As a premium or luxury marketer, you know you have to have a presence on Facebook.  How can you ignore a channel in which your market are spending so much of their time talking to their peer group?

However, it’s one thing having a brand page on Facebook, it’s entirely another to use it as an effective marketing tool. And marketers are coming under increasing pressure to demonstrate commercial return for their investment in time and money.

The problem is, marketing on social networks is a relatively new phenomenon – we tend to forget that brand pages were launched only a few years ago.

However, new insights are being unearthed all the time into Facebook fans and their behaviour in this channel. These insights are helping to give brands some insight into how Facebook fits into their overall marketing strategy.

We’d like to share some of these recent key insights with you, and our thoughts on how they inform communication strategies on Facebook:

1. Consumers are Warming to Liking

A recent study from eVOC in the US found that 59% of Facebook users have liked a brand/company page in the past 6 months.  Consumers seem to be increasingly open to interacting with brands on Facebook.

An earlier study by TNS found that consumers in the UK were amongst the most reticent to interact with brands on Facebook, but as trends have a habit of moving from one side of the Atlantic to the other, it’s likely that UK consumers are becoming increasingly comfortable with interacting with brands in this environment too.

We read much about how brands should be shifting their Facebook focus from recruitment to engagement. The fact that the ‘50% tipping point’ has only just been reached in the US, and may not yet have been reached in the UK, suggests that recruitment should remain a key plank of any brand’s social media strategy if it’s going to maximise its potential in this channel.

2. Your Fans are Likely to Be Your Customers

4 of the top 5 reasons for ‘liking’ a brand on Facebook, according to the CMO Council, are ‘to be eligible for exclusive offers’ (67%), ‘to interact with other customers and share experiences’ (60%), to ‘find service and support’ (50%) and to ’share ideas for new products and features’ (41%).  These are all motivations likely to be exhibited by existing customers.

Even more compelling evidence comes from a study by DDB Worldwide/Opinionway Research last year which that found that 84% of the fans of a typical brand page were already customers.

If the majority of your fans are customers, then it makes sense to focus your Facebook strategy on specific marketing objectives -  increasing purchase frequency, enhancing customer service, increasing customer insight and engendering positive word of mouth.

3. However, They Won’t Necessarily Buy More from You Because They’re a Fan

If most followers are existing customers then a logical marketing objective would be to try and increase purchase frequency.

The problem is, a separate study (and we need to caveat this with the information that this study only looked at a couple of brands in the confectionary and soft drinks sector) found that purchase frequency didn’t increase as a result of becoming a brand’s Facebook fan. The study found that Facebook fans skewed heavily towards existing heavy purchasers - perhaps the reason that purchase frequency didn’t necessarily increase. In fact, by offering discounts and offers to their fanbases, brands may be cannibalising full price sales amongst existing customers.

Perhaps the reason that heavy users form the bulk of Facebook followings may just be related to the ‘new-ness’ of brand/consumer interaction on Facebook? So, as consumers become more comfortable with liking brands on Facebook, so they will ‘like’ more brands and ‘heavy’ brand-using fans will become diluted by lighter brand users with more potential for incremental sales.

In the meantime, it may be worthwhile to focus on discounts that genuinely incentivise incremental purchase (buy one, get a discount on another), encourage ‘upgrade purchases’ or have a ’member-get-member’ element.

4. You Want Fans to Engage, but on the Whole, They Don’t

A study by Australian marketing thinktank the Ehrenberg-Bass Institute found that only 1.3% of brands’ fan bases were liking, posting, commenting and sharing content. If ‘new likers’ were stripped out of these interaction figures, the engagment rate for established brands was only 0.45%. Clearly, a like is no guarantee of engagement.

This is no real surprise – it’s no doubt a reflection of the early stages of brand/consumer engagement via social media.  In addition. those prepared to ‘create’ content rather than just consume it will always be in the minority.

However, these content creators have been proven to be influential in their peer groups by previous studies and the fact that they’re prepared to put the time and effort into creating content shows their advocacy for the brand. So this self-identifying segment would seem to be ideal to focus word of mouth advocacy efforts on.

In addition, if engagement levels are going to be low, it makes sense to focus on using it to fulfil specific business goals – like the recruitment of new customers from advocates peer groups or with specific product feedback in mind – rather than wasting time and effort creating engagement for engagement’s sake.

 

So in summary, our advice would be not to slacken off your Facebook recruitment efforts, remember your fans are likely to be your customers too, try to incentivise genuine increases in purchase frequency and engage with specific business goals in mind.  These insights should give focus to your Facebook marketing efforts and put you on course for genuinely understanding your brand’s potential on the number one social network.

By: Graham Painter

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