100,000 people who liked them. And now, 24 hours later, they are at over 129,300. The volume of this reminds me of direct mail response. Two percent response rate to direct mail is considered good.  I have to think that a two percent response rate to facebook liking is better than direct mail because companies don’t spend money on postage. There seems to be less risk. I don’t have stats on the ROI yet. But I’d love to hear more about success in turning likes into dollars. It’s fascinating to me. 

    I do think certain consumer brands are better candidates for success on facebook than B2B brands.  

  • Andre Niemeyer

    Let’s dream up! I vote “social proof,” as to what is going on in the CEO’s mind. Also, he might be looking for some impressionable (though somewhat vacuous) metrics to convey to the board and shareholders.

    But I’ll take it a step further and challenge some of my fellow marketers, most of whom I believe are truly committed to generating quality content to their audiences. And this might get more to the point of what the CEO had in mind, along the lines of social proof.

    Some new study by Nielsen and McKinzie, as reported by Mike Stelzner, states that about 60-70% of US consumers use social media to assess a company’s brand and product offerings. These are not sophisticated marketers, with a keen eye on engagement and its various metrics. They are retailers, with their ultra busy lives, evaluating which product to put in stores; real consumers looking for that last final touch point to decide what to buy; and on it goes. People who have neither the savvy nor the time to see what we (as trained marketers and analysts) can see. “Facebook Likes are good enough to me,” many of them say. And as such, “social proof” (even if gimmicky) assists conversions.

    That’s what I dream up is in the CEO’s mind: “social proof” (note the scare quotes) can assist conversions, even if incapable of originating one single sale.

    To that I say: let’s build real social proof, create real fans and advocates and not only assist but help originate sales thru quality content, engagement, and value to our audiences. Aim higher and fly closer to the sun, to quote Seth Godin.

    Source:
    – SME: http://www.socialmediaexaminer.com/7-social-media-trends-for-consumers-new-research/
    – Nielsen: http://blog.nielsen.com/nielsenwire/social/2012/

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