Facebook is gaining popularity as an advertising/marketing medium. Lots of businesses big and small are creating corporate fan pages and groups. I, of course, have a Facebook account for personal use but not one for my freelancing business. Why? Because, while Facebook is totally awesome it doesn't work for everyone. I'll be working on a short post called "You might not need Facebook if..." but right now we're talking about the infamous "Like " button.
For those of you who may not be familiar with the way this whole thing works, aside from personal pages, people can create group pages and fan pages. It used to be that if you wanted to join a fan page you would click the "Become a Fan" button. Not anymore. If you want to join a fan page, you now click the "Like" button. When you "like" a page, you are added to the column of other people who "like" this particular thing--similar to being a fan, but with one major difference. This little switch enables Facebook to offer targeted advertising to corporations because they keep meticulous notes on everything each Facebooker "likes." Facebook then packages all the people that "like" something as a potential sales pool, but how many people buy just because they "like" something?
There are lots of other blogs with lots of theories about how to calculate ROI on Facebook. I'll list some links at the end, but this article is about a misconception that I keep running into: Like=Increased Sales.
4 of my friends "like" Wal-Mart
Most people shop at Wal-Mart because of convenience, or the perceived value, so it was no surprise to me that 4 of my Facebook friends had joined the store's page. At my last count 1,173,430 "like" Wal-Mart.
We all know that more than a million people shop at Wal-Mart. I'm sure lots of them are not on Facebook for whatever reason but if Facebook has over 400 million active users shouldn't they have a share larger than .003? The explanation is simple, an Absence of Users--a company's popularity can never be fully represented by it's fan page. People may shop there but not join the page because of apathy, ignorance, or "whatever." I shop at Wal-Mart, there's one right up the street from my house, but am I on their fan page? Nope. Why? I'm one of the "whatever" people, I just didn't care.
I'm a Fan of World Market
I decided to "like" World Market because its a specialty store. They commonly post specials and sales as well as new products to their Facebook page. They aren't close to my house and I don't shop there unless I need something so their Facebook posts alert me to items/events I might not have otherwise known about. Do I always buy? No. But that's no different from the same risk you take with mailers and email newsletters--however, some people don't see it that way. False ROI--beware of micro marketers that give you a hard number for increase in sales based on your "likes." Without detailed tracking, you won't be able to tell the difference between fans that are making regular purchases not influenced by your Facebook effort and ones that truly represent an increase that couldn't have been possible without it.
Likers that Like to "Like"
Its hard to get a good estimate of actual "likes" because of something I call the Inflatable Pool--people will "like" something their friends "like" even if they have no real feeling about it one way or the other. These people inflate your fan lists making you think that you have more potential customers than you really do. They don't represent any sort of sale, let alone a sales increase. Keep in mind how easy it is to click "like." Its not the same as signing up for a membership or joining a loyalty club--there's paper work and occasionally a fee, so if they do it, they want it, and are interested enough in it to go the extra mile.
The bottom line? It's great if people "like" you but its important to know who your real customers are.
Additional Reading
